The Small Medium Enterprise Development Bank Malaysia (SME Bank), an agency under the Entrepreneur Development Ministry has signed a tripartite memorandum of understanding (MoU) with the Malaysia Rail Link Sdn Bhd (MRL) and China Communications Construction (ECRL) Sdn Bhd (CCC-ECRL) to facilitate financial solutions to Malaysian subcontractors in the East Coast Rail Link (ECRL project).
Entrepreneur Development Ministry secretary-general Datuk Wan Suraya Wan Mohd Radzi said under the MoU, SME Bank has allocated RM1 billion in financing for appointed sub-contractors of the ECRL project. “The facility is in the form of Term and Revolving financing and is capped at RM50 million for each applicant excluding Bank Guarantees”. “However, if the amount required is above RM50 million, it will be considered on a case-to-case basis,” she said. She added that the financing tenure would vary in accordance with the contract period as stipulated in the Letter of Award. “This facility can be used for contract financing, working capital and purchase of equipment.
Currently, the ECRL civil works packaged to Malaysian subcontractors is ongoing in stages for tunnels and temporary works within the Dungun-Mentakab section. Finance Minister Lim Guan Eng who was also present at the MoU signing added that the collaboration serves as an endorsement to the ECRL project under the improved deal between Malaysian and China He added that ECRL will also provide a platform for knowledge sharing and technology transfer. “This is crucial as Malaysian companies, especially the smaller ones, must urgently raise their competitiveness and improve their work and service quality. “This is where SME Bank can play an important role,” he said.
— Malay Mail