Sunday, April 27, 2008

China getting concerned over 2nd Penang Bridge

China getting concerned over 2nd Penang Bridge
KUALA LUMPUR, April 27 - All the fuss about the Penang Second Bridge and talk of delays has caught the attention of the Chinese government.

Officials from China Harbour Engineering Company (CHEC) have been asked to submit a report within the next 24 hours to the Ministry of Commerce, who are peeved that a project in which a Chinese company is involved in is mired in controversy. Beijing also wants to know if the US$800 million loan to Malaysia is viewed as helpful or an impediment by stakeholders and the public.

The Malaysian Insider has learnt that top Chinese leaders have taken a keen interest in the 24-km-long bridge, seeing it as an opportunity to cement their special relationship with Malaysia, reiterate their commitment to the region and defy critics who argue that an economically strong China will be a military threat.

Government officials are unsure if Beijing will urge CHEC to cut their losses and pull out of the RM4.3 billion project but this week is shaping up to be a crucial one for all those involved in the crossing. Tan Sri Zaini Omar, the head of the task force overseeing the bridge project, is scheduled to have a final sit down with all the stakeholders – the Ministry of Finance, UEM, CHEC – and finalise cost and design issues.


He is said to be mulling over several options including costing portions of the bridge independently and offering them to UEM and CHEC as a fait accompli or asking UEM and CHEC to allow their cost structure to be open to public scrutiny.

CHEC has told the government that its 17-km sea portion will cost RM2.3 billion while UEM has said that its 7-km land portion and fabrication work will cost nearly RM1 billion and RM1.5 billion respectively. After some nudging from the government, UEM is prepared to reduce the cost of the land portion to RM700 million.

Government officials say that CHEC – which has built some of the longest bridges in the world - has indicated its willingness to have independent parties verify its costing for the sea portion. The Chinese construction company has informed the government that it is still confident of completing the sea portion by 2011 if all the red tape and differences are sorted out within the next two months. UEM is set to make its case before Tan Sri Zaini and the Ministry of Finance this week.

The government said on Saturday that it would proceed with the bridge once the construction cost, design and land acquisition process had been reviewed. Second Finance Minister Tan Sri Nor Mohamed Yakcop told reporters: “This does not suggest that the federal government is reviewing the project with the intention of scraping it.” He was referring to speculation that the Federal government was going slow on infrastructure projects in Opposition-held states.

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