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01/09/2017

NAJIB'S $55 BILLION ECRL FRAUD WILL EXCEED $100 BILLION & BANKRUPT MALAYSIA (IF WE LET HIM)!

by E.S. Shankar, Donplaypuks® intrepid correspondent for off-the-rail najiboponzinomics and government fraud affairs. NB $ means Malaysian Ringgit.



(Click on pic for enlarged view).

Malaysia Rail Link Sdn. Bhd. (MRL), wholly owned by Ministry of Finance (MoF) Malaysia, and China Communications Construction Company Ltd. (CCCC), wholly owned by the government of China, signed the $55 billion East Coast Rail Link (ECRL) contract back on 2nd November 2016.



THE PROJECT

The salient details of the 688 km DIRECTLY NEGOTIATED NO OPEN TENDER contract are:

1. Phase 1 - 600.3 km connecting Gombak in KL with Wakaf Baru in Kelantan.
2. Phase 2 - 87.7km connecting Gombak in KL with Port Kelang in Selangor.
3. Phase 1 & 2 cost - $55 billion.
4. Costs include $9 billion provision for rolling stock i.e. locomotives, carriages, wagons and other railroad vehicles. Rolling stock is to be purchased by CCCC. (Why on earth would a works contractor be asked to buy the rolling stock when it would be much, much more economical for MRL to buy direct from suppliers through open tender, unless of course, Najib plans to steal more money by inflating the true cost?).
5. Expected completion date - 2024.
6. Single electrified railway track built on double-tracking formation.
7. MRL will be the owner and operator of ECRL.
8. CCCC will be the main contractor responsible for engineering, procurement and construction management.
9. EXIM Bank of China will be providing MRL with a 20-year 3.25% p.a. $55 billion "soft-loan" package to finance the project.
10. MRL will NOT have pay the principal or interest for the first seven year of ECRL's operation,s i.e. between 2025-2031.
11. MRL will repay the loan in full over the next thirteen years, i.e. between 2032-2044.
12. Projections prepared by Najib's con men show that crucial to the profitability and cash flow of ECRL, is that freight loads will increase to 53 million metric tons by 2030. This is a wee bit optimistic, given that the entire rail freight business under Malayan Railways (KTMB) currently adds up to 6 million metric tons a year!
13. MRL has not disclosed if CCCC has been contractually bound to guarantee freight loads, given that it will be its main customer.
14. The ECRL contract cost works out at an astronomical $80 million per km. However one looks at it, this will turn about to be the most expensive railway line in the world!

NAJIB/UMNO/BN DELIBERATE MISINFORMATION

As there has been deliberate misinformation by Najib and his government of thieves, plunderers and looters about this largest government contract ever, it is necessary to remind all Malaysian that:

1. This is NOT a Foreign Direct Investment (FDI) project with money coming from China as an investment! CCCC will not be investing one cent in anything here.
2. CCCC will be engaged purely as contractors and the Malaysian Taxpayers will have their blood sucked out out of them.
3. The $55 billion will eventually leave Malaysian shores, of which at least $29 billion will be fraudulently used by that serial liar and defrauder Najib, to bail out 1MDB, as detailed in my earlier blog post. CLICK HERE.
4. By comparison, countries like Thailand are getting double tracking trains on double-tracking formation, with twice the speed for rail freight transportation, for costs that are not too far off from ECRL!!!

Of course, Najib's PR blitz comes with all the usual bells and whistles:
1. GAME CHANGER! How? With a train stopping at over 20 stations at a top speed of 160km/hr and half that for freight coaches?
2. Zillions of jobs (CCCC will be engaging mainly their own sub-contractors for sure).
3. Opening up of the Ease Coast. With this kind of inflated costing, how will our poorer cousins afford the fares?
4. Guaranteed local participation (though when push comes to shove, CCCC will derail Najib's Bumiputra dreams quicker than you can say char sui sui yoke!).
5. Alternative logistic route to Singapore (one wonders if there will really be any material cost savings in offloading and loading goods in Klang, the train time and downloading/loading in Kuantan).
6. Najib sycophant Minister Rahman Dahlan was quoted as saying "In a green-field rail project of this nature, other costs such as engineering studies for design speed, topography, geological conditions will be required." (This is not been the normal world-wide for the last 40 years?)

One could not put it better than an excellent expose by ex-diplomat Ignatius Xavier. CLICK HERE.

TRUE LOAN & INTEREST COST

There is no free lunch. Interest, though not payable for 7 years, will be compounded and accrued for 2025-2031@ 3.25% p.a. 

This means the $55 billion loan will balloon by another $13.8 billion to 68.8 billion by end 2031.

ECRL total cost will then be about $85 billion (rounded off to nearest billion), as follows: 

1. Cost at 1.1.2025 - $55 billion.
2. Interest 1.1.2025-31.12.2031 on $55 billion compounded @ 3.25% p.a. - $14 billion.
3. Interest 1.1.2031-31.12.2044 on reducing loan repayment basis @ 3.25% p.a. - $16 billion.

Loan Principal and Interest to be serviced will amount to about $18 million and $6 million respectively PER DAY, for 13 years (156 months)!!!

If we add on 30% for land acquisition, price increase (inflation), Variation Orders (VO) and contingencies, we are easily looking at a cost in excess of $100 billion!!!???

Of course, once ECRL starts operations in 2025, presumably the revenue stream will start flowing in to service interest and capital loan repayments. 

But, it's safe to assume that for at least the first ten years, profits will be insufficient to service RM85 billion, given KTMB's experience, where in some years it made a gross loss!

MORE DEBTS > $300 BILLION

So, in 2031 or so, MoF will have to start issuing bonds to pay EXIM Bank. Besides this $100 billion, there are other debts that can only be extinguished by MoF issuing more bonds now. These include:

1. 1MDB debt - $80 billion.
2. PFFI - $ 30 billion
3. LRT/MRT -$120 billion (?).

This is a route to bankruptcy. More so because, ECRL started off with a government forecast of $26 billion and when the Najib-spawned 1MDB $46 billion fraud got our of control, was inflated to $55 billion to rescue 1MDB! We have a madman at the nation's helm.

When a country goes bust, it simple means it will face severe recession, wages will fall while living costs go through the roof, businesses will shrink or close down completely and millions will become jobless with no safety net!

Then, we will have to go begging to the IMF or World Bank for a massive loan to tide us over. With those loans will come stringent conditions which basically means the party is over.

Will Najib be there then to say sorry and make amends? No way! And that is the measure of the real evil in Najib and his government of thieves. They know it! They are willing to go for broke due to their utterly corrupt and murderous nature, their greed for money and the good life, totally at the Rakyat's expense.

THEY CAN GET AWAY WITH IT, ONLY IF WE LET THEM!

WE MUST DERAIL THE EVIL AND SATAN THAT GOES BY THE NAME OF NAJIB!

refer also M. Gunasegaram's Mkini article '10 Reasons why we do not need $55 billion ECRL'. CLICK HERE.

39 comments:

SP said...

Obviously we are heading the Sri Lankan and some African countries route due to decisions taken by a "non-public officer 1 or MO1" as ruled by the Courts. Who cares as long as vested parties' pockets are full and let the masses and Rakyat rot in hell. With a weak and self-centered Opposition. The untold miseries and sufferings for generations to come of Malaysia due to selfish decision taken now, Malaysia Boleh!

Bruce said...

He is the world most deadliest DRACULA. WTBF.

Ross said...

Ketuanan supremacy, they are untouchable. Corruption is semua ok kut.

VM said...

OMG, we are helpless Malaysians.

Donplaypuks® said...

We are not helpless. Everyone should write to their MP/Adun demanding they question Najib and the govt in Parliament and every opportunity they get. People power can defeat these crooks!

VM said...

Agreed people's power is greater, our major problem is cash is king.

SP said...

even questioned in Parliament never a response due to "Parliament akin to Malaysia's kangaroo Court set up"...

Ho said...

The only avenue for Malaysians to stop all these is vote for CHANGE!

K.Samy said...

BN must be archived for good come PRU 14

Karl said...

Send in the auditors. Get the facts. Why resort to fake reporting? Got calculator pic summore

Donplaypuks® said...

As you must be aware, the new Auditor-General is a non-accountant/auditor whose husband swore that he would die for Najib!!! http://www.thesundaily.my/news/2170199 and http://english.astroawani.com/politics-news/i-am-willing-die-najib-kepong-umno-chief-70961

Soon said...

Sell those diamonds and handbags!

Donplaypuks® said...

2nd hand value of diamonds & birkin handbags can't service interest

KO said...

ECRL.project have to be cancelled if opposition wins. Whatever it takes. To me a toll free super highway is more suitable for Malaysia. An ECRL is not feasible mainly because the expected passenger density is not high enough to cover back the cost even with the lowest open tender. A toll free highway will benefit all especially for commerce!

Rose said...

Where are the revenue expectations to pay off this white elephant? How many trains a day are planned to use this line. What is the number of expected container traffic? What is the number of predicted passengers? Has any such study been done and by which transport research company? If so where can this report be examined?

Donplaypuks® said...

We have to assume the projections have been done. But it's all hidden under OSA. One projection that freight will increase from 6 million tons to 53 million by 2030 looks like pie-in-the-sky nonsense. Also, like the $36 billion west coast double-tracking rail projections, the reality is far, far away from projections inflated and worked backwards to justify the cost. KTM has been turning in huge losses for many years, in some years, gross loss!

Wong said...

Not included is the raping of our natural resources along the route by these approved UMNO/BN cronies/rapists!

Magnus said...

These type of bad governanance drove Argentina and Brazil down the tubes.....otherwise they would be economically like Australia, Canada.

What is especially gauling is for Bumiputras, that yell so loudly against Malaysian Chinese/Indians, to so easily strip the country bare ----- I love Malaysia, and at very least expect the leadership to protect the country's long term future.

I'm not a fan of NEP --- and perhaps the years of pandering to Malays, and bred a corrupt elite that only care for themselves and not the masses (not even the Malay masses).

HPL said...

This is called asset stripping. Note the seven years grace period. By the time a new gomen comes in (whoever) the country will be DEAD BROKE. Countries don't go bankrupt only citizens will be pauperised.

SKG said...

Ena de! Nandri! Tambi blogger,not expert report delivers the knockout punch! Look at this article below written by a famous analyst who must have received Jib's dedak: Dont allow corrupt China to colonise us like what happened to our subcontinent brothers in Tibet,Sri Lanka and Pakistan!
http://www.themalaymailonline.com/.../najibnomics-good...

Donplaypuks® said...

E-con "experts" like Bruce Gale who live in ivory towers have no idea how much the masses are suffering from Najib's poor e-con Najiboponzinomics! Nor do they do the simple math to understand wasteful inflated and fraudulent Ali Baba projects like ECRL

FAB said...

Najib makin terdesak dan tidak ada kekuatan untuk membendung hutang 1MDB sehungga sanggup berhutang dengan Cina.

Beliau terus mengambil kesempatan ini dengan mengambil resiko yang tinggi hingga tidak memikirkan kesulitan generasi akan datang yang akan menanggung hutang negara.

Sikap tidak bermoral ini perlu di haspuskan dan PM Najib perlu berundur dengan hormat kerana negara sudah tersangat terbeban dengan polisi polisi Najib yang semuanya menyusahkan rakyaat.

Donplaypuks® said...

If you add up all the projects that suddenly Najib wants China to finance - ECRL, Melaka Gateway, Carey Is, War ships etc., it will exceed $300 billion, all with money we don't have, i.e. with borrowed money. Our national debt already exceeds RM650 billion!!! This is a recipe for financial disaster and eventual colonization by China. Is this what our forefathers fought for to gain independence from the British, and then fought the Communists for? To be colonized economically by China? We must vote Najib and his govt of traitors out, out, out!!!

DP said...

Signature signed for Demise Of A Country if it goes on like this.......huhu

IB said...

Melayu bunuh Melayu..Melayu gadai tanah air Melayu kito Ni...bkn DAP..

S. Yang said...

How to remove & send him to Sungai Buloh prison without much ado ? Catch him before he can run away !! Too elusive & cunning of him. Be wary of his movement.

K.Puah said...

You are the worst PM and the finance minister and only in Malusia a minister with 2 posts

BS Teng said...

All project implement by BN are costly after completed, delay, material increase and so on

Malcolm said...

I think total of all the MRT lines now and future may just add up to that but how many lines is that 4 to 6.

Always overpriced to line their own pockets just like buying submarines!!!

Donplaypuks® said...

The actual cost with interest + land etc will exceed RM100 billion. Revenues for at least the first 10 years will be insufficient to service interest, never mind loan principal! Keep in mind total KTMB freight tonnage for whole of Msia is currently 6 million. How is MRL going to achieve 53 million tons by 2030? Pie-in-the-sky projections!!!

Donplaypuks® said...

Total MRT will be close to RM120 billion when completed!

SKG said...

20 years ago people mocked Mahathir for building the first KLIA at massive cost.It remained underused for many years and people laughed at mahathir for bleeding the country.
Fast forward today and we are forced to build KLIA 2.

And people are complaining today that the KLIA is operating under capacity .
Twenty years ago people here developed the cities using road and parking design standards for the million or so residents of the Klang valley.20 years later the roads are choked by 10 million and many bypasses and mass transport systems have to be built and people are discouraged from driving their cars,because there are too many cars.

Who knows what will happen in the future,even in my personal capacity,I cant even dream of the population explosion in the Klang valley.Twenty years in the future Malaysia may be a highly connected country with rail travel the standard of that in the UK or Japan,not rural Australia.Did the governments of UK and Japan do feasibilities before building their railines or did they just go ahead?Did they allow Andrew Carnegie to privatise the lines between the Pacific and the Atlantic?

Who knows what the world will be like in 20 years time?
The GNI of Malaysia was close to rm 500m duting Mahathir's time,today it is rm1300b.Apparently my crystal ball is not working.
Not everything in the world is down to dollars and cents.
we are talking of a body of knowledge and industry that is highly specialised and technical and the realm of engineers,not accountants and politicians.Leave the technical things to the technical experts and technocrats..

20 years ago people were sniggling at the thought of Communist China becoming a huge capitalist economic power,did it happen?Now when China sneezes the world catches cold.How did India,for example progress in comparison?
Like · Reply · Sep 4, 2017 6:15am · Edited

SKG said...

There are enough provisions to take care of the average malay,if they work longer hours,enhance their skills and productivity and spend less time building soccer teams in their homes or preparing for the afterworld.Without oil,there is not enough loose cash to make every one jovial millionaires without them working hard for their money.
Inflated is your view,are you an Engineer who understands the risks in building thru soft Malaysian limestones and their possible collapse and sinkholes?
Fraudulent project? Do you understand the implications of the OBOR?
Do you mean unprofitable projects like Putra Jaya,Penang Bridge,Second Link,KLIA,LRT,MRT etc.are all fraudulent too.
Bruce Gale has been around long ago.Are you at least an economist like him or an accountant in Australia who knows everything and are not in touch with Malaysians on the ground instead of relying on 2nd hand info?
I may not agree 100 % with Bruce Gail as he tends to underate the corrupt feudalistic political system,nor with your accountant views.
I prefer to judge from the views of international experts and not write subjective as opposed to objective unemotional views and not relying on 2nd hand info from other blogs,as opposed to expert papers.
There is a wide audience in social media,and too many gullible and unthinking 3rd world minds reading blogs.Its better to be professional and to speak from a position of authority,unlike sickoes like say RPK always trying to poison minds with rubbish.
Old saying-" A little knowledge is a dangerous thing." Put your money where your mouth is and speak from a professional's viewpoint,and be prepared for professional liabilty suits.
Because your blog doen't have a genuine name,I have to tell people the lenses you are wearing to view the world.This is not australia here,we have diverfied worldviews here,only a blinkered fool will insist on being a vegetarian when everyone else eats meat and reap superior health benefits.

Donplaypuks® said...


E.S. Shankar ·
Gan Sg Kg I have already given independent references on this cock-eyed ECRL project inflated by RM29 billion - Sarawak Report, ex-Msian Diplomat Dennis Ignatius and M.Gunasegaram of Mkini. Here is a 4th - ex,Najib advisor & Economist Lim Teck Ghee. Refer http://www.freemalaysiatoday.com/.../economist-ecrl-hsr.../.

Bruce Gale knows nothing about what's happening at ground level in Msia. Many of my blog posts are based on detailed research and not just 2nd hand information. Many, including at PMO level have not done the math as I have on the real cost of ECRL, excluding environmental issues. Why award such a large contract without open tender to a company banned by the World Bank? My objection is more on Najib's fraudulent inflated cost to cover up for 1MDB's humongous loss than on economic viability, which itself is dubious. There are international norms/yardsticks for any type of infra project. Have you read any reports from "economic experts" supporting the RM55 billion price tag on ECRL?

SKG said...

oh yes I have read reports on the economics of the ecrl from all viewpoints,you only have to google it.Do you read Chinese FIRST HAND?Do you know for a fact that the majority of all rail projects in the world never recover money and have always been bailed out by taxpayers and serve a social function like airports,captial cities,bridges,public hospitals,universities and the like?If every infra project has to make money,we will still be travelling around in bullock carts on dirt roads.So why flog a dead horse?
Fellow tambis Dennis Ignatius,and Gunasegaran experts on infra? Are they engineers who have expertise and experience on tunneling through limestone?Do they have a Tibetan agenda of regaining it from China and restoring the Dalai Lama?I have utmost respect for you for regarding Sarawak as a reliable source of info,the very fact it keeps spinning the same tale like a broken record.
Of course there are international yardsticks for most things,but do you compare apple to oranges? Can an accountant tell one rail line from another over different terrains and conditions and use yardsticks?I have experience of building thru young Malaysian limestone and understand the uncertainties,any engineer can tell you that there is no such thing as a budget for building thru limestone.If you still cannot understand this statement,go back into your retreat.
You mean the possibilty of the ECRL contract been rigged is the subject of detailed research and not mere speculation and hearsay? Do you really understand the meaning of the word RESEARCH?
Say whatever you want,using emotive language to colour your arguments are of no help.
Your articles can sit safely in your blogspot to placate your fans,but when they are exposed to a wide audience,be prepared to face challenges.

Donplaypuks® said...

SKG, Do the majority of these projects have RM29 billion added on as a blatant fraud by their PM/Leaders?

You obviously have no idea that M.Gunasegarm is 1 of Malaysia's best-known writers on govt infra projects and Plcs etc., having been with the Edge for a long time before moving to Mkini. Dennis Ignatius' credentials are impeccable, just ask Lim Teck Ghee who I know personally and have communicated with on ECRL. You still have doubts after LTG's article, where for ibvious reeasons, he can't say all he wants to, and has to soften his tone?

Sarawak Report is not stuck on 1 track; it has exposed 1MDB, ECRL, Pan Borneo Highway and many, many corruption issues in mainland Msia and in Sarawak & Sabah involving Chief Ministers and Najib's cronies.

It looks like you (I take the liberty since you condescendingly refer to people as 'Tambi') a chinchong in Australia are prepared to do nothing while corruption inflames Msia. All talk and no trousers, or as they say in Malaysia, NATO (No Action, Talk Only). And yes, I know all about those govt stats and budgets and GNI etc. and yes, there are many accountants who do understand railway and infra projects very well. And yes, we do understand economic necessity v strict financial viability. It depends on one's experience and exposure does it not? Let's see you write something that will help Msians fight endemic corruption within government, or anything that will inspire fellow Msians to get rid of a govt of thieves!

SKG said...

YAAAAAAWWWWNNNN..Calling people tambi is mild and hardly racist,just like younger brother ,at least i dont use words like Nig Nog ,darkie ,Kling or WOG.its appropriate for people with clear anti China agendas. We have ebough cyber warriors let alone people who think they know everything by poisoning minds with second hand info and inept technical knowledge,very pro and responsible citizenry, and I'm not refering to you.
Doesn't alter a thing,corruption has been around in Msia long time ago,we live with it daily,the kind of corruption highlighted today . it is so endemic that people who dont practise it are the exception and it is all down to the NEP.You dont realise that you are mainly being manipulated by politicians to do their dirty work, as we say here,being used as knives to kill opponents.

Spend more of your energy and old age fighting people like Pauline Hanson and Australia's problems like ISIS instead from your armchair in ivory tower ..

SKG said...

the government of thieves has been around since 50 years ago,how they commit theft depends on varying Modus Operandi which advances to keep pace with advancing technology and new laws.
I have been fighting corruption since the days I graduated but had always to stage a lone battle like serpico.
I think the Muslims get it right in the battle to fight corrupt regimes,things like ISIS,suicide bombers and the like,and to Tibetans self (emolution?),Arab Springs etc.
Definitely I cant do it as a cyber warrior as there are already too many around.But I can do my part by revealing fallacies and lies spread on the internet and offer a balanced view and directing people to the correct targets.
As we say in Malaysia,if you tell lies often enough or amplify and magnify other people's lies,it will eventually become the truth.Who else better in it then the so called government of thieves via education and the BTN.

SKG said...

"Sarawak Report is not stuck on 1 track; it has exposed 1MDB, ECRL, Pan Borneo Highway and many, many corruption issues in mainland Msia and in Sarawak & Sabah involving Chief Ministers and Najib's cronies."

Really! Time for Sarawak report to reveal all the money laundering of previous regimes buying properties in London,Hollywood and Australia and having offshore accounts and all the crooks who syphoned off tax money or enriched their children during previous regimes.Sarawaks White Hair,the one removed after Mahathir's time?

Very professional of Sarawak report offering such a balanced view, you'd think they have some kind of malicious intent beneath the surface.who are they working for,not that I doubt some of the info they revealed.

Is Sarawak Report an expert also on Civil Engineering Technology?