Published: Fri, July 06, 2018

Malaysia investigates China-backed project links with 1MDB

Malaysia investigates China-backed project links with 1MDB

The premier's visit will likely be preceded by a trip to China this month by 80-year-old former finance minister Daim Zainuddin, two sources and local media reports said.

In his interview with Al Jazeera, Dr Mahathir also expressed disappointment that Saudi Arabia did not comment on Najib's claim that the RM2.6 billion deposited in his account was a "donation" from one of the kingdom's royalty.

EximBank and CPPB did not immediately respond to Reuters request for comment.

However, Najib also sacked Tan Sri Gani Patail as attorney-general at the time, replacing him with Tan Sri Apandi Ali who then cleared the former PM of any wrongdoing.

Completing Malaysia's biggest rail project as previously planned would cost $20 billion, Lim said on Tuesday, almost 50 percent higher than estimates under the previous government.

Mahathir has been vocal about concerns that projects with China could leave Malaysia in serious debt. Since taking office, he has vowed to renegotiate terms even as construction work continued.

Work on the $20 billion East Coast Railway Link (ECRL), which would connect parts of Malaysia, was suspended on June 4. Twenty-three stations were planned, starting at Port Klang on the west coast of peninsular Malaysia, near Kuala Lumpur, and ending at Kelantan in the northeast, near the Thai border.

Chinese state-owned firms are involved in all three projects.

"The decisions are exclusively directed toward the related contractors, relating to the provisions mentioned in the agreements, and not at any particular country", the finance ministry said in a statement on Thursday.

Najib, a top supporter of China's Belt and Road initiative of investments in the region, called the rail project a "game changer" during its August 2017 groundbreaking.

"It's sending a message to the Chinese", said one of the sources, a senior finance ministry official.

In May, Mahathir postponed plans to build a high-speed rail link between Singapore and Malaysia, which had been agreed on several years ago, saying it was too costly.

Organized before his election victory, Mahathir's first overseas visit as prime minister, to Japan last month, was nonetheless seen as a signal he would look beyond China for key foreign investment.

"One of our promises was that we would honour the separation of powers between the legislative, executive and judiciary, so I can not interfere with that the Attorney-General wants to do".

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