While Mahathir has effectively dismantled Najib’s national rail design, much of the former prime minister’s vision for new urban transit capacity remains intact in the Klang Valley, the fast-growing Kuala Lumpur region, which accounts for nearly 40 percent of Malaysia’s economic output.

During its nearly eight-year existence, the SPAD dived into a $29 billion program meant to ease traffic congestion, curtail air pollution, elevate Malaysia’s international prestige, and build its national economy by essentially doubling metro rail transit capacity in the capital city region of 7.3 million residents.

Among the SPAD’s early achievements was the LRT Kelana Jaya line, one of the longest automated driverless metro lines in the world. At regular five-minute intervals, the LRT’s bright white cars slip past the SPAD’s office alongside KL Sentral, the capital’s main train station. The commission supervised the $1 billion expansion of the line to 46 kilometers (29 miles) and 37 stations, completing the work in 2016 on time and within budget. A new and third 37-kilometer (23-mile), 21-station, $4 billion LRT3 line is under construction.

Blocks away, the trains of the 31-station MRT Line 1 stop in a deep underground station. The $5 billion, 51-kilometer (32-mile) MRT Line 1 is the world’s second-longest driverless metro line. MRT Line 1 opened in 2017 after six years of design and construction that was on time and within the budgeted $100 million per kilometer.

The figures compare favorably against the inordinate delays and exorbitant costs of rail transit development in the United States. Authorities in New England, for example, have been working for more than 20 years to add 7 kilometers (4 miles) to a light rail line from Boston to reach two suburbs. The current estimated price: $2.3 billion, or more than $300 million per kilometer.

Past performance, though, is no guarantee of future success. Key to Mahathir’s May 9 victory were three issues wound around Najib’s rail projects.

One concern played on the long-standing tensions between the Malay and Chinese communities. Mahathir charged during the campaign that former Prime Minister Najib was inviting China to expand its sphere of influence in Malaysia by recruiting Chinese companies to finance and build big portions of the rail network, and the mega ports, manufacturing centers and real-estate developments it would serve.

The second issue was their cost. That issue lies at the center of the Mahathir administration’s concerns about the rapidly escalating price that Malaysia was about to pay for the 37-kilometer LRT3 metro line under construction in Kuala Lumpur. Initially, Prasarana Malaysia, the government-owned transit company and LRT3 developer, said the line would cost $2.45 billion. In March, though, Prasarana sought $5.4 billion more to finish the project.

After the election, Prime Minister Mahathir assigned the Ministry of Finance, which oversees Prasarana, to review the LRT3 budget and contracts. Finance Minister Lim Guan Eng told a news conference in July that he was appalled by what his investigators found. His office negotiated new contracts that reduced the number of stations, cut the number of trains and cars, eliminated a 2-kilometer tunnel and would finish the line for $4 billion, a savings of nearly 50 percent.

“Why did they allow the project delivery partner to charge such high costs?” Lim told a news conference. “If there was no change in government, this money would be paid by our children. They were stealing our children’s future.”

Japan was competing in this advertisement to build the high-speed rail line between Kuala Lumpur and Singapore. Prime Minister Mahathir suspended work on the project soon after he was elected in May. Image by Keith Schneider for Mongabay.

And the third conflict was how rail development converged with corruption around huge real-estate projects close to new transit stops. The largest investigation focuses on 1Malaysia Development Berhad (1MDB), a national infrastructure development fund accused of corruption so deep that $4.5 billion cannot be accounted for. Najib is accused of personally stealing $731 million, a charge he denies.

1MDB gained control of and sold big parcels of public land in Kuala Lumpur for two master planned developments served by new transit stops. One of those projects, the $10 billion, 28-hectare (70-acre) Tun Razak Exchange (TRX), is proceeding to completion in the early 2020s as Malaysia’s new financial center. Land values at the exchange were significantly enhanced by a new station on the MRT3 line that opened last year to serve the development. Finance Minister Lim reported in June that $750 million was “misappropriated” by 1MDB from the Tun Razak Exchange. The Mahathir administration, he said, had nevertheless decided to invest almost $700 million more to complete the project.

“The Malaysian cabinet has decided to support the TRX project to recoup all misappropriated funds, repay all borrowings, recover all funding investments and opportunity costs as well as potentially achieve a small surplus return,” Lim said in a statement.

Malaysian investigators also are looking closely at potential criminal activity connected to the transfer of 16 hectares (40 acres) of government-owned land in Kuala Lumpur close to the junction of two metro lines.

The land, valued at $50 million, is the site of the Kuala Lumpur Vertical City, one of the many big mixed-use real estate projects in Malaysia’s capital. It was transferred in 2015 at no cost from Felda Investment Corporation, a unit of the government-owned Federal Land Development Authority, to Synergy Promenade Sdn Bhd (SPSB), a private developer.

The government announced last year that it had opened an investigation for “criminal breach of trust” that targeted members of the 2014 Felda Investment Corporation board, including its chairman Tan Sri Isa Samad, who resigned in June 2017. Samad also was the chairman of the SPAD board before he was forced by Mahathir to resign in May. There have been no prosecutions in the case.

Mohammad Azharuddin Mat Sah, SPAD’s chief executive, before the agency was disbanded by Prime Minister Mahathir. Image by Keith Schneider for Mongabay.

Storm of Change Not Anticipated

Weeks before the May election, none of the approaching disruption was apparent in the SPAD office. During an interview in April, the commission’s chief executive, Mohammad Azharuddin Mat Sah, displayed the characteristic confidence of a top government manager doing his job well.

Azharuddin said that in 2010, the year the SPAD was formed, just 11 percent of the trips in and around the Kuala Lumpur metropolitan region were made on public transit. The goal, which included one of the new lines cancelled by Mahathir, was “expected to increase the bus and train travel’s market share to 60 to 70 percent,” he said.

The SPAD went to work on a master plan to make rail transit in Kuala Lumpur efficient, affordable, even chic. Design and construction contracts called for spending an estimated $36 billion to add 144 new stations and 269 more kilometers (167 miles) of track to the existing rail network. Essentially, the SPAD set out to double the size of the city’s transit system, and more than double ridership to 2 million a day.

The majority of the proposed budget was devoted to building two roughly 50-kilometer (31-mile) rapid transit lines that crisscrossed the city, and a third 40-kilometer line that ringed the city and intersected with almost all of the existing and planned rail lines. “The government saw that we needed people to move seamlessly. Mobility was key,” Azharuddin said. “We realized we had to move people from just being in cars and towards mass transit. It is very clear. If you see Kuala Lumpur, it’s a thriving city. We have ambitions to be a global city. A top 20 city. You need to have not just cars but also a great public transport network do that.”

The first of those mass transit lines, the $5 billion, 31-station, driverless MRT Line 1, opened last year. A second of similar size and cost is under construction and due to be finished in three years. The third MRT line was just cancelled but could be brought back from the dead because of how much planning had already been undertaken by the SPAD.

The relative speed of Kuala Lumpur’s rail development is impressive. SPAD responded to public anxiety in 2011 about dust, disruption, and home demolition by explaining that track alignments would follow existing road corridors.

Moderate traffic congestion in metro Kuala Lumpur, at least compared to other big Asian cities, is evidence that public transport is helping keep cars off the streets and highways. The SPAD’s research indicates that its nearly 700,000 daily rail riders pull at least 200,000 cars a day off Kuala Lumpur’s roads and highways.

A study published last year in the Journal of Transportation and Health estimated that if MRT lines 1 and 2 reach their full capacity of more than 1 million daily riders, 228,000 more vehicles would be left at home, and 242,000 metric tons of carbon dioxide and nearly 68,000 grams of dangerous particulates would not be turned loose into the atmosphere. How long that will take is not known. The MRT1 transports 150,000 passengers a day now, said Azharuddin. That’s ahead of the agency’s projections. Before it was disbanded SPAD recorded a 7.5% increase in the average daily rail ridership from 2016 to 2017, which was principally due to opening MRT1, he said.

The improvements to the transit system have even started winning over upper-class commuters, who previously “didn’t want to be smashed up in a small car with a whole lot of blue-collar workers,” said Christine Yeap, the communications director for the Kuala Lumpur office of the Mulia Group, a Jakarta-based real-estate developer. “The MRT came along and it takes you through some of the most expensive parts of Kuala Lumpur. The people there are riding it now. Then the young ones who come back from studying in the U.K. or the U.S., they decide, ‘OK, I’m not driving, I’m taking the train.’ So I see the opportunity now.”

Evening rush hour in KL Sentral train station in Kuala Lumpur. Image by Keith Schneider for Mongabay.

Najib’s expensive transit vision for Kuala Lumpur was predicated on assuring drivers that using the train was good for them, and for the country. What has emerged since the 1MDB scandal first became public three years ago, and more clearly since the May 9 election, is a matrix of deceit.

Important decisions about selling big parcels of government-owned land for development may have been influenced by insider knowledge of planned rail line routes, and the location of new train stations. Similarly, choices about routes and train stations may have been influenced by the proximity to big parcels of government-owned land eligible for major real estate development.

The extent of corruption appears to have been deep enough to make it difficult to understand where projects designed for the public good ended, and where the quest for illicit gain began. Evidence yet to be introduced in Malaysia’s criminal courts will presumably clarify how much of Malaysia’s new rail transit was truly meant to improve the quality of life, and how much was influenced by insider fraud and abuse.

This is the fourth in a six-article series on infrastructure in Peninsular Malaysia. Read Article 1, Article 2 and Article 3 here.

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Article published by Isabel Esterman
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