TTF: Following is a point-for-point reply (in bold, blue) by Dato’ Eric See-To to questions posed and conclusions made in an article that appeared in Malaysiakini, which you can trace by clicking here
Do you know the East Coast Rail Link (ECRL) cost at RM55 billion is way over inflated. Do you know we are given 7 years grace period after completion ? Do you know the reported interest rate is at 3%?
Do you know the repayment period is 240 months ? Do you know the total repayment will be about RM99.6 billion?
3% is just about our inflation rate. In real terms, it is zero percent rate. So, we essentially get free use of the money for 20 years when we have to make total repayment
Do you know a single unsubsidised ticket from KL to KB on ECRL will cost RM3,586 if we use the eastern corridor passenger load ? Do you know that this is equivalent to return economy class ticket to Siberia, Russia. Do you know this is all about DEBT and nothing about FDIs ? Do you know this is the start of China Debt Trap program in Malaysia.
More than 70% of ECRL’s traffic would be freight – not passengers. This is why it is built to connect the ports on East Coast with Port Klang.
Also, the returns of a major transportation project is not based on just the revenue of a rail-link. The govt is doing transport-oriented development – meaning the land value of the entire stretch would increase and allow manufacturing zones and tourism activities would spring up in those areas. On top of the land value increase, the govt will also reap tax revenue (yes, including GST) from the increased jobs and economic activity. A rail project will last for 100 years and the returns to the govt and the people will be long-term – long after you are gone.
Do you know overall contribution of ECRL post completion is about 1% of Malaysian GDP as was announced by Najib ?
It is 1% per year. Our GDP right now is RM1.22 trillion – hence 1% is RM12.2 billion each and every year. Over 20 years, this is RM244 billion whereas over 100 years, this is RM1.22 trillion. Both these numbers are way above the RM55 billion. Please do the maths
Do you know that all these expenses are not a priority now given our ballooning national debt, both on budget and off budget exceeding RM1.2 trillion? We are missing debt or contingent liabilities repayment already !
Our national debt – even including contingency debts is not RM1.2 trillion. It is RM650 billion plus RM170 billion contingency. Our national debt is just 52.7% of our GDP – way lower than the vast majority of the countries in the world.
Contingency debts are not included in calculations of national debt as 1) it is contingent and; 2) it is normally just a guarantee on bonds that is backed by assets*
And since when are we missing any national debt repayments? If yes, the credit rating agencies would have downgraded us to junk. Instead all 3 major agencies say we are a A-rated investment grade country
Please think and reflect carefully. I love this country as much as you do. My tears rolls freely when we are taken for a ride by China. Just read what happened with similar infrastructure projects by China in Pakistan, Sri Lanka many South American and African countries and how it ended. Read, think and reflect carefully. We can make small mistakes but cannot afford to make big mistakes. That’s all. This is not about politics. It is about sovereignty of our land. Our Malaysia.
I cry for you as you have such a shallow understanding of economics and so easily influenced by propaganda. Even the Singaporeans are afraid of this ECRL as it has a serious potential to take over their cake