An oil pipeline in Pangerang in Malaysia's southern state of Johor (Source: Reuters)
Malaysia has cancelled three China-backed pipe projects, after they were suspended in July.
Malaysian Finance Minister Lim Guan Eng said that the cancelled projects were two oil and gas pipelines that cost more than 1 billion USD each, and a 795 million USD pipeline linking Malacca state to a Petronas refinery and petrochemical plant in Johor state, the Financial Times reported.
Lim added that he had sent a letter to relevant parties in Beijing to terminate the schemes, without disclosing the cancellation fees Malaysia would incur for ending the pipeline contracts.
On August 21, Malaysian Prime Minister Mahathir Mohamad said that the three other Chinese-funded projects would be cancelled until Malaysia can afford them.
They are the 20 billion USD East Coast Rail Link (ECRL) project and two natural gas pipeline projects worth 2.3 billion USD in Sabah and Kedah States.
Mahathir explained that if Malaysia continues implementing these projects, it will need to borrow a huge amount of money that the country could not afford.
These projects are not necessary for Malaysia now as the country has to work hard to fix domestic financial deficit, he said.
At present, the Malaysian Government is exerting every effort to reduce the national debt, which has climbed to 250 billion USD, he added.
VNA
