"I would not say that it is a bad investment, but time is not right.
"Our financial position does not allow the project at the moment – it is simply not economically justifiable," he said.
He noted that a number of other countries that had entered China for the development of mega projects, such as Pakistan and Sri Lanka, had been affected because they could not afford the projects.
Although he is positive about the decision to cancel the projects, Dr Hoo said that the GDP growth of the country will be affected by the move in the short term.
He predicts that Malaysia will enter a technical recession as a result of the expected negative growth in the current and next quarter.
"The cancellation of these projects will affect growth – in fact, growth has been affected since the ERCL was suspended and other mega projects were canceled in recent months," he said, noting that the construction sector was already suffering the consequences.
UOB The Malaysian economist Julia Goh does not expect a significant impact on the economy.
"Regarding the impact on the economy, the economic multiplier effect of ECRL is considered low, since the import content is high with a low use of domestic resources.
As such, the first-order effect on the total economy should not be significant, "she said.