PIMPing the Penang master plan bubble

If the land on “these three eggs” cannot fetch a sufficiently high price, the people of Penang will bear an insufferable debt burden, says the writer.

The two key components of the Penang Transport Master Plan (PTMP) are back on track. These are PIL 1, i.e. phase 1 of the Pan Island Link, and the LRT (light rail transit).

In August 2018, our new Chief Minister Chow Kon Yeow had exuberantly announced that PIL 1 and LRT would be launched in March 2019.

During the town hall meeting on Sept. 30, 2018, held at Dewan Sri Pinang, one of the questions posed was on the viability of the whole PTMP, which was based on the proposed reclamation of the three islands off the southern shore of Penang island and the sale of land thereon to finance the mammoth RM46 billion master plan.

Chow acknowledged then that there would be a cash flow problem and the state was likely to proceed with the LRT first and, upon its completion, PIL 1.

In other words, the two would be seven years apart.

That moment of lucidity did not last long, as both have been proclaimed this week as good for launching together next year.

Like a magician, Chow said that the price tag for PIL 1 was now RM9.6 billion, instead of the RM7.5 billion bandied about last year.

Even better was the statement by the CM that the actual cost of PIL 1 would only be known during the calling of tenders and the submission of bids.

Based on that, it is quite safe to say that the cost of the whole PTMP will balloon way past RM50 billion.

One can be forgiven for assuming that everything is fully funded and that we Penangites will be able to enjoy all these “modern” amenities free of charge and without risk.

Unfortunately, this is not the case.

We are told that the state will own all three islands – but ownership is not an issue.

Penang civil society led by the Penang Forum have protested against the state government’s plans.

The point is that if the land on “these three eggs” (as the islands are commonly referred to) cannot fetch a sufficiently high price, the state will owe money by the billions. By extension, the people of Penang will bear this insufferable debt burden.

Why do we worry? Our federal government can always bail us out, right? Wrong! While our country’s RM1 trillion debt is being reduced bit by bit, what is obvious is that Penang will be on its own.

Do we even know that the interest, even at 0.5% per annum, on just RM1 billion is RM5 million a year or RM400,000 a month? Cool, right? Just multiply that many times over and it’s just the interest on the principal sum of billions of ringgit.

Never mind the fact that the three-island reclamation work will destroy most of our remaining fish-breeding grounds. Never mind the fact that the livelihood of thousands of fishermen is at risk.

We will sit up in rapt attention only when the price of seafood triples or quadruples in four years’ time.

It is entirely foreseeable that PIL 1, the grand jewel, could well be abandoned halfway if payment is not forthcoming from the land sales.

Let’s hope that at that time, they have not finished drilling and blasting (5,000 tonnes of explosive will be used) past the fault-line zone at Penang Hill, where at its nearest, PIL 1 will be only 350 metres from the base of Air Itam Dam – which at this point in time a landslip problem is being addressed.

Best of all, the Penang Transport Master Plan is not the original plan put forward (in 2013) by Halcrow, the British transport consultant brought in by the state government. The Halcrow PTMP was based entirely on revamping our public transport, thereby addressing our traffic congestion.

The current PTMP is primarily focused on infrastructure. It should more correctly be called “PIMP” (for Penang Infrastructure Master Plan). If Penangites don’t wake up soon, “PIMP” will massively degrade our environment and likely land us in bankruptcy.

One can easily predict that the looming global economic crisis will bury PIMP — and do us all a great favour.

Eric Cheah is an FMT reader.

The views expressed are those of the author and do not necessarily reflect those of FMT.