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Malaysia Government will renegotiate with China the terms of East Coast Rail Link Project (ECRL)

    Yi  Wei
    By Yi Wei Replies (2)

     

    Malaysian Government plan to renegotiate with China over East Coast Rail Link Project (ECRL). 

    Current government of Barisan Nasional (BN) coalition want to undo some of changes made by previous government of PH. One important change was alignment of RCRL route to avoid construction of one 17.8 kilometer long tunnel via Ridge Quartz Klang Gates. Current Barisan Nasional government want original route to brought back in new realignment.

    This can not be maybe so easy. Because PH government also renegotiated very important other things with Chinese. For example on 12 April 2019 there was Supplementary Agreement signed between China Communications Construction Company Ltd (CCCC) and Malaysia Rail Link Sdn Bhd (MRL). With that supplementary agreement the project cost reduced from original RM65.5 billion to RM44 billion. A very sharp decrease.

    Not only this. CCCC even agreed to return part of prepayment of the RM3.1 billion. In addition, the share of Malaysian subcontractors and suppliers to project increased from 30% to 40%. In addition, Chinese accept to bear 50% of the risk, instead of 0%.

    Of course it was a "give and take"negotiation like in any agreement. The trade off for getting concessions from Chinese was that, Chinese get 20% of profits (up from 0%) and also get 50% of operations and maintenance of ECRL.

    These last things that PH government wants to roll back. PH thinks a national security issue giving 50% of management of important infrastructure project to foreign country.

    It will be very difficult renegotiation. I know it will cost Malaysia. Why Chinese give of 50% after so much advantages they gave to Malaysia in previous government?

    The following article give detail of everything

    https://www.sinarharian.com.my/article/100445/KOLUMNIS/Berita-gembira-untuk-pantai-timur

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