Lim: RM10b refund available if ECRL scrapped

Govt yet to decide as negotiations currently underway with project’s Chinese contractors


The government could recover RM10.02 billion from the project’s Chinese contractors if the East Coast Rail Link (ECRL) project is shelved, said Finance Minister Lim Guan Eng (picture).

He said the government had to-date paid a total of RM19.68 billion to ECRL’s main contractor, China Communications Construction Co Ltd (CCCC), which comprised a RM10.02 billion advanced payment bond and RM9.67 billion for works completed as at Feb 15, 2018.

“It must be stated that the advanced payment bond can be redeemed by Malaysia Rail Link Sdn Bhd (MRL) if the project is terminated,” he told the Dewan Rakyat yesterday.

The government has not decided on the final status of the ECRL project, which is estimated to cost over RM80.9 billion, as negotiations are currently underway.

“Four sessions of negotiations have been conducted since July 2018,” he said in reply to a question from Tan Sri Noh Omar (BN-Tanjung Karang), who asked the government to state the latest update in the negotiations.

“MRL and CCCC have also conducted several technical discussions between July and October to look into suggestions and steps to reduce the costs to complete the ECRL project.

“However, until now, MRL and CCCC have not reached any agreement on the suggestions to reduce the costs,” he added.

MRL is a company under the Ministry of Finance. The ECRL was not included in the list of high-impact projects under the mid-term review of the 11th Malaysia Plan (2016-2020) revealed last week.

Meanwhile, Lim expressed his preference to the Central Spine Road (CSR) compared to the ECRL.

The minister said the CSR, which links the east coast of the peninsula to the west, can benefit those who live in the east coast region without overburdening the government, unlike the ECRL.

“The government must look at what we can afford. We will be burdened and we can’t afford to pay RM81 billion (for the ECRL). We haven’t taken into account the interest rate over 20 years due to the loan, as well as the operational expenditure of RM1 billion a year. It will be a recurring loss.

“If, and I say if because we have not made a decision, the government decides to abandon this project (ECRL), I prefer the CSR because it can give greater benefits to the public.

“It will make life easier for those returning home to the East Coast. This is my personal view and we are committed to see the CSR completed,” said Lim.

The CSR, previously known as the Kuala Krai-Kuala Pilah Highway or Federal Route 34, is a new highway being constructed in the centre of the Peninsular Malaysia.

The 325km toll-free highway will replace the former two-lane Federal Route 8 Gua Musang Highway and Federal Route 9 Karak–Tampin Highway.