The new Malaysian government under Prime Minister Mahathir Mohamad sent out alarm signals due to the country’s abyssal debt.This could mean a slowdown, a scale-down or eventually the cancellation of some of the mega infrastructure projects launched by the previous government, including the East Coast Rail Link and the High Speed Train to Singapore.
Newly-appointed Finance Minister Lim Guan Eng confirmed that Malaysia’s debt is above RM1 trillion (US$251 billion), major contributing factors being debts from the Malaysia Development Bhd. (1MDB) as well as mega projects approved by the previous government.
Malaysia official news agency Bernama reported that the newly-established Council of Eminent Persons (mostly experienced Malaysians involved in economic affairs) found that the actual cost of the East Coast Rail Link (ECRL) should not exceed a total investment of RM55 billion (US$13.8 billion). However, according to CEP Chairman Tun Daim Zainuddin, the total real cost of the East Coast Rail Link (ECRL) project would be closer to RM66 billion if not more if interest rates are being taken into consideration.