Mahathir's shock Malaysian election victory puts China Belt & Road investments in spotlight

Kuala Lingga International Port Kuala Lingga International Port

The shock victory by the Malaysian opposition Pakatan Harapan in the country’s General Election on Wednesday have put a question mark over Belt and Road Initiative projects with China in the Southeast Asian nation.

Maverick Prime Minister Mahathir Mohamad returns to the role at the age of 92, after an absence of 15 years, defeated his successor and former protégé Najib Razak, who had been mired in corruption allegations.

Mahathir says that the economy and finance will be the new government’s main focus. Questions were quickly raised about controversial Chinese investments in the country, which include both massive property projects, as well as BRI infrastructure investments.

Speaking at a press conference on Thursday Mahathir said that previous investments projects by China in Malaysia would be reviewed by the new government, but that this would be the case across the board. “We need to study all the things done by the previous government. It is not only about China, it’s about a lot of things within the country,” he said.

Belt & Road Initiative investments in Malaysia

Commenting specifically on BRI related investments, Mahathir said: “As far as the Belt and Road problem is concerned, we have no problem with that, except of course, we would not like to see too many warships in this area, because warships attract other warships, and this place may become tense because of the presence of warships.”

The incoming PM noted that China had shown it was skilled at getting the better end of such agreements.

Included in planned Chinese investments in Malaysia is a massive 30m teu capacity container port on Carey Island close to the country’s existing largest container port in Port Klang. The scale of the project has raised eyebrows among industry observers and analysts.

Read More: Malaysia’s Carey Island a wild card in Southeast Asian port scene

Malacca oil storage project to break ground Q1, 2017

Another project with Chinese investors behind it is Kuala Linggi International Port, which aims to capture a slice of the oil transhipment and storage market, as well as ship repair, from Singapore 200 km away.

An overland Silk Route

Mahathir, however, focused on the possibility of a major overland rail link with China saying he had written a personal letter Chinese President Xi Jinping suggesting an overland Silk Route.

“As you know, when the demand for oil grew, ships were built bigger and bigger until they were almost half a million tonne, but trains have remained small, and not long enough.

“So I suggested to Xi Jinping in a personal letter to him, that we should have big trains, and China has the technology to build big trains, which can carry goods from China to Europe, and will also make Central Asia-Kazakhstan and Uzbekistan, and all that, more accessible,” he said.

At the same time Mahathir expressed concern over the heavy burden placed on the country by investments such as the $13bn East Coast Rail Link project being built by China Communications Construction Co.

Posted 11 May 2018

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Marcus Hand

Editor, Seatrade Maritime News

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