Chinese railway delegation vies for Kuala Lumpur–Singapore high-speed rail project

General

A Chinese railway delegation led by Sheng Guangzu, General Manager of China Railway Corporation, is kicking off a visit to Malaysia on Monday. The main purpose of the visit is to compete for the Kuala Lumpur–Singapore high-speed rail project, caixin.com reported.

The delegation consists of a number of Chinese railway equipment and engineering companies, including CRRC Corporation Limited and China Railway Construction Corporation Limited, as well as representatives from banks that will provide financing for the project.

Chinese companies have been following the project for three years, in hopes of making it the third milestone project for the internationalization of China’s high-speed rail, following the Moscow–Kazan and Jakarta–Bandung high-speed rails.

Japanese companies are the biggest rival of the Chinese delegation. However, the Japanese government is unable to invest a large sum of money in the project, so Japanese companies have to look elsewhere for financing, according to an insider who spoke to Caixin on the condition of anonymity. An official from the Chinese delegation told Caixin that this is China’s biggest advantage.

Another advantage lies in the construction cost, which is about half that of the Shinkansen high-speed rail network in Japan. According to Lee Der Horng, a professor in the Department of Civil and Environmental Engineering at the National University of Singapore, Chinese companies estimate that construction can be completed within two years, much faster than the Japanese side has promised.

In addition, prior experience working with Malaysia on the nation’s regular rail system and light rail transit is another factor that gives the Chinese delegation an advantage. Chinese companies have supplied 75 to 80 percent of the locomotives, coaches and related equipment to Malaysia, according to Xinhua News Agency.

The number of citizens with Chinese ancestry and the influence of Chinese culture in the two countries will also influence the project. The governments of both Singapore and Malaysia have said they will take culture and general philosophy into account when making their selection for the project.

No matter who wins, the railway may have a difficult time turning a profit, because the population of the two cities is far less than that along the Tokyo–Osaka rail, according to the Japanese insider.

The 350-kilometer Kuala Lumpur–Singapore high-speed rail project was announced by Malaysian Prime Minister Najib in September 2010. Besides China, the East Japan Railway Company, Alstom and Siemens have all shown interest in competing for the project.