China’s biggest builders are sure that Xi Jinping can help them get Malaysia contracts back on track

China Communications Construction, the contractor of Malaysia’s largest public works project, said it is confident of getting the Chinese government’s support to get its cancelled contract back on track through President Xi Jinping’s negotiations with the administration of Malaysian premier Mahathir Mohamad.

“Since the project involves both nations’ economic and trading interests, we believe China and Malaysia will resolve the issue in a friendly manner,” the state-owned contractor’s overseas executive vice-president Li Qingwei said during a results press conference in Hong Kong. “We believe the Malaysian parties – companies and government – will negotiate, taking Malaysia’s economic development needs and its citizens’ livelihood improvement prospect into consideration.”

The US$15 billion East Coast Rail Link project (ECRL) was supposed to connect Peninsular Malaysia’s rural east coast to Port Klang in Selangor state on the coast of the Strait of Malacca through 688 kilometres of high-speed railway.

Nine months after breaking ground, the project – the most expensive infrastructure project ever undertaken in Malaysia – was stillborn when Mahathir won a landslide election and ousted the ECRL’s strongest proponent, Najib Razak, from government. Balking at the construction cost, Mahathir shelved the ECRL, two oil pipelines in Sabah state and a high-speed rail link between Kuala Lumpur and Singapore. The 93-year-old prime minister also spoke of banning foreign buyers from investing in Country Garden Holdings’ Forest City township near Malaysia’s border with Singapore.

The ECRL’s total cost was “inflated” to hide a scheme to channel funds toward paying for debt owned by 1Malaysia Development Berhad (1MDB), according to a June 4 interview by The Edge Malaysia citing an interview with Mahathir. The state investment agency, Najib’s brainchild, is embroiled in the former premier’s corruption and money laundering case, scheduled for trial next February.