‘Loan for ECRL on favourable terms’

PETALING JAYA: The loan obtained for the East Coast Rail Line (ECRL) project from China is low interest and is on very favourable terms.

Barisan Nasional strategic communications director Datuk Abdul Rahman Dahlan said this to debunk former prime minister Tun Dr Mahathir Mohamad’s criticism of the soft loan which he had alleged would increase the country’s debts considerably and also that the main contractor of the project would be Chinese.

“The soft loan given by the Export-Import Bank of China is on very favourable terms with a low interest rate and has a 20-year tenure. It is also denominated in ringgit and not in US dollars or yuan as alleged by Mahathir,” said the minister in the Prime Minister’s Department.

Abdul Rahman also clarified that although the main contractor will be China’s largest construction company, “our agreement is that a significant portion of this work will be subcontracted to local companies and there will be knowledge transfer as well”.

“Due to the rapid development of rail links in China over the past two decades resulting in a rail network of more than 125,000km, there is little doubt that China is now among the leaders in railways and rail technology.”

He also pointed out that some of the major projects during Mahathir’s tenure involved foreign expertise, namely KLCC where the architect was an Argentinean, Tower 1 was contracted to the South Koreans while a Japanese company built Tower 2.

“It is regrettable that Mahathir repeats the allegation that on a per kilometre basis, the ECRL at RM55 billion is over priced. These allegations have already been proven untrue by answers provided by (Transport Minister) Datuk Seri Liow Tiong Lai and myself.”