Malaysia to scrap Kuala Lumpur - Singapore high-speed project
Jun 01 2018
Malaysia will implement a new sales tax in September to replace the consumption levy that it's scrapping next month as Prime Minister Mahathir Mohamad looks for ways to temper concerns on the nation's budget.
"It's not beneficial, it's going to cost us a huge sum of money". Asked if Singapore had been informed of his decision, he said: "I don't know".
The cancellation came as an investigation into corruption tightened around former prime minister Najib Razak, who lost the 9 May general election to 92-year-old Mahathir, himself a previously serving prime minister from 1981 to 2003.
The Facebook page of the powerful Sultan of Johor - Malaysia's southernmost state bordering Singapore - past year published a video of a tiny maritime facility built on Middle Rock.
The move comes after a private fundraising initiative Please Help Malaysia! received more than $US3,500 ($4,640) of donations on website GoGetFunding in a campaign to help the south-east Asian country reduce debt.
Mahathir has said that Malaysia's debt had ballooned to more than one trillion ringgit ($251bn) under Najib, and he would review projects agreed under his predecessor.
While Malaysia is working out how much it is should compensate her neighbour for pulling out, observers say the loss of the rail connection will have far-reaching consequences for Singapore.
"After knowing the full extent of the government's total debts, it is prudent to call off the HSR and other mega projects", he said.
The 1MDB fund accumulated billions in debts and is being investigated in the United States and several other countries.
Mohamad said that the process to cancel the project will take some time because of Malaysia's agreement with Singapore. "We'll make no money at all from this arrangement", he added.
"So we can not (be able) to pay so much money if we continue with the project".
"In reality, infrastructure projects such as the HSR bring returns and benefits in the form of property value growth, local economic stimulus, technology transfer, high-income job opportunities, the entry of talent from Singapore and tourism". Minister of Finance, Lim Guan Eng ends the statement by expressing their honest appreciation and gratitude to all Malaysians for all their support and concern.
The planned double-track link between the Malaysian capital city of Kuala Lumpur and Singapore was set to connect the two in 90 minutes with seven stations in Malaysia and one in Singapore.