Commenting on reports that the government may embark on a divesting exercise, Universiti Malaya’s Edmund Terence Gomez said in some sectors, the government shouldn’t divest while there were no issues in others.
“With the banking sector, I’d be very careful about transferring big banks, like Maybank or CIMB, into private hands,” he said, adding that the same went for utility and transport companies.
“I’d have no problems if the government divested its stake in construction-type companies,” he added.
Gomez, who is an expert on corporate Malaysia and politics, said before divesting its stake, particularly in big institutions, the government must carry out an analysis to avoid concentrating wealth in the hands of a small minority.
“Who are these private investors who will buy these stakes? If we are talking about the continuation of Bumiputera policies, who are these Bumiputeras? By right it should be by open tender.”
He said the big questions surrounding divesting included whether those taking over the government’s stakes had the capacity and financing to bring these companies forward and their sources of funding.
In the worst case scenario, if no such due diligence was carried out, the country could see the selective distribution of assets without transparency, he warned.
“We’ve seen selective patronage to fulfil the Bumiputera agenda. This is fine but in the process, when there was no openness or transparency, it went into the hands of well-connected people who got funding from government-owned banks.”
In the end, Gomez said, a number of these companies failed and the government had to re-nationalise them.
“We cannot repeat the mistakes of the 1990s,” said Gomez, citing past bailouts of companies like Malaysia Airlines, UEM and Renong.
In the worst case scenario, if no such due diligence was carried out, the country could see the selective distribution of assets without transparency, he warned.
“We’ve seen selective patronage to fulfil the Bumiputera agenda. This is fine but in the process, when there was no openness or transparency, it went into the hands of well-connected people who got funding from government-owned banks.”
In the end, Gomez said, a number of these companies failed and the government had to re-nationalise them.
“We cannot repeat the mistakes of the 1990s,” said Gomez, citing past bailouts of companies like Malaysia Airlines, UEM and Renong.
Reuters recently reported, citing sources, that sovereign wealth fund Khazanah Nasional was likely to divest some top state-linked firms, including CIMB, Axiata Group, Telekom Malaysia and even IHH Healthcare.
Gomez also spoke on the need for the government to disclose Bumiputera equity figures, a practice he said was discontinued a decade ago, especially as Putrajaya is organising a Bumiputera economic congress.
“We need to look at the figures and study what went wrong or right before we start debating how we are going to move forward,” he said after launching the Malaysia GLC Monitor 2018 report at Universiti Malaya on Monday.
He added that there had to be a re-tabulation of the Bumiputera equity figures, not on par value but based on their market value.
Related:
Gomez also spoke on the need for the government to disclose Bumiputera equity figures, a practice he said was discontinued a decade ago, especially as Putrajaya is organising a Bumiputera economic congress.
“We need to look at the figures and study what went wrong or right before we start debating how we are going to move forward,” he said after launching the Malaysia GLC Monitor 2018 report at Universiti Malaya on Monday.
He added that there had to be a re-tabulation of the Bumiputera equity figures, not on par value but based on their market value.
Related:
Khazanah, being a Govt. owned Sovereign Fund and it's sale of stake to raise revenue for the Govt. should proceed for it serve no purpose except giving high paying salaries to cronies of the Govt. The complete sale of all it's assets could easily raise several hundred billions RM.
ReplyDeleteAll sales should not be to private individuals like before but instead to PNB, EPF, KWAP, Tabung Haji, LTAT etc which will ensure the control of National strategic assets remains with local institutions. Selling to rich private individuals is just blatant abuse and cronynism.
What's the point of having Khazanah all these while when their returns back to the Govt. since it's inception is so poor?
Can you stop perpetuating the lie that returns for Khazanah are poor? Under Azman Mokhtar's management it was 9plus percent per annum. That is good by any measure especially with the burden of having to take on and restructure Proton, MAS and Silterra, failed projects under Dr M.
DeleteThis return exceeds other sovereign wealth funds including Temasek (for the comparable period).
Temasek - Making a Difference in Asia and Beyond. Hmmm... Khazanah - Making a Divestment to Coterie and Crony. Well if that is the political goal (gold), so be it.
ReplyDeleteDon't repeat the mistakes of the 1990's is sound advice, but ChaBo should not jump at shadows to already pronounce the Harapan Government guilty without anything actually happening.
ReplyDeleteAs I said, Forest City is a conduit for money laundering which BOTH China and Malaysia want to stop.
ReplyDeleteQUOTE
Invest in China, get free condo' - Putrajaya’s gripe with Forest City
Faisal Asyraf
1 Sep 2018, 8:38 pm
Putrajaya's gripe with the Forest City project is that free residential units within the development are being offered in exchange for investments in China, according to Economic Affairs Minister Mohamed Azmin Ali.
Azmin said this in stressing the need for people to understand why Putrajaya is reviewing the Johor development specifically.
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One HUGELY EXCESSIVE project, the RM120B HSR by the Najib administration cannot be avoided due to the stupid one-sided agreement, has successfully been deferred by two years, thanks to the great teamwork shown by Funance and Economic Affairs Ministers. THat's why we need these TWO positions. While Guanee was holding fort at home shepherding the repeal of the GST Act and getting the SST back on track in both houses of Parliament, Azmin did a wonderful job with SGP on the re-negotiated HSR deal. That was why neither one of them could accompany TDM on his visit to China - they had to stay back and clean up the mess left behind by the BN government.
ReplyDeleteP/S Perhaps now TDM will soften his stance on the Middle Rocks?
QUOTE
Report: M'sia spared RM500m penalty, HSR deferred for 2 years
Published: 1 Sep 2018
Malaysia and Singapore appear to have reached a compromise which will see Putrajaya being spared a RM500 million penalty for a two-year deferral of the Kuala Lumpur-Singapore High-Speed Rail (HSR) project, according to business weekly The Edge.
The report, which was also carried by its sister portal The Edge Property, said the deferral will be in effect until May 31, 2020.
Citing sources, it said the agreement was reached "in a spirit of good neighbourliness".
The source added that Singapore recognised the strain the project's construction could have on Malaysia's financial health.
The report said that the original agreement to build the HSR, which was signed in 2016, did not contain provisions for a postponement.
Malaysia would have faced up to RM500 million in penalties, had it decided to drop the project.
Pakatan Harapan, after taking over the government after the May 9 general election, had revealed the project could cost up to RM110 billion.
Economic Affairs Minister Mohamed Azmin Ali had been in negotiations with Singapore in the last month to reach a compromise.
Azmin, in a meeting with Singapore's Transport Minister Khaw Boon Wan on Thursday, had said they were inching closer to a "win-win deal".
Prime Minister Dr Mahathir Mohamad had accused the previous government of raking up a debt of up to RM1 trillion.
He had since embarked on an effort to pare down the country's debt, including postponing megaprojects and slashing government spending.
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I wonder if this will be one of Najib's 1MDB defence:
ReplyDelete"1MDB has done no wrong. It's just that 1MDB practices a different accounting system that nobody in Singapore, Switzerland, USA, Malaysia etc etc understands. You guys just need to use our accounting standards"
QUOTE
Najib: LGE doesn’t understand govt uses different accounting system
By FMT Reporters - September 1, 2018
PETALING JAYA: Former finance minister Najib Razak said his successor Lim Guan Eng doesn’t understand that the government uses a different accounting system from that of the private sector.
In a Facebook post, the former prime minister responded to Lim’s claims yesterday that the previous administration had recorded RM14.56 billion in unrefunded taxes as revenue, ultimately resulting in a shortfall in money for the Tax Refunds Trust Fund.
Lim had said this was deemed as “falsifying accounts”.
Najib said the government used the modified cash accounting system and not the accruals accounting standard used in the private sector.
Under the modified cash accounting system, all financial transactions are calculated and recorded when there are deposits and withdrawals of cash for the financial reporting period.
“Under this standard, assets not capitalised and liabilities are not recorded in the financial report.”
That, Najib said, was why Lim had come to the “incorrect conclusion” that the previous Barisan National administration had misreported unreturned taxes as revenue and had accused it of falsifying the accounts.
“Just like the confusion over the decimal point, the misunderstanding between the accounting systems is an easy mistake commonly made by anyone.”
Najib noted, however, that under the civil service transformation initiative during his administration, the government had been moving towards an accruals accounting standard
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https://m.malaysiakini.com/news/441328
ReplyDeleteSpy Chief charged with Money Laundering says she was only following orders.
Bagus...Bagus...time to go up the Chain Of Command, as I always say.
Another Najib-instructed criminal activity ?
MACC investigations into our spy agency MEIO and it's former boss Hasanah is taking an unexpected turn, ie it may be related to 1MDB money and it's conduit back into Malaysia as and when it is needed. Using the spy network cash can be brought in bypassing Customs declaration. And when BN unexpectedly lost GE14 the spies helped themselves to the cash in transit.
ReplyDeleteQUOTE
KUALA LUMPUR, Sept 2 — Over RM20 billion of 1Malaysia Development Berhad’s (1MDB) funds remain unaccounted for in the hands of various individuals around the world, a report said.
The New Sunday Times reported anonymous sources as saying that these individuals based in locations such as the Middle East supposedly channeled the money back to KL for political funding, among others.
The common method of couriering cash had to be reviewed as several countries remain on high alert for funds linked to 1MDB.
Authorities including the United States’ Federal Bureau of Investigation (FBI) connected this to US$12 million (RM49.4 million) traced to the Malaysian External Investigation Organisation (MEIO) from the Prime Minister’s Department.
It is believed around RM1 million worth of US dollars was brought into the country via the Kuala Lumpur International Airport (KLIA) in late April, with some former MEIO personnel serving as movement conduits.
The Malaysian Anti-Corruption Commission plans to question some MEIO officers abroad as part of its probe.
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Is cheebye motherfucker kaytee trying to create traffic for his fucking blog? You guys should focus in exposing true identity of cheebye kaytee. Much more fun
ReplyDeleteaiyoh, I know you are desperate to call me Father but for the thousandth time, I did NOT fCk your mum so I cannot be your motherfucker and thus your Dad
DeleteAs usual we jumped the gun.
ReplyDeleteQUOTE
DISCUSSIONS to include Petron Fuel International Sdn Bhd (Petron) as a fuel supplier for federal government vehicles started two years ago under the previous Barisan Nasional government, said the Finance Ministry today.
In a statement, the ministry said that the move to appoint Petron was an administrative decision on operational matters and, as such, neither Prime Minister Dr Mahathir Mohamad nor Finance Minister Lim Guan Eng needed to be consulted.
UNQUOTE
when it suits pakatan, it was najib's decision and no one could do anything about it
Deleteagain when it suits pakatan, it will cancel all najib's decisions as it is now the government and has that right
wakakaka, what a hypocrite
ChaBor is as usual over-eager to sanitise his benefactor.
DeleteI don't see MOF ever saying nothing could be done about it. They actually said Person had made the application more than 2 years ago, and the decision was ultimately an administrative matter, not a political one.
".. make them as big as you can, while you can.. "
ReplyDelete