COMMENT | Singapore HSR will dwarf 1MDB's RM42b losses

COMMENT | By the time the high-speed rail (HSR) link to Singapore, currently priced at an estimated RM100 billion, is finished in 10 years or so, the cost would have escalated to perhaps more than twice that at some RM200 billion.

This project, which was abandoned and had RM320 million paid to Singapore as compensation in March 2021, is set to resume with the necessary processes already being rolled out. Seven consortia have submitted requests for information (see table for a timeline).

Transport Minister Anthony Loke pooh-poohed any suggestion that the withdrawal of Japanese firms from the project would jeopardise it as many others were still interested. The Japanese were said to have withdrawn because the project is not viable without government support.

Loke said in March last year that the HSR could continue if it was not funded by the government. But it is impossible to see how the project can continue without some kind of government support - if not funding, then a guarantee. Loke was silent on the matter of a guarantee.

Any kind of financial support, including guarantees, means the government bears the risk much like the obligations that 1MDB made over the years from 2009 (15 years ago), leaving the government with liabilities of an estimated RM42 billion over the life of the borrowings. That’s before...