Wednesday, December 20, 2017

Stricken by plagues of Egypt?

From MM Online - DECEMBER 20:

On June 1, 1981, 100 Japanese Yen was equal to RM1.06.

By the time Mahathir left on 31 Oct 2003, 100 Japanese Yen had shot up almost 3 ½ fold to RM3.49.

Mahathir had borrowed heavily from Japan when he was in office but when the Yen started soaring, our loans which was in Yen also doubled and tripled since Mahathir and Daim did not have the foresight to hedge the exchange rates.

In fact like the ECRL, KLIA was funded 75per cent by a Japanese yen loan where many of the construction projects also went to Japanese companies.

Which is why it is so strange for Mahathir and gang to make a big issue of ECRL and its foreign funding.

At that time, if you had said Mahathir was selling Malaysia to Japan for all those loans to construct KLIA,, you be be beaten and sent in under ISA.

In any case, the appreciation of the Yen against the Ringgit got so bad that Malaysia stopped asking for Japanese loans in 1994 as its prime minister, Datuk Seri Dr Mahathir Mohamad complained the appreciation of the yen rapidly increased the Malaysian debt burden to Japan.

Malaysia ended up having to pay double or triple to clear our “soft” loans to Japan.

However in the face of the 1998 crisis, Mahathir had no choice but to resume asking Japan for loans.

In 1998, Dr Mahathir said Malaysia was seeking to borrow another US$2 billion from Japan, saying that he wanted the loans to be denominated in yen rather than dollars.

Dr Mahathir said then it was now a “good time to borrow yen” as the currency was depreciating, and that proceeds of any borrowing would be used in such areas as project finance and the environment.

However, it turned out that his prediction was not correct as the Yen had continue to appreciate another 30per cent from 150 yen to USD to 100 yen to the USD after that.

First thing first, before we get unnecessarily emotional, we should recall that Mahathir had always been BAD with money, projects and get-rich schemes, and usually with a strong stubborn self-willed autocrat, no one in his retinue of cronies and sycophants dared to tell him of his f**k ups.

Today let us talk about (1) the Maminco-Makuwasa scandal.

But why was that Maminco scheme called Maminco-Makusawa intead? What was the Makuwasa part of it.

Let us hear from WTF, which states:

Malaysia used to be the world’s leading tin producer accounting for 31% of the world’s output. It was a major contributor to the country’s economy providing employment for more than 40,000 people.

In 1985 the world tin market crashed with the price plunging by 50%. Many tin mines in Malaysia had to close as it was no longer economical to operate the tin mines.

One of the factors that contributed to the collapse of the tin market is the ill-fated attempt by the Malaysian government to corner the tin market and to prop up the tin price.

KT note: Guess who headed the Malaysian government in 1985?

If you say Najib, you have to try again as he was MB Pahang in 1985, wakakaka.

Continuing -
This is the Maminco scandal that is usually found at the top of the lists of scandals and bail-outs plaguing Malaysia since Mahathir became the PM.

It's those unfair plagues sent against me 

Ooops, the article spoilt my 'guessing game' wakakaka.

Continuing - This is probably because it was the earliest scandal occurring immediately after Mahathir became the PM in 1981. Although not the largest loss in terms of value, it still caused a loss estimated to be RM1.6 billion or more.

In this crooked scheme, a RM2 company Maminco Sdn. Bhd. was set up and was used to secretly buy tin future contracts and physical tin in order to push up prices on the London Metal Exchange.

To finance its covert activities, Maminco obtained financing from Bank Bumiputra – naturally. At one point, this RM2 company was borrowing astronomical amounts from the bank – as much as RM1.5 billion.

Initially, they succeeded in pushing up the tin price artifically. But the higher prices stimulated increased tin production and resulted in the US releasing its strategic stockpile. The tin price could not be maintained at the artificially high level for long and eventually it collapsed.

Undertaking this Maminco scheme is already bad enough. But instead of admitting their mistake, Mahathir and his merry band cooked up another scheme to hide the losses incurred by Maminco from the Malaysian public. Another RM2 company called Makuwasa was set up.

Read on and weep at Stage 2 of the Mahathir-Shindig.

f**k the crooked bridge - the money lost as asserted by Barry Wain would be more than enough to build the Kra Canal as a joint project with Thailand and fix the lil'
red dot up kaukau, wakakaka 

how much public money was WASTED just to satisfy his one-upmanship against Singapore? 

Continuing -
 The idea was new shares reserved for bumiputras allocated to EPF were diverted to Makuwasa at par value! 

Can you believe this? These cheaply acquired shares could then be sold for a profit at market price! Instant profits made by Makuwasa can then be used to cover the Maminco’s losses. 

Effectively, Makuwasa is used to raid the savings of Malaysians to help pay for Maminco’s losses!

In 1986 Mahathir publicly admitted that Makuwasa was created to recoup the government’s losses from the Maminco debacle and to repay its loans to Bank Bumiputra.

One of the biggest critics of Maminco at that time was Lim Kit Siang, who is the current buddy of Mahathir.

Let's read one of the lines above again, to wit, ... Maminco scandal that is usually found at the top of the lists of scandals and bail-outs plaguing Malaysia since Mahathir became the PM.

List of scandals ..... since Mahathir became the PM. It seems, if I may say so, the 'Pharaoh' has been a failure in his projects, plans and programs, perhaps stricken a la the 10 plagues of Egypt.  

Need we say more? Unfortunately yes, because some in Pakatan are asking for more of Mahathir, wakakaka.

In the next post I hope to discuss Perwaja scandal with you where that loss was estimated at (according to Barry Wain) RM15 Billion.

RM15 Billion? Aiyah, sap sap suoi saje in MalaysiaBolehdoh.


  1. Borrowing money heavily from foreign banks or foreign governments is never a wise action, as Greece, Portugal , Spain, Argentina, Brazil and , yes, Malaysia have found to their grief. So Mahathir's Look East heavy Yen borrowings at the time were unwise.

    But since Lim Sian See (and promoted by Ktemoc) have decided to make it a defense of Najib against current criticism of ECRL surrendering sovereignty to China, vs. Japan during Mahathir's is a huge difference.

    The heavy borrowing from Japanese institutions to finance KLIA were "arms length" commercial loans, with no accompanying influence or power to dictate the terms of the project.

    KLIA's principal contractor - at least in the early to middle stages - was a BRITISH infrastructure contractor - Trafalgar House. Not Japanese mind you.

    Quite obviously , much of KLIA's equipment was British.

    There was also a lot of Japan-made content, which is unsurprising, as with any advanced technology, Japanese suppliers are important market players.

    To put it simply, much of KLIA's construction and equipment was selected on commercial terms on the open market.
    Most of the workers were Malaysian , Indons and Banglas.
    The principal consultants were British, not Japanese.

    Halfway through construction, Mahathir had a stupid quarrel with Britain, and kicked out the British, but that is a separate story.

    No surrender of Malaysian sovereignty.

    Compare and Contrast to the ECRL.
    Loans from China...OK, fine.

    Contractor - 100% China,
    Construction Equipment, Rolling Stock - 100% China.
    No pretense of any open market tender.
    All China workers.
    At the project launch site, all the banners were in Chinese...only Chinese literate Malaysians could read it.

    Mind you , local Chinese Malaysian businesses have Zero chance to participate in the project.

    As a loyal Malaysian, though I am Chinese, I say...the way the ECRL project is being conducted is a stupid surrender of Malaysian sovereignty to China.

    Fuck you Lim Sian See !

    1. Good to see you're still earning dedak properly from your Mahathir, and NOT one word from you about Maminco-Makuwasa, wakakaka

    2. Good to see you are earning your keep as a Najib attack pariah.

    3. if I'm a pariah so are you. Recall that old saying it takes a BIGGER pariah to call another person a pariah?

      But poor Innocent kaytee was just repeating Barry Wain's work and those of other more learned authors, wakakaka, so where's my own 'attacks' (unlike yours)?

  2. u said many times the initiator bear the most responsibility, thus in tis case, to stablise or corner the tin price started under hussain onn era, mahathir just follow so y blame him?

    1. well, who was PM in 1985 when Maminco started?

    2. So, bapak transformer is not as bad as bapak piratisation (lanun) eh?

    3. they are ALL bad, with only Tunku and Hussein Onn okay

    4. i thot mamingo happened during transition period of hussein onn n mahathir? n if we look into the series of event, from sime darby, guthrie, tin corner, to forex loss, all r with the intention to boost the malay esteem n wealth ie nep, some success n some not. hence u shd direct yr accusations back to mo1 dad that started the nep. but of course u would only pick selectively since u love mahathir so much.

    5. Yes, Maminco Sdn was incorporated in June 1981. Mahathir became PM in July 1981.

      Shall we blame Hussein Onn for his last couple of weeks?

      To extend credit to Maminco, BMF first loaned Maminco sums amounting (officially that was) US$260 million (RM663 million) in December 1981.

      Shall we again blame Hussein Oon?

      Then Makuwasa was set up in June 1984.

      Blame Hussein Onn?

  3. Maminco is just like forex. 'Betting the country' on the trade is wrong. It is the poor rakyat who have to suffer the consequences.

  4. Bottom line...."they are ALL bad..." ! Finally we get to pry this out, wakakaka