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Now or never for Labuan: Ex-CM
Published on: Monday, January 06, 2014

Labuan: Former Chief Minister Tan Sri Harris Salleh said he and his Chinese partner (Shandong Laigang) took a "big risk" in offering to undertake and finance the economic development of Labuan which included a bridge and entreport estimated to cost RM6 billion and development of commercial and residential properties on submerged land.

Despite the risks we have offered to undertake the projects on land swap basis because this is the reality as it would not make sense to build the bridge on cash investment basis as it would take 90 years to recover the cost of the bridge spanning 13km on Labuan side and 3.5km on Sabah side.

"I wanted to push the project because my observation is that Labuan has not been given its proper place in Malaysia," he said.

He said the Iskandar concept in Johore should have been introduced to Labuan many years ago. Labuan has only been making some progress in recent years - there had been no shortage of announcement and signing ceremonies. "But sadly, nothing much happened on the ground," said Harris when interviewed about his project.

Harris believed that the proposed economic development of Labuan will see the island Federal Territory adequately prepared to move forward and grab the new opportunities expected to emerge from oil and gas activities in the Spratlys which is about 150km from Labuan and said to have more oil and gas reserves than current deposits in the Middle East.

On why he (Harris) has now chosen to vigourously pursue the economic development of Labuan after keeping a low-profile for years, Harris said: "It is the right time and Labuan is at the right place. Besides the rich oil and gas fields of Spratlys, the Chinese government was committed to invest RM500 billion in helping developing countries. This had resulted in Chinese Government-linked companies to look for mega infrastructural projects in development countries."

He said some good news that recently surfaced in Labuan's favour is that a Chinese oil company already signed an agreement with Petronas to supply Chinese operations at Spratlys with support vessels.

If this news is true, China would use Labuan as a base, and Labuan stands to receive an annual payment of US$21 billion for vessels entering or passing the territory, " said Harris.

He felt it would be a good reciprocal gesture for Malaysia to consider the partnership of a local company with a China-based for the economic development of Labuan.

Harris also reminded that unnecessary delay in decision making on the Malaysian side would prove costly as Palawan province in the Philippines remains a contender for the base and Palawan is also about the same distance away from Labuan."

Harris said there was no question that the Chinese had the funds and structures to finance and build the bridge.

He said the proposed bridge had been the talk for about a decade and even announced by the late Raja of Perlis when he was the Yang Dipertuan Agong and mentioned in the 13th General Elections.

The announcement repeated were read as the Federal Government was simply waiting for available funds for the project.

"But now it seems apparent there is no urgency to build the bridge because it is neither a priority nor an economic project," added Harris.

He said after receiving approaches from the Chinese companies to undertake the bridge project he had discussion with the Chairman of Labuan Corporation (Rozman Isli) to whom the final proposal was submitted 18 months ago after negotiations with the FT Minister and other parties. The proposal had been submitted for final government approval and "construction would proceed as soon as approval is given," said Harris.

Harris said similarly entreport would be completed on reclaimed land within a few years after final approval.

He said the integrated port would cater for the future of Labuan and could handle cargo ships of 400,000 tons bringing 80,000 containers. The location chosen for the best port was also the best side in Labuan.

It was large and deep whereas the propsal to build the port at Rancha was suitable only for short term.

With the completion of the residential properties the reclaimed land the Federal Government could actively offer its second home programme to retirees with the offer of payment status similar to what the government in Indonesia, Thailand and Philipines were doing, "the retirees could either take residence in Labuan or Langkawi.

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