Kuala Lumpur seizes Beijing cash, threatening China's Belt and Road plan
CHINA's troubled Malaysian Belt and Road projects may have been derailed again after Malaysian authorities seized US$241
CHINA's troubled Malaysian Belt and Road projects may have been derailed again after Malaysian authorities seized US$241.43 million held by China Petroleum Pipeline Engineering Corp (CPP), a Chinese state-owned company, reports Caixin.
The on-again off-again Belt and Road projects were taken on by the previous administration, but rejected by newly elected Prime Minister Mahathir Mohamad, aged 95, as being too financially burdensome and requiring the presence of 'too many warships'.
Beijing persuaded Kuala Lumpur to resume the $10.7 billion Belt and Road projects last April. Malaysia reportedly backed down when with faced $5.3 billion 'termination costs' contained in initial agreement, according to London's Financial Times.
In an unprecedented move in Malaysian banking, the Pakatan Harapan (PH) government ordered HSBC, early in July to transfer the funds held in CPP?s account in Malaysia to Suria Strategic Resources, which is wholly owned by the Malaysian Ministry of Finance.
In response to queries from Singapore's Straits Times, CPP, which was the lead contractor for the pipeline projects awarded in November 2016 by the previous government of Prime Minister Najib Razak, confirmed that the funds were transferred out.
'CPP firmly abides with the laws of Malaysia and is perplexed by the unilateral transfer of monies without notifying CPP,' said the company, a unit of China's state-owned oil and gas giant China National Petroleum Corp.