Snubbing China closes trade doors further, says Pakatan

By Shannon Teoh, The Malaysian Insider

KUALA LUMPUR, Oct 6 — The federal opposition has warned that Putrajaya’s shifting position in proposed deals with China-based firms has further dented Malaysia’s chances of spurring trade.

Pakatan Rakyat (PR) lawmakers noted that with economic giants Europe and the United States facing prolonged debt crises, Malaysia is sending the wrong signal to its fourth-largest trade partner.

“We can’t afford to anger foreign investors, much less Chinese investors who we are aggressively wooing,” said DAP publicity chief Tony Pua.

The Malaysian Insider reported yesterday that the Finance Ministry dropped mainland Chinese developer Everbright’s US$1 billion (RM3.2 billion) redevelopment plan for Pudu Jail in favour of splitting the eight-hectare prime land into three parcels to be developed by mainly Bumiputera companies.

It also reported yesterday that Putrajaya has decided to forgo a cheap RM2.6 billion loan from China to build the Second Penang Bridge, and has instead asked state-owned Bank Pembangunan to further underwrite the construction of the 24km bridge which is now due in 2013.

The loan, which was seen as a sign of closer ties between Malaysia and its largest export market, was set with an interest loan of three per cent for 20 years, understood to be marginally lower than the Bank Pembangunan rate.

PAS research chief Dzulkefly Ahmad (picture) said “this raises questions about the kind of signal we are sending to what is probably the most important economy in the world while Europe and America struggle with double-dip recessions.”

PKR secretary-general Saifuddin Nasution said these moves continue a trend of delays and flip-flops in business relations with China that “lowers confidence that Malaysia knows how to plan and stick to agreements.”