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Malaysia to go ahead with China-backed East Coast Rail link
- Prime Minister Mahathir Mohamad’s office says first two phases of the project will now cost US$10.7 billion – about two thirds of the original cost
- The project stalled when Mahathir came to power last year and questioned various Chinese-backed projects signed up to by his predecessor Najib Razak
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Malaysia on Friday said it had a signed a fresh deal to proceed with the stalled China-backed East Coast Rail Link (ECRL), after months of false starts and contradictory statements from Prime Minister Mahathir Mohamad’s government on the future of the multibillion-dollar project.
The prime minister’s office said constructing the first two phases of the rail link would now cost 44 billion ringgit (US$10.7 billion), down from the original cost of 65.5 billion ringgit.
The new agreement “will pave the way for the resumption of the East Coast Rail Link project,” the statement said. “This reduction will surely benefit Malaysia and lighten the burden on the country’s financial position”.
The prime minister’s long-time confidante Daim Zainuddin, acting as special envoy to the leader, was in Beijing to conclude negotiations.
In a press conference after the government announcement, Daim said the rail link’s length would be reduced by 40km to 648km. The cost of building each kilometre of the line would drop to 68 million ringgit from 98 million ringgit, the former finance minister said.
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