Malaysian PM backs China-backed rail, pipeline projects cancelled for now

KUALA LUMPUR: Malaysian Prime Minister Mahathir Mohamad said on Tuesday that the Chinese-funded $20 billion East Coast Rail Link (ECRL) project and a natural gas pipeline project in Sabah will be cancelled for now, according to media reports.

Mahathir made the comments while addressing the media in Beijing during his five-day trip to China. He said the projects would be cancelled until such time as Malaysia can afford it. The Prime Minister`s office confirmed the comments Mahathir made to reporters in Beijing. 

Mahathir said he relayed the matter to China and they understood the problems faced by Malaysia, the New Straits Times (NST) reported. "I believe China itself does not want to see Malaysia become a bankrupt country," the NST quoted him as saying during a press conference marking the end of his China trip.

Mahathir suspended unpopular Chinese projects in Malaysia after he returned to power in a stunning election victory in May that ended the decade-long rule of former premier Najib Razak.

The ECRL project was the centrepiece of China`s infrastructure push in Malaysia but work has been suspended pending discussions over pricing and graft accusations. Mahathir said in a joint press conference with Chinese Premier Li Keqiang on Monday that he believed China would sympathise with his country`s "internal fiscal problems".

Prior to his China visit, he had vowed repeatedly to discuss what he called "unfair" Chinese infrastructure deals authorised by former premier Najib Razak. Mahathir also told the press on Tuesday that he did not bring up Low Taek Jho, the Malaysian financier wanted for his role in the multi-billion-dollar scandal at state fund 1MDB, in his dialogue with the Chinese leaders, local reports said.

The Wall Street Journal reported on Friday that Malaysia believed Low was being harboured in China and that a request to extradite him would be high on Mahathir`s agenda during his five-day trip. Reuters could not verify the report.