Tuesday, 15 May 2012

The rejected "Killer" Kuokuang petrochemical investment project transferred to Johore?

MAY 15 — The rejected Kuokuang petrochemical investment project will be transferred to Pengerang, Johor. It is another controversial project after the Lynas rare earth refinery plant project in Kuantan. It is believed to become an election issue, too.

Malaysia is an oil-producing country and oil has been listed as one of the national key economic sectors. Therefore, it is a logical move to enter the refining and petrochemical industry, which is believed to bring huge economic benefits.

However, does it mean that the people must pay the costs of health and environment to develop the petrochemical industry and gain economic wealth? Do all countries in the middle-income trap have to make sacrifices and bring in high-pollution industries?

Like the Lynas rare earth refinery plant, people are having the same doubts over the RM36 billion petrochemical investment project. Why are we welcoming something that has been rejected by others?

Kuokuang Petrochemical Technology Co proposed a huge petrochemical investment project in Taiwan in 2005, to build petrochemical plants in Yunlin. However, the location changed to the coast of central Zhanghua county in 2008 after failing the environment assessment. On April 22, 2011, President Ma Ying-jeou announced his withdrawal of support for the project.

The Kuokuang petrochemical investment was accused of high water consumption, consuming about 400,000 tons per day, which would drain the largest wetlands of Taiwan and threaten food safety. In addition, it was estimated that 339 to 565 people would die of cardiovascular diseases and lung cancer, while patients of respiratory diseases would also increase due to the PM2.5 pollutants released into the air.

The project could create 20,000 jobs, but it was estimated to cost more than NT$100 billion in social cost yearly.

Eventually, political leaders listened to public opinion and shelved the project under the strong opposition from the people, as well as environmental and ecological protection organisations.

Deputy Minister of International Trade and Industry Datuk Mukhriz Mahathir has expressed interest in the project since April last year after the project was shelved in Taiwan. Taiwan Economic Minister Shi Yanxiang also confirmed that Kuokuang Petrochemical Technology Co does have contact with Malaysia.
It is believed that the two parties have negotiated details of the investment project since then, but the government did not consult the people and local experts. Like the Lynas rare earth refinery plant, it lacks transparency. It could lead to a strong rebound from civil society when the people are informed only after what is done cannot be undone.

The project had consulted public opinion and in-depth studies were conducted for six years in Taiwan. As for us, isn’t it too hasty to accept it without any prior studies conducted and even before the release of the environmental assessment report?

We feel baffled if it is true that Malaysia is offering 10 years’ tax-free concession as reported by the Taiwan media. Why should we treat such a high-risk investment so well? The Lynas rare earth plant enjoys 12 years’ tax-free concession while the Kuokuang petrochemical plants enjoy 10 years’ tax-free concession. It will not be worth it if the country has to spend huge sums of money to repair the environment in the future.
authorities do not seem to have learned a lesson from the Lynas rare earth refinery plant controversy.

The petrochemical plant issue is expected to continue fermenting and once the forces opposing the rare earth and petrochemical plants combine, it would spell trouble for the BN.

From a positive point of view, however, the rare earth plant and the petrochemical plant issues would raise civil awareness, which might help accelerate the country’s political transformation. — mysinchew.com

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