China’s Major Belt and Road Project in Malaysia to Remain


Bloomberg says in its report “Malaysia Nears Deal With China to Revive $20 Billion Rail” on February 19 that Malaysia has been successful in renegotiating with China on reduction of the cost of the East Coast Rail Link (ECRL) project that Western media regarded as canceled.

Why is Malaysia so anxious to keep the project? That major Belt and Road project benefits Malaysia as it facilitates Malaysia’s railway link with China through Laos and Thailand. Such link was advocated by Malaysian Prime Minister Mahathir when he was prime minister more than a decade ago. With ECRL Malaysia’s port at its western coast will be as important a transport hub as Singapore for China’s exports to its west as it provides railway route for China to bypass the Malacca Strait.

I have pointed out in my post that China has three alternatives to bypass the Malacca Strait for its 21st maritime Silk Road (Belt and Road is the shortened expression of China’s Silk Road economic belt and 21st maritime Silk Road): The Kra Canal, the rail link to Myanmar’s sea port in Bengal Gulf and the rail link to Malaysia’s western coast.

China has built pipelines linking China’s southwest to Bengal Gulf through Myanmar and concluded agreements to build a Myanmar port at the gulf for the link. What Myanmar and China further need is but a railway linking the port with China’s southwest parallel to the pipelines. As a result the link to Malaysian’s eastern coast will but be an alternative to the Myanmar link. Therefore, Malaysia is now more anxious to have the link than China though it finds ECRL too expensive to afford.

The railway will facilitate the development of Malaysia’s underdeveloped areas. It will benefit Malaysia much more than China. That precisely proves the benefit of China’s Belt and Road initiative that provides much needed funds for developing countries in building the infrastructures indispensable for their economic development.

The initiative proves Chinese President Xi Jinping’s mastery of China’s traditional art for being an emperor, the top wisdom of China’s greatest statesmen in Chinese history.

The art is first of all a balancing art.

When China is under the pressure of Western powers led by the United States due to the mindset arisen from Thucydides trap, China shall have found the strength to balance Western powers.

First, China has succeeded in setting up a de factor alliance with Russia to balance US military power.

Second and more important, it has launched its Belt and Road initiative to help developing countries grow into powerful rising economies that balances the economic power of Western developed countries.

Poor United States, jealousy at the gains China will get from its win-win cooperation projects through the initiative does hurt but its trouble is much more greater in dealing with the rise of not only China but also the developing countries in Asia, Eastern Europe, Africa and even Latin America due to China’s Belt and Road initiative.

Comment by Chan Kai Yee on Bloomberg’s report, full text of which can be viewed at https://www.bloomberg.com/amp/news/articles/2019-02-19/malaysia-nears-deal-with-china-to-revive-scrapped-rail-project.

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US Indo-Pacific Commander’s Illusion about Malaysia due to Sinophobia


Washington Free Beacon’s report “U.S. Bolstering Pacific Military Forces to Counter ‘Massive’ Beijing Buildup” on February 13 on US Indo-Pacific Commander Adm. Davidson’s says that when Davidson testified to US Congress on February 12, he described China’s projects as “debt diplomacy” and said that Malaysia cancelled three projects with China worth $22 billion in August 2018 over concerns about Beijing’s corrupt practices and denouncing the loans as Chinese “colonialism.”

The fact is the major one of the three projects the ECRL that account for about $20 billion in the $22 billion has not been cancelled. SCMP says in its report “Malaysia ‘values China’: Mahathir signs up to Xi’s second belt and road summit” yesterday, “Mahathir said that ‘no final decision’ had been made and that the two nations were still discussing the matter” after Malaysian Economic Affairs Minister Azmin Ali said the project would be cancelled in late January.

SCMP begins the report saying “Malaysia’s Mahathir Mohamad has become the first world leader to confirm his attendance at China’s second Belt and Road Initiative summit this April, in a move analysts say is aimed at reassuring Beijing of his commitment to the project.”

The above being the fact then was Adm. Davidson tell lies to Congress about China’s Belt and Road being regarded by Malaysia as “colonialism” and three projects worth $22 billion having been canceled?

Some people perhaps believe that Adm. Davidson told the lies to create sinophobia in the US in order to make Congress to grant a larger military budget, but I would rather believe that he is an honest officer, otherwise he would not have been promoted to his high military position. However, he is so sick with sinophobia that he regards China’s “colonialism” and “debt diplomacy” that exist only in his illusion as facts

All phobia mindsets are characterized by confusing illusion and facts.

That is also the case with honorable US senator Rubio. In his recent report to US Congress, he regards China’s Made in China 2015 programme aims at making high-tech goods to replace 70% of imports as a programme for world dominance, but that is not absurd enough. He even regards Xi Jinping’s China dream of the great rejuvenation of China as China “vying to supplant the United States as the center of power in international affairs.”

He has certainly read Xi’s speech when Xi was elected as CCP general secretary where Xi mentioned China dream for the first time. The context is very clear that Xi wanted China’s rejuvenation to prevent it from suffering from foreign bully again as when China was backward it was bullied by foreign powers for nearly a century.

I reblogged Washington Free Beacon’s report on Rubio’s report yesterday to entertain readers with the absurdness of the sinophobia in the report.

Comment by Chan Kai Yee on SCMP and Washington Free Beacon’s reports, full text of which can respectively be viewed at https://www.scmp.com/week-asia/geopolitics/article/2186379/malaysia-values-china-mahathir-signs-xis-second-belt-and-road and https://freebeacon.com/blog/made-china-2025-beijings-bid-become-global-superpower/.


Lies, Cover-up Cannot Deny Success of China’s Belt and Road


China’s investment in Asia often has great risks due to political instability in the countries it invests in. Myanmar’s suspension of the Myitsone dam project and Malaysia’s scrapping of the east Malaysia railway project are typical examples. However, in spite of the political instability, China has been successful in carrying out its Belt and Road initiative in Asia.

The Myitsone dam project started long before the beginning of Chinese President Xi Jinping’s Belt and Road initiative. It was planned to sell 90% of the electricity the project generates to China’s Yunan Province, but now Yunan has more than enough supply of electricity due to China’s rapid development of infrastructures.

However, the project has now become a Belt and Road one as it will provide power for Myanmar’s industrial development and thus facilitate removal of China’s labor-intensive industries to Myanmar where labor cost is very low.

Anyway, it is not a key project for Belt and Road that mainly aims at providing connection to the outside world for China.

For connection to the areas to the west of China, there may be three routes in which the railway link to Malaysia’s west coast to bypass the Malacca Strait is the last choice due to its long land route across three countries.

The best choice is a canal through Kra Isthmus to bypass Malocca Strait but with the greatest risk. The canal will benefit not only China but also other nations that use Malacca Strait as their major trade route to the west. If China funds the construction of the canal, it has to own the canal to obtain return to its investment but Thailand’s political instability make such huge investment very risky. Moreover, the canal may be nationalized like Panama Canal and Suez Canal.

The best choice seems to be a railway through Myanmar to the port at Kyaukpyu at the Bay of Bengal. China has already built oil and gas pipelines from Kyaukpyu to China’s Ruili and according to The Medi Telegraph’s report “China to develop deep sea port in Myanmar”, China has signed an agreement with Myanmar on the construction of a deep sea port at Kyaukphu with two deep berths.

It is obvious that the port will not be fully useful if it is only used for oil and gas freight to the pipelines. There must be a railway between Ruili and Kyaukpyu, which will not be such a huge investment as Kra Canal but will greatly benefit China and Myanmar. Politically, it is simple as it goes through only one country.

The railway and the port will make the port of Hambantota China is building in Sri Lanka an important transport hub for Chinese shipping to the Middle East, Europe and Africa. From that we see Chinese leaders’ vision in developing the port of Hambantota.

The ports in Sri Lanka and Myanmar under construction, the pipelines completed and the railway if built will be China’s successful 21st maritime Silk Road.

Western media simply ignored the pipelines and port at Kyaukpyu and spread the lies that China’s purchase of 80% shares in the company that has the lease of the port of Hambantota was forced asset-loan swap. They believe by such cover-up and lies they can convince readers that China’s Belt and Road is a failure.

Western and Japanese statesmen are not so stupid as to be deceived by the cover-up and lies. They now are interested in joining China’s Belt and Road or have other ways to invest in infrastructures in Asia and Africa that will ultimately benefit China in providing infrastructures and expanding market for China.

Even the United States has initiated a “Prosper Africa” strategy to contend with China in building infrastructures in Africa. But the United States is hard up. The dispute between President Trump and Congress over a small sum of $5 billion for the construction of a border wall should result in government shutdown! Poor America! Where will it obtain funds to build infrastructures in Africa? It even lacks funds to fix and rebuild its 50,000 bridges in poor conditions!

Comment by Chan Kai Yee on The Medi Telegraph’s report, full text of which can be viewed at http://www.themeditelegraph.com/en/shipping/2018/11/12/china-develop-deep-sea-port-myanmar-ebet6fyKi9LXtA6q16KIXO/index.html.


Malaysia cancelling $20 billion dollar China-backed rail project: minister


January 26, 2019

KUALA LUMPUR (Reuters) – Malaysia’s economics minister said on Saturday the country will cancel the $20 billion East Coast Rail Link (ECRL) project with contractor China Communications Construction Co Ltd.

Mohamed Azmin Ali said at a media event that the cost of the project was too great, while giving an assurance that Malaysia would welcome all forms of investment from China on a case by case basis.

Reporting by Emily Chow; Editing by Simon Cameron-Moore

Source: Reuters “Malaysia cancelling $20 billion dollar China-backed rail project: minister”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


China says will ‘take care of’ debt issues of ‘Belt and Road’ projects, respects Malaysia pull-out


October 13, 2018

NUSA DUA, Indonesia (Reuters) – China’s vice finance minister Zou Jiayi on Saturday acknowledged debt issues with some of its ‘Belt and Road’ projects, saying the government will strengthen macro-supervision on the debt sustainability aspect of its overseas investments.

China has been promoting an ambitious Belt and Road initiative since 2013, as President Xi Jinping expands trade corridors along a modern-day Silk Road linking Asia, Europe and Africa, pumping credit into building roads, railways and ports in a trillion-dollar infrastructure initiative

“The debt sustainability issue of Belt and Road (projects) is a complicated issue, but we will take care of it,” Zou told a panel on the sidelines of annual International Monetary Fund and World Bank meetings in the Indonesian island of Bali.

The senior finance official said China could optimize and diversify its Belt and Road debt financing with more foreign direct investment, public-private partnerships, and equity investment, as opposed to commercial loans that could be more expensive.

But the initiative has been met with growing scepticism as some countries, such as Sri Lanka, became saddled with debt that they had difficulty in repaying.

One of the top recipients of China’s largesse, Malaysia, has recently stopped work on a $20 billion rail link between its east and west coasts, a rare setback for the Belt and Road initiative.

Zou said the Chinese government fully respects Malaysia’s decision-making and judgment, stressing the projects were inked on a commercial basis, and countries are free to vet and evaluate the terms of the projects.

“Malaysia adequately communicated with the China side on the issue. We respect Malaysia’s decision based on their debt sustainability analysis,” she said.

Reporting by Yawen Chen; Editing by Kenneth Maxwell

Source: Reuters “China says will ‘take care of’ debt issues of ‘Belt and Road’ projects, respects Malaysia pull-out”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


China’s Malaysia OBOR Project Suspended to Be Replaced by Myanmar’s


China’s US$20 billion East Coast Railway Link in Malaysia has been suspended SCMP reports today. SCMP says that the project owner has told its main Chinese contractor China Communications Construction Company (CCCC) to suspend work as Malaysia’s new government seeks to renegotiate the terms of the deal with China.
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The railway is part of the railway that provides land connection of southwestern China to Malacca Strait. It may facilitate development of western China. However, there will be an alternative route through the China-Pakistan Economic Corridor to the Indian Ocean. Moreover, China may skip Malacca Strait by building a canal in Kra Isthmus, Thailand or the China-Myanmar Economic Corridor and the developmmt of Myanmar’s Kyaukpyu port.

The Myanmar alternative is a viable better shortcut to Indian Ocean without passing through Malacca Strait as shown in the following map:

Route to Indian Ocean through Myanmar. SCMP map

SCMP says in its report “There’s no Chinese ‘debt trap’, says Myanmar minister, as government pushes for joint port project to go ahead”, “Myanmar’s government is eager to begin work on a Chinese-backed deep water port project in Kyaukpyu, and a decision is expected soon, the country’s union minister and security adviser Thaung Tun said.”

Thaung Tun said Myanmar said that Myanmar will focus on the China-Myanmar economic corridor to connect China’s Yunan with Mandalay in central Myanmar introduced when Aung San Suu Kyi visited China last year.

SCMP quotes him as saying that a railway connecting Ruili in Yunnan province to Mandalay “would start quite soon” and “in all likelihood it would be extended to Yangon and Kyaukpyu” in Myanmar.

China had better give up the Malaysian railway project though CCCC have some problems in dealing with its more than 2,250 local staff members and other indirect hires.

Comments on SCMP’s reports, full text of which can be found at https://www.scmp.com/news/china/diplomacy-defence/article/2153801/chinese-engineering-firm-told-suspend-us20-billion-east and https://www.scmp.com/news/china/diplomacy-defence/article/2153210/myanmar-minister-dismisses-chinese-debt-trap-fears-over.


DSA 2018: Chinese LHD design contends for RMN’s MRSS programme


China’s CSOC displayed a model of an LHD with amphibious capabilities at DSA 2018. The company is offering the design to Malaysia to meet the RMN’s MRSS requirement. Source: Richard D Fisher Jr

Richard D Fisher Jr, Kuala Lumpur – IHS Jane’s Defence Weekly 17 April 2018

A Chinese landing helicopter dock (LHD) with amphibious capabilities is one of the designs being considered for the Royal Malaysian Navy’s (RMN’s) multirole support ship (MRSS) programme, officials told Jane’s at the 16-19 Defence Services Asia 2018 (DSA 2018) exhibition in Kuala Lumpur.

The design being considered appears to be a smaller version of the 23,000-tonne LHD design unveiled by the China Shipbuilding and Offshore International Company (CSOC) at the 2012 Defense and Security exhibition in Bangkok. RMN officials said that the Chinese design could carry up to eight helicopters and would be equipped with a well-deck for deploying amphibious vehicles.

While officials at DSA 2018 stressed that the RMN has yet to select a final design, the experiences made with China’s different production and ship standards as part of the ongoing Sino-Malaysian co-operation to build littoral mission ships (LMSs) for the RMN has led to concerns about the desirability of China’s MRSS proposal. However, the officials also stressed that Beijing’s proposal could remain competitive if it becomes the low-cost option.

Malaysian officials indicated they expect the 15,000-tonne three-ship MRSS programme to be funded in 2018, with a final design expected to be selected in 2019.

The MRSS is part of the RMN’s ’15-to-5’ fleet transformation programme, which seeks to reduce operational costs and increase efficiency in logistics management, while bolstering vessel numbers.

Source: Jane’s 360 “DSA 2018: Chinese LHD design contends for RMN’s MRSS programme”

Note: This is Jane’s 360’s report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.