Put money from Samurai bond to good use, suspend ECRL, says Jomo

(FMT) – Prominent economist KS Jomo today urged Putrajaya to put the money from its Samurai bond loan to good use, suggesting that the billion-ringgit East Coast Rail Link (ECRL) project be suspended.

“Borrowing from Japan may be the best choice now, but what are we borrowing for? This brings us to the question of the ECRL,” he said during a forum on shared prosperity here.

Jomo, who was part of the high-level Council of Eminent Persons tasked with advising the government on economic and financial matters, said the project should be suspended, especially following the court testimony by Najib Razak’s former special officer Amhari Efendi Nazaruddin that it was mooted by Barisan Nasional to bail out 1MDB.

He said Putrajaya should hold talks with the Chinese government, which may not be keen on being linked to such projects as its president Xi Jinping steps up measures to curb corruption in his country.

Jomo, who is currently a research adviser at Khazanah Research Institute, said Malaysia has a “huge opportunity” to renew the topic in terms of the project’s integrity and viability, as building the 648km railway may cost the government billions.

At its last estimate, Putrajaya said the project would cost RM44 billion.

Jomo said the ECRL project, to connect Kelantan to the Klang Valley, would be under-utilised and heavily subsidised, forcing future generations to bear the cost as well.

“I am optimistic that Malaysia will approach the Chinese government with this new information which is now publicly available,” he added.

He also urged the government not to be complicit with the actions of the previous administration.

He said the money should instead be used on the people of Kelantan, adding that the state “does poorly on so many indicators”.

For instance, he said, the people in Kelantan and Terengganu need clean water and a mechanism to deal with annual flash floods.

“We need to deal with a lot of problems on the wellbeing of the people in Kelantan,” he added.