Malaysia-China relations have hit rock bottom, and Mahathir knows it
THE THIRD FORCE
Dr Mahathir Mohamad has issued a stern warning to China against further militarising the South China Sea (see news item below).
Speaking to The Associated Press days ahead of his visit to Beijing, the Prime Minister announced that he would seek to cancel multibillion-dollar infrastructure projects that his predecessor, Dato’ Seri Najib Tun Razak, signed with China.
The projects include the 55 billion ringgit East Coast Rail Link (ECRL) and the 4.5 billion ringgit oil and gas pipeline in Sabah, both of which are backed by China’s Export Import (EXIM) bank.
Mahathir alleged that the projects did not benefit Malaysia in any way and contributed immensely to the national debt, which he maintains to this day is way past the RM1 trillion mark.
But analysts beg to differ.
According to them, it made no sense for the Government of Malaysia (GoM) to provoke China as a significant number of Chinese-backed projects such as the Forest City development do not constitute as debts, but investment.
They further note that the ECRL project could not possibly make up a large portion of the government’s liabilities as the project, upon completion, had the potential of generating revenue through the spurring of development across the Port Klang – Pengkalan Kubor stretch.
As a matter of fact, Najib himself revealed that the Chinese government committed to importing goods worth US$2 trillion over the next five years from Malaysia during the signing of a Memorandum of Understanding (MOU) for the Sabah pipeline projects.
He added that China agreed to invest up to US$150 billion in Malaysia and even offered 10,000 places for training and studies in various Chinese institutions.
So it came as a surprise to me that Mahathir is actually thinking of scrapping projects Najib signed with the Chinese government.
These projects serve only to benefit Malaysians of all walks and is in no way a burden to our country and its economy.
It seems ironic to me that he keeps harping on debt reduction when his own economic advisor, Daim Zainuddin, attempted to renegotiate the ECRL deal at a revised cost that was RM15 billion upstream of what Najib negotiated.
Perhaps it has to do with the ‘temporary’ ban Chinese foreign minister Wang Yi triggered on the signing of new deals with Malaysia.
