“Cost Too High”: Malaysia scraps multi-billion dollar China-backed rail project

Kuala Lumpur: A multi-billion dollar China-backed rail project in Malaysia has been scrapped, government officials said, adding that the cost of building it was too high.

Economics minister Azmin Ali told reporters, “The cost of the east coast rail link (ECRL) development is too big, so we have no financial ability at this time.”

He said that if the project was not terminated, Malaysia would have to pay an annual 500 million ringgit interest payment.

Malaysia’s previous government under Prime Minister Najib Razak had warm ties with China and signed up to a string of Beijing-funded projects.

But critics say many of these deals lacked transparency, fuelling speculation they were made in exchange for help in paying off debts from a massive financial scandal involving state fund 1MDB.