KUALA LUMPUR: The RM44 billion East Coast Rail Link (ECRL) is expected to contribute 2.7% to Malaysia’s economic growth, says MIDF Research.
It said the growth is expected to kick-in from project inception until completion.
“However, the full estimated gross domestic product (GDP) contribution will depend on the pace of spillover effects to other economic sectors.
“As the project requires machinery and transport equipment, our estimate shows imported commodities and consumption of fixed capital to increase by 3.3% and 2.1% respectively,” it said in a research note today.
Moving forward, MIDF Research said the railway project would result in economic expansion through job creation, opening up new areas, foreign direct investment, increase in external trade activities and boost in domestic demand.
The research house expected that since 70% of the transportation would be for freight purposes, the project would be a catalyst for industries and exporters in Malaysia.
“It also gives Malaysia an advantage in international trade due to the project’s strategic location to China and Asean nations.”