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Thursday, January 31, 2019

That ministerial disagreement over ECRL



QUESTION TIME | Just the other day, during the long Thaipusam weekend, we took a drive to the East Coast, specifically Terengganu. The laid-back atmosphere, the still unspoilt beaches, clear blue skies and the unseasonably good weather for this time of the year lured us back to this resort we like.
And the roads, yes the roads. It’s easily possible to make it there from Kuala Lumpur in about three-and-a-half hours driving at a leisurely pace - make it four hours with a short break for coffee. Did not use to be like that though - a good seven to eight hours before.
The difference was the new highway from Karak, not long after the Genting turn off if you are heading east from Kuala Lumpur, that leads all the way to Kuala Terengganu. On the day that we drove up, it was all but deserted - on a Saturday with a long weekend ahead. When we returned on a Monday, despite it being a public holiday on the West Coast, traffic was easy all the way to Kuala Lumpur.
Our major complaint was a poor Temerloh stop along the East Coast Expressway - that’s what it is called - for a short break before resuming our journey. Food was very limited, it was crowded and there were flies in abundance landing on all the uncovered food. Unappetising, to say the least, but the roads were clear.
With the main thoroughfare between Klang Valley and the East Coast cities showing such lack of traffic 15 years after the Karak-Kuantan section was completed back in 2004, what is the pressing need to build the very expensive East Coast Rail Link or ECRL that is to cover pretty much the same towns?
Prime Minister Dr Mahathir Mohamad himself now expects the ECRL project to cost more than a massive RM100 billion. That could well work out to be the case as I explained in an earlier article.
Finance Minister Lim Guan Eng had earlier put the revised cost up from RM55 billion by the previous regime to RM81 billion, including interest costs and other expenses. Costs will be high - very high - whichever way we look at it. Even RM55 billion is not an amount to be sniffed at and it is likely to be much more than even that.
The ECRL is already a rather controversial project because reports have it that even the original price of RM55 billion was already some RM20 billion over the usual price. The reports further continue that, together with another China pipeline project to nowhere of some RM10 billion, it would have provided in all some RM30 billion to the Najib Abdul Razak regime, enough to close off that RM30 billion huge gaping hole in strategic development company gone wrong, 1MDB.
Even Mahathir conceded that this appeared to be the case. That also was the only possible explanation for why some RM20 billion was paid out to a company set up outside Malaysia to receive payments for the ECRL project, the agreement for which was already signed by the previous government.
As if all of this was not enough for a major controversy, two ministers, Lim and Economic Affairs Minister Azmin Ali contradicted one another. Azmin said the project was cancelled but Lim said it was not quite cancelled and to wait for an announcement.
And to add to the confusion, Mahathir weighed in with his two sen worth to say that both Lim and Azmin were right but the timing was off. How could two people be right about contradicting things? Was it right before and not right now? Even with Mahathir’s now famous/infamous cryptic and puzzling double-speak in reply to reporters’ questions, one is pretty hard put to make sense of that.
There’s a gaffe here - unless it was a manufactured gaffe aimed at wrenching concessions out of a rather tight-fisted China for an amended contract. Remember, adding to that morass of unexplained lack of clarity, others are also negotiating with China - Mahathir’s trusted lieutenant and a controversial figure in his own right, former finance minister Daim Zainuddin.
One hand clapping
The latest is this - the cabinet has barred ministers from talking about the ECRL and decided that negotiations with China should continue in private (if both Lim and Azmin are here in Malaysia, who is conducting the negotiations?) They can’t even discuss the ECRL negotiations. How undemocratic!
Somewhere, the right hand is clapping when the left hand stays still and there is some confusion, too, over who is clapping and who is not. The ECRL comes under the Finance Ministry, apparently, but Azmin could be forgiven for thinking that it is under his ministry too - if the ECRL is not an economic affair, what is?
Daim (photo), the unofficial, unpaid adviser to Mahathir, has gone on record to say that prime ministerial prerogative allows Mahathir to appoint whoever he wants, including a durian minister, if he thought that would help the country. He blatantly ignored the fact that Mahathir is a minority PM as his party holds too few parliamentary seats, unlike when he was Umno head honcho and PM.
Of course, that is the line Daim will take after having been the past and current beneficiary of prime ministerial prerogative in terms of the power he wields in government and in the corporate sector. This time he is not even in government. As a corporate czar, even he must agree that one entity divvied up among three different people - Daim, Lim and Azmin - make for rather confusing lines of responsibility, especially when they all report to one person above them.
Breaking down everything, the current puzzle arises because of a very last minute change to initiate new negotiations with China to revive that worthless ECRL project. The Star has reported as much - something about the cost being cut to around RM40 billion from around RM70 billion.
It confounds things even more. If we take it that the previous cost was inflated by RM20 billion because of that 1MDB hole, then the original cost was RM35 billion (RM55-RM20). Where did that RM70 billion come from? And why even consider paying RM40 billion, which is RM5 billion above original? I remember a local contractor saying he can build the entire thing for RM10 billion.
It is very clear to all sane, rational and honest people (how we lack such people in government) that we don’t need an ECRL now. Let the East Coast Expressway at least get crowded first - that may take another 20 years. Then re-evaluate the project. Why are we rushing headlong to build a project that suits China and will ultimately benefit it by providing a cheaper passage for its goods?
Are we still beholden to China after the regime change? If so, why? And who is benefiting? Are we not supposed to have a government, now after the elections, that is truly transparent, accountable and practices good governance? Is that not what Harapan promised? Why is it reneging on its solemn promises? Has money become more important, yet again?
Even if China built the ECRL for free, it will cost the government hundreds of millions of ringgit a year to run it - and it will be money lost year after year because there won’t be profits because of lack of throughput.
It is sheer madness to build the ECRL for at least RM40 billion and perhaps even more than that just to pacify China and smoothen ruffled feathers. Why should we? Take the matter up for international arbitration, if need be.
I have explained recently here why we don’t need the ECRL, and earlier here. We can just unambiguously and clearly reject the ECRL for three reasons - we don’t need it, a very corrupt government signed it and it was an illegal act. Full stop.

P GUNASEGARAM says that those who make obviously wrong decisions have ulterior motives. E-mail: t.p.guna@gmail.com - Mkini

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