KUALA LUMPUR:A multi-billion dollar China-backed rail project in Malaysia has been scrapped, government officials said, adding that the cost of building it was too high.
Malaysia has in recent months suspended several major projects signed under the country’s previous scandal-plagued regime, in a bid to cut the country’s massive one trillion ringgit (US$251 billion) debt.
Economics minister Azmin Ali said Malaysia made the decision two days ago on the 81 billion ringgit (US$19.6 billion) east coast rail link (ECRL) that would have connected the eastern and western coasts of the peninsula. “The cost of the ECRL development is too big, so we have no financial ability at this time,” he told reporters.
He said that if the project was not terminated, Malaysia would have to pay an annual 500 million ringgit interest payment. Malaysia’s previous government under Prime Minister Najib Razak had warm ties with China and signed up to a string of Beijing-funded projects.