I agree with Nuraina Samad we don't need that goddamn bridge here.With that kind of money Ali Rustam should consider building a tunnel(metaphorically) from Malacca direct to Singapore where the benefits could be far greater than building a bridge to Sumatra.
Do you build a bridge just for prestige or build it for economic reasons?
Lesson should be learned from the 'Channel Tunnel" which linked Britain with mainland Europe.This tunnel makes far greater sense than that of Ali Rustam's bridge because it links highly economically developed areas in Europe.Yet, it has not served the purpose it was built for. It was bogged down with monumental problems during construction and after completion.Construction started in 1988 that incurred a mind-boggling cost overrun of 80%.
Since its opening it has been operating at a loss.In 1995, it has to stop its loan repayment to avoid bankruptcy.The debts have to be restructured and the French and British government extended its operating concession by 34 years, which will only end in 2086.
A cost benefit analysis indicated that it has no wider economic impact on Britain and that the British economy would have been better off if the tunnel had not been built.It reported its first annual net profit of $1.57 million only in 2007.
You can see what a risky venture this kind of project is.I have to agree with the DAP member that the project should be scrapped.
Ali Rustam should come down to earth and be realistic about the whole idea.Just because some businessmen proposed and got the backing of a bank from China to finance the project it doesn't mean the project is viable. He must not forget that loans have to be paid back.Things are not as simple as it looks from a layman's point of view.
I have done business with China before and they are not the easiest people to deal with.Worse, if you take loans from any country, China included, they will be many strings attached.
Due to huge nature of the project and substantial exposure to the bank, in all probably, the bank would ask for the state government to guarantee the loan and a state in Malaysia can only guarantee foreign loan with approval of the Federal government.Giving such approval means the Federal government would eventually become a party to that guarantee and in the even of a default it would eventually involve the Federal paying up the debt.
This is a sovereign credit risk that Malaysia can do without. Besides, the loan, China being the main financier would insist that majority of the expertise, labour and materials would have to come from China. How would Malaysia benefit from such project when most of the money would eventually return to China?
The other aspect that needs to be looked into this egoistic project is safety.The Malacca Straits is the busiest shipping lane in the world.Accident, can and do occur no matter what safety precautions one puts in.
I lived in Singapore in the eighties, two things came to my mind, things that you don't expect to happen in Singapore, but it happened.The Sentosa cable car tragedy and the collapse of the New World Hotel.Who would believe that a ship passing under the cable car can pull the whole cable system down, killing a number of people.The same with the collapse of the New World, with the stringent building codes in Singapore, no building is supposed to collapse, but it did.
The Channel Tunnel,with all it safety precautions, had three serious incident of fires and one was bad enough to close the tunnel for six months.
Sure, accident should not be a criteria in assessing the viability of a normal project but than this is not a normal project, it has high risk elements to be considered, economically,physically and geographically.The Malacca Strait's risk factor of maritime collision is pretty high and the Indonesian sides are prone to earthquakes and tremors.
What economic benefits would Malaysia get if the bridge were to be built? Sumatra has very low per capita income and it is not likely that hordes of Indonesians with bulging wallets would be coming over here to spend their hard-earned money, it would be the other way round, Malaysians would be going over there for holidays. It is also a low economic output area. With the exception of oil palm and crude oil which are shipped directly from the country, Sumatra has little to offer.
If Ali thinks of economic spin-offs that will benefit Malacca in particular and Malaysia in general or a booming two-way trade, he can forget it.There wouldn't be any.At least none that I can think of.
If he thinks the volume of traffic can make the project viable than that would even be a bigger risk.Shouldn't Indonesia be asked to pay for half of the cost of the bridge?
An efficient and fast ferry service between the two countries would be a cheaper alternative.
With the bridge in place, the only possible scenario that I can see is more migrant workers and illegal immigrants coming over to Malaysia using the bridge.