KUALA LUMPUR: Malaysia's Finance Minister Lim Guan Eng believes countries like China and Singapore understand why it has had to review mega projects such as the China-backed East Coast Rail Link (ECRL) and the Kuala Lumpur-Singapore High Speed Rail (HSR).
Lim told Channel NewsAsia's Conversation With that his new government is still dealing with the more than US$251 billion debt and liabilities left by the previous Najib Razak-led administration.
Malaysia will therefore exit the HSR deal, which it says could cost the country RM110 billion (US$28 billion) with interest payments, while terms of the ECRL are being renegotiated.
"We are confident China understands our debt predicament and they'll be willing to help us out, give us a helping hand," Lim said.
"As far as the HSR is concerned, it's scrapped for now as announced by the PM but in the future, that is something that we want to discuss with the government ... In that sense, we're talking about the possibility of deferring and discussing with our good neighbours Singapore to see how they can help us out of this debt predicament."
The Minister believes Singapore understands Malaysia cannot add on to its debt load at the moment as it tackles problems related to state investment firm 1Malaysia Development Berhad, he said.
"We also need to make all these repayments for some of these high-cost projects, for these scandals and I'm sure Singapore would understand that this is not the moment for us to embark on high-cost projects such as the HSR."
The former Penang Chief Minister said Malaysia would consider reviving the deal in the future: "A year from now, 2 years from now ... it's something that we need to discuss," he said.
A legally-binding agreement for the 350km rail deal was signed by former PM Najib's government in 2016, with plans for it to be completed by 2026. Prime Minister Mahathir Mohamad has said it would cost Malaysia up to RM500 million to pull out.
In earlier comments to the media regarding the RM500 million compensation sum, Johor Chief Minister Osman Sapian said it was better for the government to bear such short-term losses, than to bear the debt burden of more than RM100 billion.
Watch the full interview on Conversation With, Thursday, Jun 21, at 9.30pm (SIN/HK)