On Tuesday, August 22, 2018, after his meeting with Prime Minister Li Keqiang and President Xi Jinping in Beijing, PM Mahathir announced that two China-financed giant infrastructure projects worth billions of dollars are cancelled for now.
The projects are the 688 km East Coast Rail Link (ECRL) that would have connected Malaysia's east coast with southern Thailand and Kuala Lumpur, and construction of two gas pipelines worth USD2,3 billion.
The Chinese government is said to understand that the decision was made because of Malaysia’s current situation. The Malay nation has ballooning national debt, which currently hovers around $250 million, according to the Malaysian Ministry of Finance.
Mahathir, who surprisingly won the election last May, lamented that those projects burdened Malaysia's finances.
"It's about pouring in too much money, which we cannot afford, cannot repay, and also because we don't need these projects for Malaysia at this moment," Mahathir said as cited in DW.
ECRL would be a significant part of Beijing’s Belt and Road infrastructure push. The project was negotiated in 2016 by Malaysia's ex-Prime Minister Najib Razak and President Xi.
Currently, Najib is in deep water for corruption-related offences over his alleged involvement in the multibillion-dollar 1MBD corruption scandal, the biggest on-going political scandal in Malaysia.
Source: Tempo.co, DW, Reuters