Published: Fri, July 06, 2018
Global News | By Blake Casey

Malaysia Investigates China-Backed Project Links With Scandal-Ridden State Fund

Malaysia Investigates China-Backed Project Links With Scandal-Ridden State Fund

Mahathir said in the interview he was disappointed as Saudis did not deny involvement in the case, but he also said that so far there is no proof of the country's role.

The deals were among several Beijing-backed projects signed by scandal-hit Najib, who was unseated by his former mentor Mahathir Mohamad in elections last May.

His trip to Beijing has been provisionally agreed for mid-August, according to one source involved in planning it.

The company said the suspension would not have a significant impact on its operating performance in 2018.

The sources spoke on condition of anonymity as they were not authorized to talk to the media on the subject.

China's Foreign Ministry did not immediately respond to a faxed request for comment.

East Coast Rail Link will connect the South China Sea in the east coast of Peninsula Malaysia with strategic shipping routes in the west and is a major part of China's infrastructure push across Asia and beyond.

He rhetorically asked Najib, whom he said "has been active on Facebook recently", to explain how he could have approved such a contract, which he called "lopsided".

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Malaysia's new government said Thursday it was suspending a trio of Chinese-backed rail and pipeline projects in the country, citing concerns over combined costs estimated to run as high as USA $23 billion.

Mahathir has been highly critical of the benefits of certain Chinese projects in Malaysia. Since taking office, he has vowed to renegotiate terms even as construction work continued.

Kuala Lumpur: The project owner of Malaysia's $20 billion East Coast Railway Link has told its main Chinese contractor to suspend work, both companies said on Wednesday, raising uncertainty about the future of part of China's Belt and Road plan.

The other two projects are a petroleum pipeline stretching 600 km (373 miles) along the west coast of peninsular Malaysia and a 662-km (411-mile) gas pipeline in Sabah, the Malaysian state on the island of Borneo.

It says the decision was not targeted at any country.

"In Malaysia, everyone is concerned about the ECRL project, very similar to [the port project in] Sri Lanka", CCCC chairman Liu Qitao was quoted at a panel discussion at a Belt and Road Initiative summit in Hong Kong.

"It's sending a message to the Chinese", said one of the sources, a senior finance ministry official.

Malaysian government officials say the project's estimated cost of 20 billion dollars is too high.

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