In today's #dailysoup, let's return to #Malaysia as I'll introduce a Belt and Road Initiative (BRI) project called the East Coast Rail Link (ECRL).
It is known for its role in the 1MDB scandal, as well as having a sanctioned Chinese firm, CCCC, as one of its developers.
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The ECRL is supposed to be an ambitious and modernised railway project connecting the western coast of the Malayan Peninsula with its eastern coast, starting from Port Klang and ending with the town of Tumpat, which is near Malaysia's border with Thailand.
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Proposals for a railway link between the west and east coasts of the Malayan Peninsula are rooted all the way back to the early 1980s.
In the 2000s, Kuala Lumpur came up with the same proposal again, aiming to stimulate the Malaysian economy.
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A certain former Malaysian senior official stated that India, Japan, and a few other countries were interested to bid for the ECRL.
The pro-China premiersip of Najib Razak found China's bid as the "most attractive", with a pretty weird reason.
4/15
The ECRL ended up being like any other shady BRI project.
In an attempt to cover up the 1MDB scandal, now-convicted Malaysian PM Najib Razak accepted China's offer for Malaysia to join the BRI, with the ECRL as one of the offered projects.
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In 2016, Najib made a secret deal with the China Communications Construction Company (CCCC), a WB-banned Chinese firm, to "inflate the price of the ECRL project from RM30B to RM60B, borrowed from the CCP as a part of the BRI.
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Moreover, the plan of the Najib-CCCC secret deal is to do a "Thanos snap strategy", in which one half of the RM60B would be used for the ECRL project and the other half of the RM60B would be used for "1MDB funds", hoping to "pay the debts" and "cover up the whole thing".
7/15
Although Najib denied any connections with the CCCC, the Najib-CCCC "Thanos snap strategy" happened, with insider evidence from the Sarawak Report stating that RM27B went to the ECRL project while RM29.85B went to fund 1MDB and its "debt payments".
8/15
Furthermore, the Najib-CCCC secret deal for the ECRL project involved other provisions, including Malaysia's membership in the BRI, allowing CCCC to choose supply contractors and partners, in which Chinese workers would do the ECRL by themselves. What's worse is...
9/15
...that a piece of land in Penang worth $1.3B would be sold from Najib to CCCC at $850M.
Coz Penang is located beside the Strait of Malacca, which is a crucial east-west global trade route, Najib's move to sell a piece of Penang land to the CCCC could be very dangerous.
10/15
In addition, the CCCC would be "exempted from paying taxes to Kuala Lumpur".
The Exim Bank would provide loans to ECRL, thus defeating the purpose of "Najib trying to pay off the 1MDB debts" coz of the debts incurred from the BRI loans.
Things are getting weirder.
11/15
Najib and Jho Low used the same bank financing the ECRL to launder funds to an Emirati oil company named IPIC via a state-owned Chinese bank, the Industrial and Commercial Bank of China, and a Kuwaiti dude.
I'll write more about Jho Low in a future entry this month.
12/15
After the fall of Najib in 2018, the Pakatan Harapan premiership of Mahathir Mohamad, fearing that Malaysian BRI projects activated under Najib as a means "to cover up 1MDB" would lead to a Hambantota moment for Malaysia, decided to suspend BRI projects like the ECRL...
13/15
...coz of "high construction costs".
However, after secret negotiations with ECRL's contractors, including CCCC, Mahathir decided to resume the ECRL project in 2019 (citing reasons related to "possible benefits to the Malaysian economy"), but in a watered-down scale.
14/15
Although the CCCC remains sanctioned by the US since 2020, the premiership of Anwar Ibrahim said that the ECRL will resume "without any changes".
The project is still ongoing, with the completion date set to 2027, while China continues its illegal claims on the SCS/WPS.
15/15
Related entries:
Entry #35 (Najib Razak) -
Entry #19 (Melaka Gateway) - https://t.co/bG0NYiZksK
Entry #55 (Belt and Road Initiative) - https://t.co/wTjFYUHdcq
For other entries, kindly visit this link: https://t.co/eTQ9EABZZX
bit.ly/thedailysoup
APPENDIX: Reports from the Malaysian Ministry of Finance indicated that in August 15, 2017, a Cayman Islands-based offshore called "Silk Road Southeast Asia Real Estate, Ltd.", which is a subsidiary of Silk Road Finance Corporation, a Chinese firm serving BRI needs,...
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...initiated the actual buying of the piece of land in Penang despite the Najib-CCCC secret deal stating that "CCCC would be the one to buy that Penang land from Najib", possibly in an attempt to evade accountability.
Things just got weirder.
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ANOTHER APPENDIX: "Silk Road Southeast Asia Real Estate, Ltd." is owned by Sheikh Sabah, the son of a Kuwaiti PM. Sheikh Sabah is funded by CCCC.
Looks like CCCC is trying to evade accountability during its purchase of that piece of land in Penang.
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