Mexico on Thursday abruptly withdrew a multibillion-dollar deal with a Chinese-led consortium to build the country’s first bullet train after concerns were raised about the bidding process.
The government had awarded the US$3.75 billion contract to the China Railway Construction Corp and four Mexican partners on Monday after the group had been the only one to submit a bid.
However, Mexican President Enrique Pena Nieto scrapped the deal to avoid “any doubts about the legitimacy and transparency” of the bidding process, Mexican Transport Minister Gerardo Ruiz Esparza said.
Ruiz Esparza told the Televisa network that Pena Nieto had taken the decision “moments ago” and that the bidding would start over.
The transport ministry said in a statement that the president made the decision “due to the doubts and concerns that have emerged in public opinion.”
More time will be allotted to encourage more train-makers to make proposals, the ministry said.
The Chinese-Mexican consortium faced no opposition when it was picked on Monday to build the 210km high-speed rail between Mexico City and the central manufacturing hub of Queretaro.
Pena Nieto surprisingly revoked the deal three days before flying to Beijing for an APEC summit and a two-day state visit in his latest effort to forge closer ties with China.
The high-speed rail project is part of Pena Nieto’s plan to bring back passenger trains to Latin America’s second-biggest economy.
However, only one group submitted a proposal by the Oct. 15 deadline.
The transport ministry said at the time that 16 companies decided against entering the contest, including industry giants Mitsubishi of Japan, Alstom of France, Bombardier of Canada and Siemens of Germany.
The ministry did not explain why the companies had shied away from making bids.
When announcing the winner on Monday, Ruiz Esparza said it was not unusual for just one group to bid for a high-speed train project, noting that on average, only two companies make bids for such projects worldwide.
Prior to scrapping the deal, the government had expected construction to start next month and operations to begin in 2017.
The project aims to carry 23,000 passengers per day at speeds of up to 300kph, reducing the commute between Mexico City and Queretaro from two-and-a-half hours to 58 minutes. It would make Mexico the first Latin American nation to have a bullet train.
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