Malaysia seeks sharp cuts in $20 bln China-backed rail line

Malaysia seeks sharp cuts in $20 bln China-backed rail line

Malaysia’s government has said a major China-backed rail link project can only be viable with a “drastic” price reduction by the Chinese contractor as the actual cost of the venture is 81 billion ringgit (USD 20 billion).

The 688 kilometer (430 miles) East Coast Rail Link is a key part of China’s regional Belt and Road infrastructure initiative. It would connect Malaysia’s west coast to rural eastern states. It is largely financed by China and the main contract was awarded in 2016 to the China Communication Construction Company, or CCCC, by former Prime Minister Najib Razak, who was defeated in May 9 elections.

Finance Minister Lim Guan Eng said the project final cost, which is nearly 50 percent higher than that estimated by the previous government, includes land acquisition, interest, fees and other operational costs. The 81 billion ringgit doesn’t include operating costs, he said. Read More

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