China has been awarded a contract by the Indonesian government to build a railway across the country, fending off competition from Japan who were originally expected to win the bid.
After vying for months to build a high-speed railway through Indonesia only to be told by the government that they wanted a conventional railway instead, China and Japan once again locked horns and resubmitted bids for the new project.
According to AFP, Japan’s top government spokesman Yoshihide Suga said an Indonesian government envoy had informed him Tuesday that Tokyo’s bid had been rejected.
“Japan offered the best possible proposal,” he told reporters. “The envoy came here to explain that the Indonesian government has welcomed the Chinese proposal. “I can’t understand that at all. I frankly told the envoy that it was extremely regrettable.”
Reports indicate that China offered the Indonesians an incredibly sweet deal which some say is almost too good to be true. Under the Chinese proposal, the Indonesian government will not be required to take on any financial burden or make any guarantees for the project.
While Indonesia is yet to confirm the decision, State-Owned Enterprises Minister Rini Soemarno suggested that the Japanese had lost: “The government stressed that [the project] should not have government funding nor a guarantee – Japan’s proposal asked for a government guarantee.”
The news will come as a blow to the Japanese railway industry who looked sure bets to win the original contract for the high-speed line before the Chinese jumped in with a counter offer.
China has in recent years been looking to capitalize on their experience building the world’s largest high-speed rail network, hoping to win contracts for the construction of railway lines around the world. They’re expected to begin work on a line crossing Thailand later this year.