RM1bil fund for local contractors in east coast rail project

Redzuan Yusof.

KUALA LUMPUR: SME Bank has set aside RM1 billion in financing specially for local contractors appointed for civil work packages of the East Coast Rail Link (ECRL) project.

Entrepreneur Development Minister Redzuan Yusof said the facility is in the form of Term and Revolving financing.

It is capped at RM50 million for each applicant.

“However, if the amount required is above RM50 million, it will be considered on a case-to-case basis,” he said at the signing of an agreement between the bank, Malaysia Rail Link Sdn Bhd and China Communications Construction (ECRL) Sdn Bhd.

His speech was read by the ministry’s secretary-general Wan Suraya Wan Mohd Radzi. Also present at the ceremony was Finance Minister Lim Guan Eng.

Redzuan said that the allocation can be used for contract financing, working capital and purchase of equipment.

“I am confident that with such financing support, local contractors can be at ease and concentrate on completing the projects assigned on time without undue anxiety or worry.”

In August it was reported that the China Communications Construction Company Ltd (CCCC), received 1,321 submissions during the pre-qualification exercise to identify the potential subcontractors for the 40% civil works portion of the ECRL.

CCCC is the engineering, procurement, construction, and commissioning contractor for the 640km ECRL project which connects Kelantan to the Klang Valley. The project is expected to cost RM44 billion.

About 70.7% of the 331 construction companies shortlisted as subcontractors are Bumiputera companies.