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An open letter to the PM and ministers on ECRL

MP SPEAKS | The cancellation of the East Coast Rail Link (ECRL) project and the bickering between two cabinet ministers over the issue have become the talk of the town. I foresee this issue to be a hot topic in the cabinet meeting this Wednesday.

Whether the cancellation of ECRL was discussed in the previous cabinet meetings or not, I earnestly hope the cabinet can explore the effects of axing this project. 

Take a moment to consider factors such as the friendship between the people of both countries, jobs and economy, diplomatic ties and the reputation of Malaysia.

On the bilateral relations between Malaysia and China, I can safely say that putting a stop to the ECRL project will harm the diplomatic ties between Malaysia and China. If we put ourselves in China’s shoes, we will surely respond negatively if our overseas investment is treated as such.

Let’s not forget that the price of commodities in our country has been on the decline. A nightmare looms should China take any retaliatory action, such as reduce or even halt the import of commodities – palm oil in particular – from us.

If that happens, Felda, Sime Darby and other big corporations will be the first to feel the heat. The livelihood of some 650,000 smallholders and their families will be directly affected.

From an economic perspective, the ECRL project is likely to boost the GDP growth of the three east coast states by 1.5 percent. It will also spur the development of the east coast, enhance connectivity between the east and west coasts, and close the economic divide between the two. 

Through bridging the rural-urban divide, the overall development of Malaysia will be more balanced and comprehensive.

The rail link is 20 percent completed, with several tens of billions paid to the contractor. On top of that, Malaysia will be penalised for cancelling the RM30bil loan from China's Exim Bank. We will have to repay the loan and compensation within a short period of time.

High price to pay

From my experience in administering engineering projects, any breach of contract will result in a hefty penalty. The compensation for cancelling ECRL could reach RM20 billion. 

Financial losses aside, scrapping the ECRL will also have a negative impact on Malaysia’s reputation in the international arena and erode its trustworthiness.

Judging from my past experience dealing with China and its officials, as well as the friendly gestures displayed so far, I can conclude that Beijing is willing to achieve a win-win solution instead of a situation where both sides lose out. 

The government can consider restructuring the project timeline or reducing the scale of the project, which are alternatives that work in Malaysia’s favour while maintaining amicable ties with China.

The government should also keep SMEs in mind. Business owners in 150 related industries, including tens of thousands of contractors who have taken a loan to purchase equipment, will suffer greatly should the ECRL be cancelled.

China is Malaysia’s largest trading partner since 2009, with bilateral trade figures reaching US$100 billion. Business linkages and people-to-people exchanges have also flourished over the years. 

Products such as palm oil, birds' nest, Musang King durian, white coffee, etc., are exported to China, while people from both countries visit each other for vacations and academic exchanges, benefitting Malaysians of all races. All these have contributed to the income of various communities and brought in foreign exchange earnings for the country.

It takes years to build a bilateral relationship, and only seconds to destroy it. The government should appreciate our friendship with China, and try its best to achieve mutual benefits and common prosperity.

Prioritise the economy and the livelihood of the people, and put an end to the political game to discredit your opponents. For the sake of the people on the east coast, as well as the whole of Malaysia, the government should not cancel the ECRL project.

WEE KA SIONG is the MP for Ayer Hitam and the president of MCA.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.