With CREC collapse in Bandar Malaysia a war of words erupts

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Picture Credit: Yahoo News Singapore

After the Forest City debacle, now the Bandar Malaysia story is out in the open with a war being waged between the consortium and the embattled TRX City.

But there is more to the story than what is being told.

The Independent, in a story on Iskandar Water Front (IWF), noted that the Johor-based company was raising funds to pay for massive debts.

With this in the background and the Bandar Malaysia-CREC deal collapse yesterday, it is clear the Chinese are leading the Malaysian government into a fairy tale.

Yesterday, TRX City Sdn Bhd announced it tore apart the MoU the Chinese company CREC signed with for the development of Bandar Malaysia.

It said CREC’s consortium with IWF failed to put up with the promised cash consideration for the taking over of 60% of the project, thus forcing it to terminate the deal.

But the Iskandar Waterfront Holdings Sdn Bhd (IWH)-China Railway Engineering Corporation (M) Sdn Bhd (CREC) (IWH-CREC) consortium seems to be on the war path, rejecting the claims made by TRX City.

LEGAL ADVISE SOUGHT

in its response, IWH-CREC said the reasons given by TRX City does not fully and accurately reflect the circumstances and conduct of the parties in this matter.

“We take this matter very seriously and is at present reviewing the content of the Termination Notice and press release, with advisors and legal counsel,” it said.

It will make further announcements in due course, said IWH-CREC, though we believe the story might as well end there since the Malaysian Government played the spin with the collapse the Bandar Malaysia deal.

The termination of the deal by TRX City has given the Ministry of Finance (MoF) headed by Prime Minister Najib Razak the opportunity to project itself as the ‘saviour’ of Bandar Malaysia and of the Tun Razak Exchange.

TRX City said in a media release yesterday the termination of the deal allowed the MoF to regain 100% control of the project “for the benefit of the Malaysian people.”

SPIN FAIL

Really? Or it is a failed spin?

If the MoF is now rescuing the TRX-Bandar Malaysia project, then why did it agree to the deal with the China’s CREC in the first place?

In between the signing of the MoU and the collapse of the deal, there has been several ‘signings’ and ‘shows’ headed by the Minister of Finance cum Prime Minister over the months.

These were to show that the projects were right on track and that money was pouring in from China.

The TRX City press release also said the salvaging of Bandar Malaysia by the MoF shows that the government is not ‘selling the country to foreigners.”

Which is weird indeed.

HSR IN TROUBLE

It is the same government that is publicising its China-billion-dollar deals with trumpets, and now it says it is salvaging the projects from China?

Nevertheless with the reality now exposed – that is the China Railway Engineering Corporation is not cash rich as it was touted to be, the question now arise on the future of the High-Speed Rail between Malaysia and Singapore which is said to be a project that the Malaysian government will have over to China?