CREC and IWH may team up for KL-Singapore high speed rail project
KUALA LUMPUR: China Railway Engineering Corp (CREC) and Iskandar Waterfront Holdings (IWH) could jointly bid for the Kuala Lumpur-Singapore high-speed rail (HSR) project.
CREC and IWH are currently joint-venture partners after having bought 60% equity in the Bandar Malaysia project for RM7.41bil from 1MDB Real Estate Sdn Bhd late last year.
Yesterday, CREC announced that it was committed to further invest US$2bil (RM8.12bil) to build its regional centre in Bandar Malaysia.
“We are indeed an infrastructure company. CREC and IWH are essentially in the same line, but we have to rely on CREC for its rail expertise,” IWH group executive vice-chairman Tan Sri Lim Kang Hoo told reporters following CREC’s US$2bil investment commitment in the development yesterday, which was officiated by Prime Minister Datuk Seri Najib Tun Razak.
CREC general manager and senior engineer Cai Zemin said the company would be interested to bid for the KL-Singapore HSR as it would be prepared to be involved in every aspect of the HSR development from design, construction, investment up to operations.
“We are now waiting for both Governments (Malaysia and Singapore) to decide on the mechanism or development model of the HSR,” he said.
CREC is also involved in providing end-to-end solutions in the recently announced US$5bil Jakarta-Bandung HSR,
Checks with MyHSR Corp confirmed that Malaysia and Singapore have yet to ink the bilateral agreement for the HSR development that would link both countries’ capitals. This bilateral agreement is a prerequisite in terms of providing further details on the reportedly RM40bil project to protect the interests of both countries and potential bidders.
It was reported that this agreement was supposed to be signed at least in the first half of this year.
As of now, the request for information jointly conducted by both countries, namely, Malaysia’s Land Public Transport Commission and Singapore’s Land Transport Authority, is vital to gauge market interest in the HSR, and how the market is expecting the implementation to be.
The project, however, has certainly attracted a lot of other foreign giants in railway construction like state-owned Korea Rail Network Authority as well as related entities from Japan, France, Germany, Spain and Taiwan.
CREC is one of the world’s largest engineering and construction firms, and also has businesses, among others, in industrial manufacturing, real estate development, and resources and mineral products. As of 2015, it was ranked number 71 in the Fortune 500, with a turnover exceeding US$100bil per annum.
Meanwhile, IWH is 40% owned by the Johor state government via Kumpulan Prasarana Rakyat Johor, with the balance 60% belonging to Credence Resource Sdn Bhd, a company controlled by Lim.
CREC’s investment and interest in Bandar Malaysia acts as a catalyst to attract further international players, many of whom have already expressed interest in the development.
Cai added that the gross development value of its project in Bandar Malaysia could be around RM160bil over a period of 20 years and is expected to kick off next year.