KUALA LUMPUR: Former prime minister Datuk Seri Najib Razak has called for a Royal Commission of Inquiry (RCI) on the three China-linked projects approved during his administration.
These include the East Coast Rail Link (ECRL), and the two Strategic Energy Resources (SSER) pipeline projects.
He said the government should initiate the RCI to determine “if there is wrongdoing.”
"The people deserve to know if the decision to cancel the projects was based on reasonable and solid grounds, and not made out of anger towards the past Barisan Nasional (BN) government or China which has refused to bow to Pakatan Harapan's demands," he said in a Facebook posting.
He also called on the government to reveal all agreements, feasibility studies, economic impact assessments and cost-benefit analysis so that the people can determine if Putrajaya should continue or scrap the projects.
“Until this is done, I am sad and disappointed that the people in the east coast will lose out on a development project which was aimed at boosting the economy in their states to be on par with the west coast.”
Touching on Prime Minister Tun Dr Mahathir Mohamad’s comment on the “stupidity” of Najib’s government in negotiating contracts and deals which the government was now trying to untangle. Najib said contracts negotiated with Chinese companies actually had exit clauses.
“This is unlike all the Independent Power Producer (IPP) concession agreements or the toll agreements which were signed during Dr Mahathir’s time.
“We can see how even the PH government is unable to fulfill its promise to abolish toll until now,” he said.
Najib said he wanted to clear the misconception that had arisen following the government’s decision to scrap the ECRL.
He claimed the situation was made worse due to “propoganda” about the project.
On claims that the ECRL cost too much and Barisan Nasional (BN) had received kickbacks from the project, he said many had questioned how it had escalated from the initial cost of RM30 billion to RM55 billion.
He explained that the RM30 billion figure was based on studies done in 2009 for a 545km track.
“This was later extended to 620km and the allignment for the track was also changed to make it more efficient and to avoid too much land acquisition.
“Then a 50km tunnel was needed across the Titiwangsa range. This was phase one of the project which cost RM46 billion in 2016 due to inflationary costs and also the weak ringgit. If this project is done seven years from now it will definately cost much more, just like the Penang Transport Master Plan (PTMP) which has escalated from RM27 billion to RM50 billion,” he said.
Najib said the government had then also decided to extend the rail link from Gombak to Port Klang, bringing the total length to 688km.
He said by doing so, the ECRL would have become a competitor to the Port of Singapore, as it would have saved shipping companies an additional one and a half day of sailing through the port.
“This was supposed to be phase two of the project which would have cost RM9 billion, bringing the total coast to RM55 billion in 2016,” he said.
Najib also dismissed claims that loans taken from China would have incurred high interest rates.
He said the 20-year loan taken from China was at 3.25 per cent interest and protected from any fluctuation in currency exchange, unlike loans taken from Japan during Dr Mahathir’s time which skyrocketted when the Yen strengthened.
On claims that the government could not afford all three projects, Najib said the government only needed to pay RM4.5 billion over 20-years, with the first seven years given an exemption.
On allegations that payments made to the contractors did not commensurate with the work that had been done, he said a big chunk of the payments was for the purchase of tunnelling machine.
He said the projects had also been awarded to three of the biggest China-based companies and payments were made directly to the Exxim Bank in China.
“The risk that the companies would not be able to complete the projects was very low.”
Najib also dismissed claims that the projects were not feasible and would not have given any returns to the country.
He said apart from obvious economic activity generated by the ECRL, it would have also provided 80,000 job opportunities to people in the east coast states.
"The ECRL is already 20 per cent completed. With the cancellation, all the projected benefits would be lost
“It looks like the east coast states will remain at the level they are without any chance of catching up with the west coast states,” he said.