Chinese firm files for compensation over suspended Mexico rail project

The China Railway Construction Corporation (CRCC) has filed for compensation following the suspension of a high-speed rail project it won in a bidding in Mexico, Mexican media reported on Monday.

The firm submitted the relevant paperwork "at the end of January," confirmed Pablo Suarez Coello, director-general of rail transport at the Communications and Transportation Ministry, according to Mexico's state news agency Notimex.

Suarez made the remarks when interviewed by reporters at the inauguration of Expo-Rail 2015, being held in the Caribbean resort of Cancun by the Mexican Association of Railroads.

Mexican officials have yet to negotiate such compensation with the Chinese firm, said Suarez.

The "indefinite suspension" of the rail project was announced on Jan. 31, as part of a package of spending cuts due to a reduced national budget.

The announcement marked another dramatic twist of the event since bidding process started for the Mexican high-speed rail project, which is expected to cost 3.75 billion U.S. dollars.

CRCC led a consortium of some five firms that entered the only bid to win the project back in November, but the Mexican government later abruptly annulled the result citing domestic reasons.