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GEORGE TOWN: The Penang Light Rail Transit (LRT) project will continue regardless of any changes in the government, says Economy Minister Rafizi Ramli.

Rafizi said he is confident in the project’s progress, adding that the current government is likely to remain in power long enough to oversee its implementation.

“Even if there is a change of administration in the future, the new government will be obliged to continue the LRT project or risk legal action,” he said.

He explained that canceling a project becomes virtually impossible once contracts have been awarded as this would expose the government to significant damages claims.

Infrastructure projects such as the LRT go through several phases: policy approval, budget confirmation, tendering and contract award.

“Once a contract is awarded, the government is legally bound by its obligations to private parties,” he added.

He noted that cancellation is only possible at the initial stages, before tenders are issued and contracts are awarded. Once contracts are signed and work begins, any decision to cancel would result in significant compensation for the contractors.

Rafizi also said that if there is a change of government, the main risks would be higher costs and delays in implementation, and not the cancellation of projects.

He was responding to a public question at the “Madani Mendengar” event at the Setia Spice Convention Centre.

Approximately 1,000 people from state and federal government agencies, non-governmental organizations and the public attended the event.

Rafizi also referred to the East Coast Rail Link (ECRL) project, which he criticized when he was in opposition.

He opposed it at the time because the cost was RM70 billion, which was considered uneconomical. However, once the project started and land was acquired, it could not be canceled.

He suggested that if contract terms are unfavorable to the public, the government could try to renegotiate, for example by reducing costs, although this would be dependent on existing agreements.

Rafizi also discussed the role of Environmental, Social and Governance (ESG) in the implementation of infrastructure projects.

He said an emphasis on green components would contribute significantly to the economic evaluation of projects like the LRT.

“The ESG components, especially the green element, play an important role. That is why many parties use the terms ESG and green interchangeably in the context of the economy,” he says.

The program is expected to continue at 2:30 pm in the presence of Chief Minister Chow Kon Yeow.