Malaysia finally scraps USD3 Billion (RM12.44 billion) China-backed pipeline plans

12-Sep-2018 Intellasia | New Straits Times | 6:00 AM Print This Post

Malaysia has finally scrapped three China-backed pipeline projects after halting work on them following the shock elections in May that saw an opposition alliance assuming power for the first time in the country.

A finance ministry spokeswoman confirmed that the country has canceled three China-backed pipeline projects.

The Financial Times earlier cited Malaysian Finance minister Lim Guan Eng saying he had sent a letter to “relevant parties” in Beijing to terminate the planned projects. The plans comprise of two oil and gas pipelines that cost more than USD1 Billion (RM4.15 billion) each as well as a USD795 Million (RM3.30 billion) pipeline that would link the state of Malacca to a refinery and petrochemical plant in the state of Johor, the paper reported.

Lim didn’t disclose the cancellation fees Malaysia would incur for canceling the pipeline projects but said that the lawyers were handling the matter, the report said.

Since taking office, prime minister Tun Dr Mahathir Mohamad has been reviewing infrastructure projects undertaken by the former administration. The cost-cutting efforts are aimed at tackling the country’s liabilities which have surged above 1 trillion ringgit due to state guarantees on borrowing by state investment firm 1MDB, which is at the centre of a multibillion-dollar scandal.

Lim also told the Financial Times that another China-backed projectthe East Coast Rail Linkwas under review. That project is being built by China Communications Construction Co.

In a visit to Beijing last month, Dr Mahathir warned against new ‘colonialism’ and called for free trade that was also “fair”.

Last week, Malaysia and Singapore agreed to postpone a multibillion-dollar high-speed rail project between the two countries until the end of May 2020.

https://sg.news.yahoo.com/malaysia-finally-scraps-usd3 billion-093807824.html

 


Category: Malaysia

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