Mahathir stops the establishment of MRT because it will add Malaysia debt

News24xx.com -  From the calculation, foreign debt of Malaysia increased by USD 50 billion or equivalent to IDR 700 trillion. To overcome the growing debt of the country, Prime Minister Mahathir renegotiated a number of railroad projects. The project had previously been agreed by the previous Malaysian government with the Chinese government as a partner.

Reported by Reuters on Sunday, May 27th 2018, the renegotiation is done on the East Coast Rail Link project with a value of MYR 55 billion or equivalent to USD 13.82 billion.

The length of the railway project is 688 kilometers, will connect the northeast border of the South China Sea to the Straits of Malacca in the West. This is mentioned to help the strategic shipping lanes of the world.

The project is being undertaken by China Communications Construction Co Ltd, and most of it is financed by loans from China Exim Bank. "Because it is very destructive, it is necessary to review again and remember the need for the project so we are renegotiating the requirements" Mahathir said in his statement.

Another project to be reviewed is a high-speed train project that has been agreed with Singapore. The project, which needs about USD 17 billion, is currently awaiting the tender and is scheduled for completion in 2026. It will stretch from the capital Kuala Lumpur to Singapore.

"For the High Speed ??Train agreement we decided to cancel the project because it will cost money" Mahathir said.

Currently, Malaysian government debt reaches more than one trillion ringgit or about USD 251.32 billion, equivalent to IDR 3.514 trillion or 80 percent of Malaysia's Gross Domestic Product. With the cancellation of a number of projects Malaysia is expected to save debt burden of USD 50.26 billion.

 

 

 

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