The Small Medium Enterprise Development Bank Malaysia (SME Bank) announced on November 18 that it will provide one billion ringgit (US$240 million) for local contractors involved in the East Coast Rail Link (ECRL), a major infrastructure project with Chinese backing.

The development finance institution, which operates under the Malaysia Ministry of Entrepreneur Development, announced the initiative following the signing of a memorandum of understanding (MoU) with the project company Malaysia Rail Link (MRL) and main contractor China Communications Construction Company Ltd. (CCCC).

The MoU is aimed at facilitating the provision of finance to Malaysian subcontractors.

Attending the ceremony was Malaysian Finance Minister Lim Guan Eng, who highlighted the fact that the construction of the ECRL will provide new jobs for local vendors and contractors.

Chinese Ambassador to Malaysia Bai Tian said the announcement of the collaboration was timely and would provide strong support for locals bidding for civil works.

CCCC Malaysia Managing Director Bai Yinzhan said that at least 40 percent of the civil works will be done by local contractors.

The ECRL will be an electric railway line running 640 kilometres across the country, carrying passengers at high speed, plus freight cargo. Construction is expected to be completed by 2026.