Hong Kong’s MTR Corp plans joint bid with mainland rail giant to build Kuala Lumpur-Singapore link

Project would be corporation’s first attempt to capitalise on mainland government’s ‘Belt and Road’ trade strategy

PUBLISHED : Monday, 15 May, 2017, 2:15pm
UPDATED : Monday, 15 May, 2017, 11:26pm

Hong Kong’s rail operator plans to join forces with a state-owned mainland Chinese rail giant to bid to build a multibillion-dollar rail line between Malaysia and Singapore, in its first attempt to capitalise on China’s global trade and commerce strategy, a top official said.

MTR Corporation chairman Frederick Ma Si-hang told the Post exclusively that the company was interested in partnering with China Railway Corporation to bid for a contract to build a 350km high-speed rail link between Kuala Lumpur and Singapore.

If it materialises, the project would be MTR Corp’s first investment under China’s “Belt and Road” plan.

“We want to expand into new markets under the ‘Belt and Road’ initiative,” Ma said. “But we are careful in considering factors such as financial viability of projects and risks.”

Ma is part of a 30-strong delegation from Hong Kong led by Chief Executive Leung Chun-ying at the Belt and Road Forum for International Cooperation, in Beijing.

Chinese President Xi Jinping rolled out the red carpet for 1,200 delegates from more than 100 countries or territories on Sunday and Monday.

Ma learned from Malaysia’s transport minister Liow Tiong Lai at the forum on Sunday that tender for the rail project was due at the end of this year, with completion expected in 2026.

Ma said MTR Corp and China Railway Corp signed a memorandum of understanding for cooperation in the initiative last December, paving the way for future partnership in more than 60 countries along the plan’s two trade corridors: the old Silk Road land route to the north, and the maritime Silk Road to the south.

Ma said the rail company was inclined to take a managerial role in any future projects, which are mostly capital intensive.

“We have gone global earlier than other companies and gained some overseas experience, largely in developed countries,” he said. “When talking about investments, we have a stringent set of internal requirements on risks and returns, which are not easily met.”

Take a tour of the five biggest ‘Belt and Road’ projects

Ma said there were many highly populated markets along the corridors, which promised sufficient demand for mass transit.

But risks relating to politics, financing and corruption had to be mitigated, he said.

“The financing issue can be resolved through AIIB,” Ma said, referring to the Asian Infrastructure Investment Bank, the Beijing-backed global bank, started in 2015.

As well as Hong Kong, MTR Corp’s reach includes Beijing, London, Australia and Sweden, mostly in managing rail lines.

The corporation also set up an academy last year to train engineers not only for Hong Kong but in Indonesia, Thailand, Malaysia and Macau.

Denise Tsang is reporting from Beijing.