Malaysian Rail Link: RM2.66b worth of ECRL projects given to Bumiputera companies

KUALA LUMPUR, Jan 4 — The East Coast Rail Link (ECRL) clarified that as of November 30 last year, a total of RM13.64 billion in contract value, which exceeded the target of RM10.8 billion, had been awarded to local companies consisting of contractors, consultants and local suppliers.

Malaysia Rail Link Sdn Bhd (MRL), the project owner of the ECRL, said the amount includes RM1.20 billion for project’s contract works in Kelantan, RM6.18 billion in Terengganu, RM5.62 billion in Pahang and RM0.64 billion in Selangor, involving a total of 2,801 local companies.

“From this amount, we would like to clarify that the contract value that has been awarded to Bumiputera contractors, consultants and suppliers as of November 30 last year was RM2.66 billion or 76.07 per cent of the target of RM3.50 billion.

“Of the total value of RM2.66 billion, RM1.69 billion was awarded to Bumiputera contractor companies, RM0.28 billion to Bumiputera consulting companies and RM0.69 billion to Bumiputera suppliers,” MRL said in a statement issued today.

MRL issued the statement to clear the air over earlier claims by Persatuan Kontraktor Melayu Malaysia (PKMM) in a Malay-language daily that the contract value figures for the ECRL project’s civil works awarded to Bumiputera contractors, consultants and suppliers were doubtful.

MRL added in the statement that the total of RM1.69 billion that has been awarded to the Bumiputera contractor companies involved 172 contract packages (28 in Kelantan, 79 in Terengganu, 50 in Pahang and 15 in Selangor) from 129 Bumiputera contractor companies for ECRL’s project works in Kelantan, Terengganu, Pahang and Selangor.

It said this includes ground works (at-grade), bridge works and station construction.

The statement also added that MRL and China Communications Construction Company Ltd (CCCC) have from 2017 to present cooperated with the respective state governments, namely those from Kelantan, Terengganu, Pahang and Selangor, to further enhance the involvement of Bumiputera contractors in the ECRL project.

“The state governments involved have each established a special coordinating committee and have also appointed state government-owned companies specifically for the purpose of recommending Bumiputera contractors to go through the pre-qualification (Pre-Q) process.

“Among the requirements that have been set in the Pre-Q is that the company needs to have relevant certificates, including a certificate confirming Bumiputera status to be eligible to be shortlisted.

“Next, Bumiputera contractors who have been shortlisted will be called by the CCCC for tender participation for the relevant work scopes.

“Reporting on the Involvement of local companies in the ECRL project is made monthly by the CCCC,” said MRL in the statement, adding that MRL will also brief and update the details on the involvement of the companies to each state government involved from time-to-time.

In addition, MRL also holds several engagement sessions with stakeholders in order to provide another platform for Bumiputera contractors in the relevant states to have the opportunity to participate in the construction of the ECRL project.

“MRL is also aware of issues related to commercial factors and other constraints in the determination of the ECRL project tender offer and we are always ready to help resolve issues raised to the project owner by interested parties.

“We would like to emphasise that efforts to empower Bumiputera involvement in the ECRL project is always a priority, even though this is not stated in the engineering, procurement, construction and commissioning (EPCC) contract agreement, which only requires the involvement of local companies,” read the statement.

Recently, MRL said an additional initiative being taken by the CCCC is collaboration with the state government involved for category G1 and G2 Bumiputera contractors in the appropriate scope of work.

It said the CCCC is in the process of shortlisting the G1 and G2 Bumiputera contractor companies that have been recommended by the state government to call for a tender participation in the near future.

“MRL also expects the contract value for Bumiputera companies to continue to increase through “dual gauge” track construction works from Port Klang ECRL station (Jalan Kastam) to Westports and Northport wharves,” read the statement.

Earlier, Utusan Malaysia quoted PKMM vice-president Abd Gapar Lambak as urging MRL to disclose a detailed account of the value of the contract to the respective Bumiputera companies.

He said MRL needs to provide details about the company name, grade and registered address of the Bumiputera companies involved to avoid allegations of being marginalised in the on-going ECRL project.

Last December 11, Transport Minister Anthony Loke was reported to have said in Gebeng, Pahang that as much as RM2.59 billion or 74 per cent of the RM3.5 billion target for ECRL project’s civil works had been given to Bumiputera contractors, consultants and suppliers.

In the past, it was stipulated that CCCC will appoint local sub-contractors and suppliers for at least 30 per cent of the civil works involving the ECRL project, excluding tunnel works.

However, the percentage has since been increased to 40 per cent as a result of the renegotiation of the EPCC contract between the Malaysian and Chinese governments in its supplementary agreement contract in 2019.

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