CCCC seeks amicable solution

Dr Mahathir has called on the French leader Macron to reject the proposed ban on palm oil in biofuels, adding that the trade relationship between the two countries depended on mutual respect for each other's commodities.

PETALING JAYA: Amid the uncertainty on the future of the East Coast Rail Link (ECRL), the project’s main contractor China Communication Construction Co Ltd (CCCC) is said to be still holding out for an amicable solution.

Industry sources said news of the project’s supposed termination has shocked the Chinese company, as it has conceded to a lot in terms of what the Pakatan Harapan government had wanted, even to the extend of sharing operational costs post-construction.

Over the past few days, there have been conflicting views on the status of the controversial RM81bil project, which was suspended in July last year following criticism that the cost was too high.

Some 15% of the project, to span across four states, was completed at that point.

According to sources, China’s CCCC had agreed to bring the cost down closer to RM40bil range compared with the original cost of closer to RM70bil for the entire project – phase one and two included.

In the re-negotiations, it had also agreed to allow 40%-50% local participation from 30% originally, sources said.

But perhaps the biggest feat was getting the Chinese company to share operational and financing risks once the project is completed, sources said.

This is opposed to CCCC’s initial role as only a contractor, which is to build the rail line and hand it over to asset owner Malaysia Rail Link Sdn Bhd.

According to sources, considering that the CCCC has given up so much in the re-negotiations, it is not taking it (talk of termination) lightly.

Some believe the government is now weighing how to do it diplomatically.

However, sources said that in its mitigating letter, CCCC is still open to resolve the issue amicably.

Yesterday, Prime Minister Tun Dr Mahathir Mohamad said the compensation for cancelling the ECRL project would be significantly lower than the debt the government would have to pay for the next 30 years if it was continued.

Dr Mahathir said Finance Minister Lim Guan Eng would soon give a clear explanation on the status of the project.

Last week, it was reported that two senior ministers seemed to be at odds with each other over the project’s status.

Economic Affairs Minister Datuk Seri Azmin Ali was quoted as saying that the Cabinet had decided on Thursday to cancel the project, but Lim later said he was “shocked” by the announcement.