Malaysia-China Bridge Building Deal

On one hand, the signing of the RM2.7 billion loan to build 2nd Pulau Pinang bridge seemed like a great way to further strengthen economic and friendship ties with China. It is the biggest loan that China had ever given for a single project to a foreign country. Second Finance Minister Tan Sri Nor Mohamed Yakcop: With this project, we are literally building a bridge with China.

On the other hand, the building of this 23km bridge (17km of it will be in water) beginning November this year and completing by 2011 will put us deeper in debt. The loan will carry an interest of 3% per annum for 20 years. Parties of this agreement: The Malaysian Government, China's Exim Bank and Bank Pembangunan (Malaysia) Bhd. Construction will be by UEM Group Bhd and JV Consortium of China Harbour Engineering Company (CHEC) and UEM Construction.

Hopefully, being a major catalyst for economic growth and investment in the Northern Corridor the cost of this bridge will be worth it. Whatever the outcome, at least we will have South East Asia's longest bridge when it is completed.

Source: Star Online "Penang Bridge loan deal signed"

Update (5:34pm):
For an interesting read on what opposition DAP leader Lim Kit Siang thinks of a past project awarded to UEM and also about the current Pulau Pinang 2nd bridge, click here.