Is the Melaka Gateway Huangjing Port project doomed?

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Huangjing Port is “China’s military strategy for acquiring and maintaining the Malacca Strait Means of influence”.

https://inf.news/en/economy/71b836bd5fd7f219c67e42d94aaee01c.html

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Kota Melaka MP Khoo Poay Tiong has questioned the validity and the abrupt revival of the RM 42 billion Malacca Gateway development project that was terminated in 2020.

He said the concessionaire was cancelled by the state government when the extension period given to the developer to complete the project had expired.

Khoo, however, told The Malaysian Insight the project was given back to the developer in March this year despite not having an environmental impact assessment (EIA) report.

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The Edge

Melaka Gateway dispute: Apex court hearing adjourned as parties pursue out-of-court settlement

Shazni Ong / theedgemarkets.com

February 10, 2022 | Updated 9 months ago

KUALA LUMPUR (Feb 10): The Federal Court had on Wednesday (Feb 9) adjourned its hearing of the Melaka Gateway mixed development dispute involving its developer KAJ Development Sdn Bhd and the Melaka state government as both parties are pursuing an out-of-court settlement following a disagreement on the termination of the state government’s agreement with KAJ for the project.

A three-member Federal Court bench had on Wednesday granted KAJ an adjournment till May 19, 2022 to hear the company’s application for permission to appeal against the Court of Appeal’s decision in 2021 to reject its application for permission to initiate a judicial review to challenge the Melaka state government’s move to terminate its agreement with KAJ involving land reclamation with the Straits of Malacca for the Melaka Gateway project.

https://www.edgeprop.my//content/1901885/melaka-gateway-dispute-apex-court-hearing-adjourned-parties-pursue-out-court-settlement

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The fate of Malacca Royal Port is different. This huge port will cost 43 billion ringgits (US$10.5 billion), covering four islands in the Strait of Malacca. It is planned to build the largest private terminal in Southeast Asia that can berth four cruise ships at the same time, a cargo terminal, and a maritime high-tech An industrial park and a free trade zone. The Malacca State Government hopes that this project will revitalize the state’s economy, create 40,000 jobs, attract 2.5 million domestic and foreign tourists each year, and create 1.19 trillion ringgit in annual revenue.

Huangjing Port Melaka Gateway

The Huangjing Port project was launched in 2014 with a high profile, with the endorsement of the Najib government, and the property developer Leader of KAJ company, with support from Chinese state-owned enterprise China Power Construction and three Malaysian state government enterprises.

Considering its geographic location and scale, the outside world has analyzed from a strategic point of view, describing Huangjing Port as “China’s military strategy for acquiring and maintaining the Malacca Strait Means of influence”. Huangjing Port is located on the west coast of the Malay Peninsula. It can be connected to the East Coast Railway and Kuantan Port, both invested and constructed by China, to form a land bridge across Singapore. In addition, Huangjing Port enables China to monitor the Strait of Malacca, China 80 % Of energy demand passes through this water area.

However, despite its strategic importance and strong support from Malaysian and Chinese companies, the Office of the Chief Minister of Malacca announced it in November The cooperation with KAJ Company on the Huangjing Port project has ended on the grounds that KAJ Company failed to complete the reclamation project as scheduled.
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There are several reasons for the lack of interest in the Royal Capital project among the top Malaysian political circles. First of all, unlike Kuantan Port, Royal Port is not one of the country’s seven federal ports. Three of the seven federal ports are located on the west coast of the Malay Peninsula. They belong to the same area and compete with Royal Port.

In addition, an in-depth investigation of the port industry by the World Bank pointed out that Malaysia should make full use of existing port facilities Distributed to multiple ports. Through good planning, improved logistics connectivity and prudent expansion, the existing major port network is sufficient to meet the country’s anticipated demand until 2040. The construction of more ports will erode the cargo volume of existing ports and is not necessary.

The mistake of the Huangjinggang project lies in the fact that the consortium behind it did not obtain sufficient support from the highest levels of Malaysian political and business circles. It has won the support of some local political elites and the Malacca state government, but its role at the federal government level is limited. The development of Huangjing Port will reduce the cargo throughput of the existing ports. Those business elites who have real interests in the existing ports are mostly opposed to Huangjing Port.

Conclusion

Through the examples of Kuantan Port and Huangjing Port, we can see that local factors play an important role in the success or failure of the One Belt One Road project. China’s funding is important, but the ability to navigate the local complex political environment is also extremely critical.

https://inf.news/en/economy/71b836bd5fd7f219c67e42d94aaee01c.html

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The following video by Real China paints a rosy picture of the Huangjing Melaka Gateway project.

While Real China claims to be neutral, it is clear that it is really a mouthpiece for China.

It had been cancelled and the case was sent to the Federal Court. However, the project was given back to the developer in March this year despite not having an environmental impact assessment (EIA) report.

There are new objections raised.

Given the above, the USA and Singapore have nothing to fear.

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