Soil erosion mitigation plans ignored, waters from stream identified as main cause !


 

A drone picture of the collapsed beams along Jalan Tun Sardon leading to Balik Pulau on the left while Jalan Paya
Terubong on the right leads to Relau.— CHAN BOON KAI/The Star
(Above) A closer view of the collapsed beams. (Right) The affected section of the project overlooking Jalan Paya Terubong heading to Relau in the background.

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Tragic Situation: (Top) A landslide at the construction site in Jalan Bukit Kukus, Paya Terubong, caused four containers to be covered with mud – Bernama,  Closed call:(Right below) Survivors of the landslide surveying the scene

 Checks show projects did not follow SOP

GEORGE TOWN: As the search and rescue operation for seven buried foreign workers at a construction site in Paya Terubong is going on, shocking information has surfaced that not a single construction site in Penang is following the soil erosion mitigation plan stipulated in their project approvals.

The Star has learnt that the state government has launched Ops Lumpur shortly after the general election, requiring enforcement officers from the local councils to inspect and report on every construction site in all five districts in the state.

A consultant civil engineer familiar with Ops Lumpur claimed that every single construction project did not observe the soil erosion mitigation plan.

He said Ops Lumpur was overseen directly by state exco members and enforcement officers were required to visit the sites.

“Their reports shocked the state exco members. Every contractor failed to do soil erosion measures in every site.

“Now you know why streams near construction site are always yellow when it rains,” he said.

The consultant engineer said the state went after developers who claimed they were not aware and blamed the contractors.

“Civil engineers are often disgusted when they do site visits because it is common for us to see that the soil erosion mitigation plans are never followed,” he said.

The consultant said it was easy to inspect construction sites and check on the progress and questioned whether state government agencies regularly conducted scheduled and surprise visits.

“How often do they conduct spot checks? How strictly do they conduct enforcement rounds on construction sites? If we keep contractors on their toes all the time, we might not have so many landslides,” he said, referring to the latest landslide in Bukit Kukus, the site of a hillside highway from Paya Terubong to Bukit Jambul is being built.

A teh tarik-coloured stream was observed flowing between Jalan Paya Terubong and the barred entrance to the highway construction site yesterday.

It has been raining almost every day in Penang this week.

In yesterday’s incident, rescue team found one survivor and two dead bodies. At press time, seven are still missing.

The Fire and Rescue Department received a distress call about the landslide at 1.56pm.

An Indonesian worker who only wished to be known as Endo, 36, said three of his relatives from Sulawesi were trapped in the landslide and he was working in another nearby construction site.

“It rained all night (Thursday). The rain stopped at 9am (yesterday) and resumed at 1pm. At my site, all of us stayed in our quarters and didn’t work because of the rain.

“I got a call from others that my relatives are missing. So, now I’ll just wait,” he said.

Last Thursday, 14 concrete beams measuring 25m long each, crashed down from an elevated section of the highway.

No injuries were reported and a stop-work order was issued pending investigations of the collapse.

Chief Minister Chow Kon Yeow, who visited the site with several state exco members, said he reminded rescue workers to be wary while searching for the missing victims because the rain could have rendered the slopes unstable.

“All work has stopped here and the contractor was about to send in its report on the collapse of the concrete beams on Oct 11,” he said, adding that the place where the beams collapsed was far from the landslide. – The Star by arnold lohlo tern chern

Water from stream identified as main cause of landslide

GEORGE TOWN: Water flow from a stream on the hilly area in Jalan Bukit Kukus, Paya Terubong, near here has been identified as among the cause of the landslide.

Azhari Ahmad, who is Mineral and Geoscience Department (JMG) director for Perlis, Kedah and Penang, said the finding was made based on its inspection and monitoring since Saturday.

“The JMG team identified several factors that caused the landslide, resulting in all containers on the hill slope to slide down with the earth.

“The main factor that caused the landslide is the water flow from a stream near the slope and heavy rain since Friday morning caused the water to overflow,” he told reporters yesterday.

Azhari said the department had taken immediate measure by diverting the flow of water from the stream elsewhere to avoid worsening the situation, especially during the search and rescue (SAR) operation.

He said further inspection conducted at 7.30am yesterday found the water flow on the slope was lesser but the department would continue to monitor the situa­tion with equipment from the Special Malaysia Disaster Assistance and Rescue Team to ensure the safety of SAR personnel.

He said based on observation and inspection at the scene, the department found the location of the landslide to be at the concave slope which easily collected water.

“But we do not rule out the possibility of a follow-up landslide in the area due to the soil structure and there is still water flowing that can cause landslide.

“We have also advised the rescue team to stop operation immediately if it rains as it could cause another landslide,” he said.

Azhari said the department was assisting the rescue team in the SAR operation and did not rule out the possibility of it conducting further investigation to determine the ac­­tual cause of the landslide.

“We hope for fine weather and no rain so that the SAR operation can be continued until all the victims are found,” he said.

The landslide occurred at about 1.30pm last Friday.

The tragedy occurred following heavy rain in the state from Thurs­day afternoon until noon the following day, causing the landslide at the container and kongsi area at the Bukit Kukus paired road construction site.

Source: Bernama, Reports by LO TERN CHERN, N.TRISHA and R.SEKARAN

 

Related stories:

 

Zairil: Contractor to face action if accident due to negligence – Metro

 

 

Wake up and stop the landslides, state govt urged – Nation

 

Wake up and stop the landslides, state govt urged – Nation

 

 

DOSH: Builders told to stop work, but did not – Nation

 

CAP urges Penang govt to issue stop work order on hillside

 

October and November turning into ‘disaster season’

 

‘Put safety measures into place at construction sites’

Related post:

Precarious situation: The collapsed beams along Jalan Tun Sardon which fell and broke after being knocked down. https://www.thestar.c

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Golden opportunity for DAP leaders to practise what they preached


In May this year, we voted for a change of government at both state and federal levels after 61 years of suffering under the yoke of Umno and its partners. We voted for hope and change.

The Pakatan Harapan (PH) parties went from being in the opposition to becoming the government of the day. When they were opposition politicians they could only voice their objections and concerns. But today they are in power to carry out what they hoped and fought for. Are they carrying out the trust that we placed in them?

Let us examine this in relation to the biggest project confronting the people of Penang (also one of the largest mega projects in Malaysia): the RM46 billion Penang Transport Master Plan (PTMP), and more immediately, phase 1 of this plan – the proposed Penang Island Link 1 (PIL 1) and the LRT project. The PIL 1 is an extension of the aborted Penang Outer Ring Road (PORR).

What did our present Chief Minister Chow Kon Yeow say when he was the opposition MP in 2002? “If the findings of the Halcrow Report are true, Dr Koh would be irresponsible in pushing the PORR through as this will not be a long-term solution to the traffic congestion on the island…”

There were two other minor reasons why Chow opposed the PORR: because it was a tolled road and no open tender was used to award the project. But these cannot be the main reasons for opposing it.

And what did Lim Kit Siang say on May 28, 2002?

“The nightmare of the Penang traffic congestion is likely to be back to square one, not in eight years but probably less than five years, after the completion of PORR.

“What Penang needs is an efficient public transport system based on sustainable transport policy, as PORR is not a medium-term let alone long-term solution to the traffic congestion nightmare on the island.”

Since these two DAP leaders could not be clearer on why they opposed construction of the PORR as it would not solve traffic problems, how does Chow now justify the PIL 1?

According to the environmental impact assessment (EIA) of the PIL 1, the consultants reported that by 2030 (between five and seven years after completion of PIL 1), traffic volume will reach up to 8,000 pcu/hour (passenger car unit) during evening peak hours.

Translated into layman’s terms, we would be back to square one in terms of traffic congestion. This was exactly what the transport report of 1998 by international consultant Halcrow said of PORR. Back then, Chow asked Koh Tsu Koon (then Penang’s chief minister) to disprove Halcrow’s findings. Today we ask Chow the same question.

Public policy must be based on scientific study, analysis and evidence, not on whims and fancies. (That is why the Penang state government funds the Penang Institute to provide sound policy analysis and advice.) If the EIA’s conclusion is that the PIL 1 will not solve traffic congestion in the medium and long term, then the chief minister must justify to the people of Penang on what other grounds he based his decision to spend RM8 billion on one highway that will not solve Penang’s traffic congestion and is fraught with safety risks, on top of financial, environmental, social and health costs. How should he explain his volte-face?

Lim Kit Siang made it clear that the only alternative is to have an efficient public transport system. This is a golden opportunity for these leaders to implement what they preached. The chief minister said at a town hall meeting on Sept 20 that the state is proposing a balanced approach to solving the transport problem: building roads and public transport.

Let us examine the actual facts.

1. Penang island presently has 2.8 times more highways on a per capita basis than Singapore (84m per 1,000 persons in Penang versus 30m per 1,000 persons in Singapore).

2. The state government under the PTMP is planning to build another 70km of highways, many of them elevated, marring the city landscape and thereby doubling our highway per capita to 4.5 times that of Singapore.

3. Presently Penang’s public modal share of transport is dismal at 5%, i.e., only 5% of people who travel use public transport, compared to 67% in Singapore.

From the above, it is clear that Penang’s transport situation today is totally tilted towards roads and against public transport. Hence a balanced approach must mean prioritising improvement of public transport and not the construction of more highways that encourage more private road use.

The primary objective of the PTMP is to raise public modal transport share to 40% by 2030. But spending RM15 billion on building highways in the first phase of the PTMP (RM8 billion on PIL 1 plus RM6.5 billion on the three paired roads and tunnel under the Zenith package) and RM8 billion on one LRT line is NOT a balanced approach.

In fact, under the Halcrow PTMP, an integrated public transport network consisting of trams, bus rapid transit, commuter rail and a new cross-channel ferry service was estimated to cost RM10 billion. But all these are shelved or relegated to future dates while priority is given to building highways. The chief minister must explain to the people of Penang why such an unbalanced approach is adopted. Is the policy based on scientific evidence or on other types of interests that we are unaware of?

The saying that “justice must not only be done but must be seen to be done” aptly applies in this case. The people of Penang must have clear and credible answers to dispel any possible misgivings.

I respect and have worked with Chow for the last 10 years on the Penang transport issue.

I recall what he told Koh: that if the findings of the EIA report are true then Koh would be irresponsible in pushing the PORR.

Now, in the case of PIL 1, the arguments are even stronger that this will not be a long-term solution to the traffic congestion on the island.

Source: FMT by Lim Mah Hui

Lim Mah Hui is a former professor, international banker and Penang Island city councillor.

The views expressed are those of the author and do not necessarily reflect those of FMT.

Related posts:

New mode of public transport, the ART (Autonomous Rail-Rapid Transit) for Penang, wait no more !

 

Penang Forum calls to review Penang mega projects

 

Penang new Chief Minister taking Penang to the next level

 Go-ahead likely for Penang LRT

 

Penang Island City Council, MBPP councilor Dr Lim fed up change not happening in Penang

 

 Penang Transport Master Plan (PTMP) – Tunnel project rocked, Directors arrested in graft probe

Penang’s eight transport plans unfulfilled, Not even one commenced work, says Teng

 

Rage against hill road plan: We don’t want that road, says Penang residents 

 

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PTMP: Losses making fashion company in Penang Undersea Tunnel Project

Tough questions on Penang turnel project; Engineering Consultant arrested in probe

China tycoon to invest RM10b in M’sia, ADB debunks BRI ‘debt trap’ concerns


https://youtu.be/4bhexUMxO0w

China tycoon to invest RM10b in Malaysia

Yan Jiehe says country is business friendly, with strong fundamentals

China’s Pacific Construction Group Ltd (CPCG) gave Malaysia a vote of confidence with a planned RM10bil investment over 10 years in areas including infrastructure development and hi-tech machinery.

Yan Jiehe (pic), founder of CPCG, which is No. 96th in 2018 Fortune Global 500, said Malaysia “is business friendly, and one of the most competitive countries in the region”.

“The country’s fundamentals are strong. You have excellent infrastructure, a robust eco-system and a big pool of trilingual talents. Kuala Lumpur, is thus, a strategic launch pad for our expansion into Asia Pacific.

“We plan to invest up to RM10bil over 10 years in Malaysia in line with our core business areas of infrastructure development, hi-tech machinery and education,” he said in a statement.

Yan also said CPCG was open to increasing its investment especially for federal projects that would benefit the people.

“With our track record of having successfully delivered complicated construction projects in China, we are confident that, in collaboration with local partners, we will be able to do the same in Malaysia,” he said.

The group, in a move to make it easier to invest in Malaysia and across Asia Pacific, CPCG has set up CPCI Holdings Sdn Bhd, a wholly-owned subsidiary in Kuala Lumpur as its regional technical competency centre.

CPCI is involved in a RM200mil construction project in Sahabat, Sabah.

“Within the next five years, we plan to employ 150 highly skilled professionals of which more than half will be Malaysians as we position CPCI as a major player across the Asia-Pacific region. These trilingual local talents will be invaluable to work on the group’s projects worldwide,” Yan added.

With CPCI, the group would be able to optimise its operations by centralising its regional decision-making and key activities in Kuala Lumpur including accounting, strategic business planning, business development, bid and tender management, as well as engineering services.

Under its education strategy, CPCI plans to set up business schools and universities, and provide scholarships to local students. As a start, CPCI will provide up to 500 scholarships for construction and engineering students in local universities.

On the group itself, CPCG had a total revenue of RM319bil and it is the biggest private-owned construction company in the world. Founded in 1995 by Yan, CPCG was named as one of the Top 500 Chinese enterprises. It is one of the largest integrated construction groups in China and Asia in terms of the total engineering contract revenue. – The Star

 

ADB  Panel debunks ‘debt trap’ concerns

 ‘Belt and Road Initiative not out to cause hardship to recipients’

KUALA LUMPUR: The Asian Development Bank (ADB) and two China watchers do not believe that China is using its Belt and Road Initiative (BRI) to practise debt diplomacy and causing hardship to recipient nations.

“I don’t buy the notion of China practising debt diplomacy. It is not a sustainable model.

“I don’t think this is the objective of the Chinese government in launching the BRI,” said ADB vice-president Stephen Groff.

Groff told a regional China Conference here yesterday that the failure of some BRI recipient countries to repay loans was due to their “lack of capacity”.

China’s ambitious BRI, which spans more than 65 countries, has given rise to criticism that it will drag developing countries into debt they cannot repay.

Malaysia recently cancelled several projects, saying it could not afford to implement them.

Reminding accusers of China to adopt an evidence-based approach, Groff said countries should look at their capacity when coming to the negotiating table.

At the same panel discussion on “Avoiding Belt and Road debt trap”, Prof Dr Belal Ehsan of International Centre for Education in Islamic Finance said China’s BRI had played an important role in infrastructure investments in Asia.

“Every country in the world is corrupt. It is a question of degree. China now needs a new financial architecture for BRI.

“It cannot be debt-driven but risk-sharing and profit-sharing (like Islamic financing) so that no one is a loser in the end,” he said.

Describing the “debt trap” as a concoction of Western governments and media, chief economist of IQI Global Shan Saeed said: “The rise of China is inevitable, whether you like it or not.

“The US government, media and people do not understand history and culture.

“China has 5,000 years and US only 250.

“In the Western world, everything about China is bad. The time has come for us not to listen to the Western media and be dictated by Western policies.”

To reduce risk in BRI projects, Saeed proposed loans be denominated in local currency or yuan, and not in the US dollar.

ADB believes that adopting transparency and international standards in financing will also help nations reduce risk.

“Institutions have learnt from experiences in the 1990s on debt problems.

“It has taught us the importance of transparency and sustainable framework,” said Groff. – The Star by Ho Wah Foon

 

Related:

 

IMF’s Lagarde warns against trade, currency wars, urges … – Reuters UK

 

 

Jack Ma: US will suffer more in trade war 

 

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New mode of public transport, the ART (Autonomous Rail-Rapid Transit) for Penang, wait no more !


ART – Can be completed within 1 year for Penang lang, wait no more ! 年内就可以通车。槟城人,要不要?!

The ART (Autonomous Rail-Rapid Transit) was nominated for an award in the “Beazley Designs of the Year 2017,” which was organized by London’s Design Museum to celebrate the world’s most innovative design ideas.

note: Autonomous rail-Rapid Transit (ART) costs 90% cheaper than LRT.

> 150 delegations from over 20 overseas cities have visited the project, its developer said.

自去年2017年6月发布以来,前来株洲所考察智轨列车的团体超过150批次,其中包括美国、英国、新加坡、新西兰、巴西等国家的20余个海外城市。

槟城,您还在等什么。还要LRT等七年,堵七年吗?


ART Intro Video

How trackless trams could revolutionise Perth’s public transport


Beautiful Malaysia

Georgetown, Malaysia

 

The panel answering questions at the public dialogue on the Penang Transport Master Plan last month (filepic).

New mode of public transport

GEORGE TOWN: The state government will look into Penang Forum’s suggestion of an Autonomous Rail Rapid Transit (ART) system as an alternative to the light rail transit (LRT).

Chief Minister Chow Kon Yeow (pic) said the state government was briefed by China Railway Construction Corporation (CRCC) on the new train system last week.

“ART is relatively new. CRCC presented the system to us with the same slides and video used by Penang Forum.

“It will not be fair for us to respond now as ART is new to us, but we are not ruling it out,” he said after the question-and-answer session of a public dialogue on the Penang Transport Master Plan (PTMP) at Dewan Sri Pinang on Sunday.

“All this while, Penang Forum never mentioned ART. Before this, they spoke of trams,” Chow said, responding to the presentation made by Penang Forum member Dr Lim Mah Hui.

Chow added that in the video, the train was on a highway with eight to 10 lanes.

“Penang does not have that much road space,” he said.

ART is a rail-less system for urban passenger transport, similar to other guided busways.

Later, in a press conference, Chow said ART did not require an actual railway.

“It has rubber wheels running on roads. It is directed by a sensor system, installed along the road and can be dedicated or shared with other modes of transport.

“If it is dedicated, other measures need to be taken into consideration, like when it approaches an intersection, the traffic light must be programmed to give priority to ART.

“If not, then it is no different from a bus,” he said.

Meanwhile, the Rural Industry and Entrepreneurship Organisation declared its support for the PTMP at the dialogue.

Its secretary-general John Ooh Sin Hwa said the transportation problem not only caused a daily inconvenience but had a negative impact on the state’s economic growth.

“We feel that the benefits and advantages outweigh negative implications.

“PTMP is a noble and sincere effort by the state government,” he said, adding that they would carry out a survey in rural areas and present the findings to the government. – The Star by tan sin chow and n. trisha

keen on ART system

PENANG Forum stands by its proposal for an autonomous rail rapid transit (ART) system instead of a tram system.

The group’s steering committee member Dr Lim Mah Hui said they were not ‘tram salesmen’ and that they made the suggestion based on the best mode of transportation implemented in other cities.

“Basically, the Halcrow proposal favours a Bus Rapid Transit (BRT) and tram system.

“And, it is only the suggestion of SRS Consortium that the proposed Penang Transport Master Plan should include an elevated Light Rail Transit (LRT).

“The state said they were not going for the trams because of the cable work needed but the LRT system would require digging and piling which would be more expensive and take a longer time,” said Dr Lim in an interview recently.

He urged the state government not to rush into implementing the LRT as it “might be obsolete in a few years”.

“Penang Forum was only made aware of the ART system a few months ago.

“Who knows what type of advanced public transportation system we might see in a few years?” he said, adding that there was a need for a financial comparison of the LRT, tram, BRT and ART systems.

When asked if Penang Forum would conduct a session to explain the ART system, Lim said he would discuss it with the committee.

He cited an article in The Sydney Morning Herald which called for an ART system to be implemented in Perth.

He said the article also claimed that trackless trams would be able to avoid the worst features ofan light rail system in terms ofdisruption and costs.

The first trackless tram rolled out for a road test was in Zhuzhou, south China’s Hunan Province, on Oct 23, 2017.

Last month, Chief Minister Chow Kon Yeow said the state would look into the suggestion to implement the ART system when the matter was raised during a question- and-answer session of a public dialogue on the Penang Transport Master Plan at Dewan Sri Pinang.

Chow said the state government was briefed by China Railway Construction Corporation on the new train system.

“The ART has rubber wheels running on roads.

“It is directed by a sensor system installed along the road and it can be dedicated or shared with other modes of transport,” he said. – The Star by Intan amalina mohd ali

 

Related:

 

Penang mulls China-designed railless train to ease traffic woes | The …

 

No rail, just road: Group wants Penang to consider new tram system …


 

Penang Forum now proposes the ART system… – Chow Kon Yeow 曹觀友 …

 

Related posts:

 

Penang Forum calls to review Penang mega projects

 

Tariffs won’t make US firms produce in US


“It would not be profitable to build the Focus Active in the U.S. given an expected annual sales volume of fewer than 50,000 units,” automaker Ford Motor Company said in a statement on Sunday.

US President Donald Trump tweeted earlier on Sunday that “‘Ford has abruptly killed a plan to sell a Chinese-made small vehicle in the US because of the prospect of higher US Tariffs.’ CNBC. This is just the beginning. This car can now be built in the USA and Ford will pay no tariffs!” Ford quickly clarified the facts, evidently rebuffing Trump’s tweet.

Likewise, tech giant Apple Inc. wrote a letter to US Trade Representative Robert Lighthizer, saying that a proposed 25 percent tariff on $200 billion of Chinese imports would cover a “wide range of Apple products.”

In another tweet, Trump told Apple to make their products in the US instead of China. Apple hasn’t responded.

According to the US media, the price of iPhone may increase to $2,000 if the company does as told.

The multinational companies that produce automobile and mobile phones have different manufacturing and sales layouts. Car manufacturers tend to produce their products where they are sold, while mobile phone manufacturers optimize their production chain costs worldwide. That’s the natural law of economic globalization which can’t be easily changed by a country’s government.

The White House lacks understanding of the global production and value chains. “Make your products in the United States instead of China” seems naive. Instead of coercing companies to follow demands, imposing tariffs will only scare them off.

Simply making US companies produce in the US can’t deal with the complicated global industry today. We have also learnt from history that neither side will gain in a trade war.

China is the world’s largest automobile and mobile phone market. Setting tariff barriers between Beijing and Washington won’t make US companies give up on China for the sake of their own country. As long as China doesn’t make things hard for US companies, it’s unavoidable that they will place production operations in China. The Chinese market can help them make money, but the White House can’t.

Most American high-tech companies will face difficulties if they leave China. The larger the market is, the higher return the companies will get from their research and development. High-tech companies, if they can’t grow to be giant, don’t usually survive for long, and it would be fatal for many of them to lose the Chinese market.

There hasn’t been a previous US government that dares to instruct multinational companies in production layouts, and the current administration has overestimated its executive power. The global industrial chain today is formed by market rules established over decades and can’t be easily changed by one government.

It would be the White House’s dream to expect that the US is not only the world’s technology and financial center, but also the world’s factory that sells its products globally. If the US doesn’t want to wake up from this dream, then the outside world has to step in and rouse Washington.

Source:Global Times

Related:

 

Trade data shows US economy rejects trade war

The decline in trade will affect both China and the US. It is not only China that will bear the consequences.

 

China cool to Australia’s contradictory policy

China should give up the illusion of persuading Australia to stop containing China together with the US. Instead Beijing should let Canberra calm down and rethink.

 

China-Africa cooperation charts a new path of mutual benefits

The Chinese people must cherish what the country has earned them. China has no alternative but to continue to learn how to deal with the world in the 21st century.

 

Xi’s China-Africa guidelines are the keys to the new global paradigm

The “five-no” and “four-can’t” are truly inspiring. They correct the concepts of rights and point to the justice of the day. President Xi’s points will definitely leave a deep mark on the history of relations between the African continent and China, and the entire world.

 

West’s sour grapes at China-Africa cooperation

The possibility of the West leading the collaboration with the continent again always exists as long as they do not get their heads jammed by a geopolitical mind-set.

 

China-N.Korea friendship benefits whole region

The US, South Korea and Japan must clarify what exactly they want on the Korean  Peninsula. They cannot have everything, especially things that contradict each other. If the US wishes for denuclearization and peace on the peninsula, it would see the value of China-North Korea ties and support them.

Rocky times ahead for China FDI in Malaysia


Li: ‘Malaysia must remember that by targeting Chinese investors in an unreasonable way, this will scare away not only FDI from China, but also from other countries.’ – credit: Malaysia Today

Great wall of controversy: Dr Mahathir’s criticism of Alliance Steel’s barricade for its RM6bil integrated steel
complex has upset some Chinese investors.

A series of attacks on China-funded projects in Malaysia by the Prime Minister is causing anxiety not only to Chinese nationals but also locals.

INVESTMENTS and mega contracts linked to China will have to brace for rocky times ahead if Prime Minister Tun Dr Mahathir Mohamad continues unchecked with his incessant tirade against Chinese endeavours in Malaysia.

The golden era for Chinese investments, which possibly peaked during the rule of former prime minister Datuk Seri Najib Razak, seems to have come to an unceremonious end.

The future of foreign direct investment (FDI) from China is now seen as unpredictable – at least for the next 3-5 years – under the new government of Dr Mahathir, according to Datuk Keith Li, president of China Entrepreneurs Association in Malaysia.

Li: ‘Malaysia must remember that by targeting Chinese investors in an unreasonable way, this will scare away not only FDI from China, but also from other countries.

“The series of comments made on Chinese investments by the PM have affected the confidence of Chinese investors. Those who originally wanted to come are adopting a wait-and-see attitude, while those already in are careful about their expansion plans,” says Li in an interview with Sunday Star.

The outspoken leader of Chinese firms notes that businessmen from the mainland are “worried”, although some comments of the Prime Minister were later “clarified” by other Cabinet Ministers or the PM’s Office.

“Malaysia must remember that by targeting Chinese investors in an unreasonable way, this will scare away not only FDI from China, but also from other countries as well,” adds Li.

Since his five-day official visit to China that ended on Aug 21, the 93-year-old Malaysian leader has caused anxiety to all by making shocking announcements.

While summing up his China trip on Aug 21, he declared he would cancel the RM55bil East Coast Rail Link (ECRL) and two gas pipelines being built by Chinese firms.

As the ECRL is of strategic importance to China’s Belt and Road Initiative – the policy which Dr Mahathir has repeatedly voiced his support for, Beijing would expect a renegotiation of the contract terms rather than an outright cancellation.

Dr Mahathir had reasoned that with national debt of over RM1 trillion, Malaysia could not afford these projects. In addition, these contracts are tainted with unfair terms and smacked of high corruption.
Although the Prime Minister said Chinese leaders understood Malaysia’s situation, reactions of Chinese nationals on social media were unforgiving with many suspecting Dr Mahathir “has other motives”.

Many see Dr Mahathir as attempting to raise Malaysia’s bargaining power in the negotiation for compensation for the cancelled projects. China, according to social media talk, is asking for RMB50bil as compensation.

On social media, there are also suggestions that Dr Mahathir is aiming at his predecessor as most China-linked projects were launched during the rule of Najib.

During the rule of Najib, Malaysia-China relations were intimate.

This has resulted in the influx of major construction and property companies from the mainland, followed by banks and industries.

But on May 9, Dr Mahathir’s Pakatan Harapan coalition toppled the Barisan Nasional government of Najib after the most bitterly fought general election in local history.

The second-time premier has put the blame on Najib for the massive 1MDB financial scandal, which Najib has denied, and mismanagement of the country’s finance.

And while the Chinese nationals are all riled up by the cancellation of ECRL, Dr Mahathir came up with an ill-advised statement.

Last week he ordered a wall surrounding Alliance Steel, which is investing US$1.4bil (RM6bil) for a massive steel complex, to be demolished. This was seen as unreasonably targeting a genuine FDI.

Although the foreign ministry later clarified that the leader had mistaken the wall to be built around the Malaysia-China Kuantan Industrial Park (MCKIP), the anger of Chinese nationals lingers on.

The industrial park is a G-to-G project to jointly promote bilateral investments. There is an even bigger sister industrial park in China that houses many Malaysian firms. All these were built during Najib’s reign.

Dr Mahathir’s statement has also caught the attention of China’s Global Times, the mouthpiece of the Communist Party of China.

In an editorial on Aug 28, the news portal warned: “Many words of Kuala Lumpur can spread to China via the Internet, causing different reactions. How the Chinese public sees China-Malaysia cooperation is by no means inconsequential to Malaysia’s interests.”

It noted “while Dr Mahathir advocates pursuing a policy of expanding friendly cooperation with China … but when it comes to specific China-funded projects, his remarks gave rise to confusion. Like this time, it is startling to equate the controversy surrounding a factory wall with state sovereignty.”

Global Times added: “When such remarks are heard by Chinese people, the latter find it piercing. They will definitely make Chinese investors worry about Malaysian public opinion and whether such an atmosphere will affect investment in the country.”

In fact, it would be unwise for the government to disrupt MCKIP. Co-owned by Chinese, IJM Corporation and Pahang government, this industrial park has lured in Chinese FDI of over RM20bil.

It is an important economic driver in the East Coast and has aimed to create 19,000 jobs by 2020.

While the “wall” statement might be seen as a minor mistake, Dr Mahathir’s flawed announcement last Monday that foreigners would be barred from buying residential units in the US$100bil (RM410bil) Forest City stirred another uproar.

On Aug 27, Reuters quoted Dr Mahathir as saying: “That city that is going to be built cannot be sold to foreigners. Our objection is because it was built for foreigners, not built for Malaysians. Most Malaysians are unable to buy those flats.”

Currently being developed by Country Garden Holdings of China, this 20-year long project, built on reclaimed land in Johor Bahru, aims to house 700,000 people. As about 70% of the house buyers are Chinese, some locals fear this could turn into a China town.

Unlike Alliance Steel that has stayed silent, Country Garden fought back by seeking clarifications from the PM’s Office.

In a statement, the major Chinese developer said all its property transactions had complied with Malaysian laws.

Citing Section 433B of the National Land Code, it added a foreign citizen or a foreign company may acquire land in Malaysia subject to the prior approval of the State Authority.

In addition, it said Dr Mahathir’s comment did not correspond with the content of the meeting he had with Country Garden founder and chairman Yeung Kwok Keung on Aug 16.

During the meeting, Dr Mahathir said he welcomed foreign investments which could create job opportunities, promote technology transfer and innovations.

In fact, this forest city project – along with ECRL – were the main targets of attack by Dr Mahathir before the May 9 election.

Opposition to these projects had helped drive Dr Mahathir’s election campaign, during which he said was evidence of Najib selling Malaysia’s sovereignty to China.

These projects, together with major construction contracts won by Chinese and the inflow of industrial investments, place the total value of Chinese deals at more than RM600bil in Malaysia.

But few would expect Dr Mahathir to use his powerful position to resume his attacks on China-linked projects so soon after his so-called “fruitful visit” to Beijing.

During his official visit to Beijing, the Malaysian leader was accorded the highest honour by China, due mainly to respect for “China’s old friend” and strong Malaysia-China relations built since 1975.

Dr Mahathir was chauffeured in Hongqi L5 limousine, reserved for the most honourable leaders, and greeted in an official welcome ceremony by Premier Li Keqiang. He was also guest of honour at a banquet at Diaoyutai State Guesthouse hosted by President Xi Jinping.

But beneath these glamorous receptions, there were reservations exuded by the Chinese for this leader whose premiership is scheduled to end in two years.

There were no exciting business deals signed in Beijing. There was absence of high diplomatic rhetoric that “Malaysia-China ties have been elevated to another historic high”, oft-repeated during Najib’s past visits.

Many even notice that Premier Li and Dr Mahathir had a cool handshake after their short joint press conference in Beijing.

And although China promised to buy Malaysian palm oil, the statement was qualified with “price sensitivity”, which means it will not buy above market price.

In addition, there was no mention of “buying palm oil without upper limit”, which was promised to Najib last year.

If Dr Mahathir’s original intention was to target Forest City and its owners, his move has certainly backfired. The country will have to pay a price for his off-the-cuff statement.

The “new policy” will have serious ramifications as it would hit the value of the properties not only in Forest City but also in other China-linked and non-Chinese projects.

Country Garden’s Danga Bay project will also be hit. It now faces a more daunting task of selling the balance of about 2,000 units in Danga Bay, according to a Starbiz report.

Other Chinese developers like R&F Princess Cove and Greenland Group will be affected.

VPC Alliance Malaysia managing director James Wong told Starbiz there may be legal suits against the government.

“That may force Country Garden to scale down because it has invested a lot with its industrial building systems factory and an international school, among other investments. It will impact Country Garden and Malaysia’s property sector negatively,” Wong said.

“Foreign buyers and other foreign companies will shy away,” Wong added.

The change in government and the insensitive comments on China-funded projects have turned Malaysia into a high-risk investment destination for the Chinese, according to Li.

“We don’t know which China projects will be targeted next. Looking back, it’s a blessing in disguise that we were pushed out of the RM200bil Bandar Malaysia project. It is also lucky that Chinese money has not gone into the RM30bil Melaka Gateway project,” says Li, who owns a travel agency in Malaysia.

“In the immediate future, more tourists from China are likely to shy away from Malaysia.

“Malaysia may not hit the target of having three million visits from China this year,” Li adds.

Credit: Ho Wah Foon The Star

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ECRL and pipeline projects cancelled !


It added to the country’s debts and we cannot afford it, explains Dr. Mahathier

Headline News

THE cancellation of two multi-billion dollar projects in Malaysia awarded to companies from China ends months of uncertainty, besides marking new parameters for investment by companies from the world’s second largest economy.

Tun Dr Mahathir Mohamad announced the cancellation of the RM55bil East Coast Rail Link (ECRL) and two gas pipeline projects worth RM9.41bil at the end of his five-day visit to China.

The Prime Minister said the projects only added to Malaysia’s debts and had to be cancelled until the country could afford it.

He said China’s leaders understood Malaysia’s plight and their response was positive.

He said he explained to President Xi Jinping, Premier Li Keqiang and chairman of the National People’s Congress Li Zhanshu why Malaysia could not go on with the projects.

“It is all about borrowing too much money, we cannot afford it, we cannot repay and also because we do not need them.

“The Chinese see our point of view and none of the three leaders said ‘no’.

“They understand why we have to reduce our debts,” Dr Mahathir told Malaysian journalists here yesterday before wrapping up his official visit.

Asked about compensation, he said details including the amount would have to be negotiated and worked out by officials later.

“If we have to pay compensation, we have to pay. We cannot afford it, so we must find a way to exit it at the lowest cost possible,” he added, blaming the previous government for entering into such unfair agreements with huge exit costs.

Both projects were awarded under the previous government in November 2016 during an official visit to China by former prime minister Datuk Seri Najib Tun Razak. Since Pakatan Harapan took over, China’s investments in Malaysia and large-scale infrastructure projects have come under intense scrutiny.

Both the railway and gas pipeline projects were mired in controversy with huge advance payments made not corresponding with ground work.

Dr Mahathir also laid out the types of investments that Malaysia wanted to attract, citing foreign direct investments (FDIs) which brought in capital and technology, and hiring of locals to produce goods for local consumption or export.

“This is the meaning of FDI, not buying land and setting up new cities. We want our people to be employed and they (China) agreed,” he added.

Criticism on previous construction projects undertaken by companies from China was that it had little multiplier effects on domestic economy because almost everything was brought in from there.

As per the ECRL project, most of the railway track work was slated to be handled by companies from China despite Malaysia having many companies with such expertise. And as for the two pipeline projects, an average of only 13% of the work was done but the amount drawn down was a staggering 88% of the total cost of RM9.4bil.

No local company was known to be undertaking the gas pipeline jobs.

Dr Mahathir in the past also criticised land and reclamation rights being sold to property developers from China to build large-scale property projects, especially in Johor.

Asked what happened to the money that had been drawn down, he said it should be recovered from Najib.

“He was the one who entered (into the agreement), I have never heard of a contract in which you pay on time without any condition that the work must be done,” he added.

Economists said investors had been waiting for some kind of direction on China’s investments here with Pakatan in power.

Socio Economic Research Centre executive director Lee Heng Guie said the impact of the cancellation of the projects to the Malaysian economy would be manageable, although there would be some negative effect on consumption and investment.

“There could be some impact on the job market with the expected layoffs.

“But I don’t think the cancellation will pull down investment and consumption significantly.

“Whatever contraction of the economy that we will likely see because of the ECRL cancellation should be cushioned by ongoing projects,” Lee added.

Credit: Beh Yuen Hui in Beijing

Cancellation of ECRL comes as a shock to workers

 

All quiet: Workers at the ECRL site in Bentong, Pahang, are waiting for an announcement from their management after Dr Mahathir cancelled the project .

BENTONG: While some workers involved in the East Coast Rail Link (ECRL) are in shock over the scrapping of the project as announced by the Prime Minister, some areas have yet to see any work despite the launch of the 688km line about a year ago.

Several construction workers said they were left in the dark over the matter.

“Right now, we don’t know what the actual status of the project is.

“We are still waiting for an announcement from the top management,” a senior construction worker told The Star on condition of anonymity.

Another construction worker also expressed a similar sentiment, saying that the ECRL project consisted mainly of Malaysian workers.

“Workers from China comprised 18% to 20% of the staff,” he said.

A security guard at the Bentong ECRL project site said the workers’ quarters were already deserted a month ago.

In July, Singapore’s Channel NewsAsia reported that the fallout had already seen half of the workforce, mostly Malaysians, being retrenched.

A source from the Malaysian Rail Link (MRL), the project owner of ECRL, confirmed that the retrenchment did indeed take place.

“The China Communications and Constructions Company (CCCC) started layoffs a month ago when the project was suspended.

“Half of them are already retrenched and the Chinese workers were told to leave,” said the highly placed source.

Top officials in the MRL are said to be shocked by Tun Dr Mahathir Mohamad’s announcement as it was understood that they were in discussion with the Council of Eminent Persons (CEP) and the Transport and Finance Ministries to come up with several options to scale down construction costs.

“The MRL has paid more than RM10bil to the main contractor, the China Communications and Con­struc­tions Company and there is a claim of RM9bil for work done.

“So it will be quite a waste because the figure to compensate them is quite high,” he said.

The project was launched on Aug 9, 2017, and scheduled for completion in 2024.

In Kuantan, at the site in KotaSAS where the project was launched with much fanfare, all that remains is an empty swathe of land.

Besides the ongoing construction to build the new Pahang administrative centre nearby, it was all quiet at the site where former prime minister Datuk Seri Najib Tun Razak performed the ground-breaking ceremony.

A security guard at the site said no actual rail construction had been carried out since the launch.

The guard, who declined to be named, said there were no workers from China or an ECRL office located at the site.

He was surprised when told of Dr Mahathir’s announcement.

“But then again, there was never any railway construction here. So, there’s nothing to stop,” he said.

A large signboard near the site stated that the KotaSAS Central station would open in 2021.

Credit: Tarrence Tan, Ong Han Sean, Mahadhir Monihiuldin The Star


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