Archive for category Financial Scandals

Amendment to Motion of Thanks to direct the PAC and the Police to immediately investigate the RM42 billion 1MDB scandal without waiting for Auditor General’s Report on 1MDB

There are many other issues which explain why Malaysia is now teetering on a crisis as a result of the economic and political gridlock paralyzing the country.

As time does not permit a discussion of all these issues, I will just quickly refer to some of them:

* Malaysia’s reputation as a country safe for investors received a grievious blow when a series of judicial decisions raised national and international questions as to whether Malaysia had restored its previous high international repute for a truly independent judiciary and just rule of law because of the following cases:

i. the Federal Court’s 5-0 unanimous decision to dismiss Anwar Ibrahim’s appeal and five-year jail sentence in Sodomy II trial;

ii. the Federal Court’s decision to convict and sentence to death former police commando Azila Hadri and Sirul Azhar Umar for the 2006 murder of Mongolian Altantuya Shaariibuu, while leaving completely open the question of motive for the murder and who had ordered Azila and Sirul to murder Altantuya;

iii. the expose by retired Court of Appeal judge Justice K.C. Vohrah that former Chief Justice Eusoff Chin had caused a miscarriage of justice in the infamous Ayer Molek Rubber Company vs Insas Bhd case two decades ago;
iv.the black-listing, discrimination and continued by-passing of Court of Appeal judge Justice Mohamad Hishamudin Mohd Yunus from elevation to the Federal Court;

v. the victimization of the country’s first judicial whistleblower, former High Court judge Datuk Syed Ahmad Idid, who was penalized instead of being rewarded. Read the rest of this entry »

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Twin ghosts haunt Malaysia’s sovereign fund

By Una Galani
Reuters
March 12, 2015

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Malaysia’s 1MDB faces a daunting task. The six year-old sovereign fund was set up to finance big national projects but expanded too fast, took on heavy debts and is now at the centre of a growing controversy. An ambitious restructuring brings both political and financial risks.

The fund which counts Prime Minister Najib Razak as chairman of its board of advisors has pledged to dismantle itself following a strategic review led by new chief executive Arul Kanda. It plans to stop making new investments and raise cash through an initial public offering of Malaysia’s second largest independent power producer. Selling unused land and finding equity partners for real estate projects that include a new financial centre in Kuala Lumpur and a development built around the terminus for a planned high-speed rail link with Singapore should bring in additional funds.

1MDB’s most pressing objective is to pay down net debt, which stood at around 38 billion ringgit ($10.3 billion) in March 2014. In the same year it made a net loss of 665.4 million ringgit, despite booking a gain from the revaluation of its property portfolio. Absent similar revaluations, it also made a loss in the previous two years. Read the rest of this entry »

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Something is really “rotten in the state of Denmark” when the twitter-happy IGP can chop and change on an important issue on police investigations into the RM42 billion 1MDB scandal

On February 10, former Prime Minister Tun Mahathir Mohamad quoted Shakespeare’s Hamlet on “something is rotten in the state of Denmark”, and this sense of “rottenness” in Malaysia is increasingly exacerbated with passing weeks and days.

When the twitter-happy Inspector-General of Police Tan Sri Khalid Abu Bakar can chop and change on an important issue on police investigations into the RM42 billion 1MDB scandal, something is really rotten in the “state of Denmark” in Malaysia.

On Monday, 9th March, the Inspector-General of Police, Tan Sri Khalid Abu Bakar caused quite a media sensation when he announced a high-powered three-agency special task force to investigate the biggest financial scandal in the nation’s history, the RM42 billion 1MDB scandal comprising the police, the Malaysian Anti-Corruption Commission (MACC) and the Attorney-General’s Chambers.

But Khalid, who said the task force would even investigate the Prime Minister, was contradicted by the MACC Chief Commissioner Abu Kassim Mohamed who said on the same day that the MACC would wait for the Auditor-General’s report on 1MDB before starting its own probe.

The MACC Chief Commissioner seemed to be unaware of the three-agency task force on 1MDB which Khalid said was formed the previous week.

The IGP and the MACC should clarify whether there is such a three-agency special task force on the 1MDB or whether it only existed in the imagination of the IGP.

But strangest of all, the very next day, Tuesday, 10th March, Khalid backtracked and announced that the special task force would only start their investigations into the 1MDB after the Auditor-General had completed his scrutiny and uncovered discrepancies and wrongdoings. Read the rest of this entry »

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Auditor-General’s assurance of professional audit of 1MDB most welcome although public confidence have not been helped by contradictory or uncharacteristic statements by MACC and Police

I welcome the promise by the Auditor-General Tan Sri Ambrin Buang that his department will call up any individual necessary even Prime Minister Datuk Seri Najib Razak in completing an independent audit on strategic fund 1Malaysia Development Bhd (1MDB).

The Auditor-General’s assurance of professional audit of 1MDB and not to be swayed by extraneous considerations is most welcome, although public confidence that the various authorities would adopt a professional, accountable and responsible approach in the handling of the 1MDB scandal had not been helped by contradictory or uncharacteristic statements by the Malaysian Anti-Corruption Commission (MACC) and the Police.

Suddenly, there seems to be a competition among the various departments to show courage and eagerness to investigate the Prime Minister, Datuk Seri Najib Razak himself – as not only Ambrin does not rule out such possibility, even the Inspector-General of Police, Tan Sri Khalid Abu Bakar pointedly said that Najib would be one of the targets of investigation by a three-agency task force to probe the 1MDB scandal.

In fact, the IGP’s announcement has detracted the credibility of the Auditor-General’s statement that his department’s audit would not exclude an investigation into the Prime Minister, for who would believe the IGP’s claim when he had been guilty of kid-glove treatment to BN Ministers and leaders, letting off the Minister of Agriculture and Agro-based Industries Datuk Ismail Sabri for the most racist and seditious incitement in calling on Malay consumers to boycott Chinese businessmen and allowing the former Deputy Minister in the Prime Minister’s Department, Datuk Mashitah Ibrahim to enjoy impunity and immunity for spouting heinous lies to incite religious hatred, conflict and tension in plural Malaysia. Read the rest of this entry »

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Auditor General Ambrin must buck up as six-day inaction on investigation into 1MDB dereliction of duty

The Auditor-General Tan Sri Ambrin Buang must buck up and get on with his work and responsibility as the six-day inaction on investigations into the RM42 billion 1MDB scandal is a major dereliction of duty.

Malaysians want to know why the Auditor-General has not swung into immediate action to investigate into the biggest financial scandal in the nation’s history after the Prime Minister, Datuk Seri Najib Razak had directed him on Wednesday to independently verify 1MDB’s accounts
Malaysians can still remember the poor and unacceptable reasons given by Ambrin last November why he was not auditing 1MDB accounts.

This was what Ambrin said on November 12, 2014 at a media session in Kuala Lumpur in conjunction with the third series of the auditor’s report 2013:

“My answer is as far as their accounts are concerned, it has already been audited by one of the big four (audit firms), so there is no reason why we should ask them to open up their books because auditing financial statements is very laborious (with) examination of documents and things like that.”

Ambrin was rightly flayed in the media for “passing the buck to The Big Four”, and “lectured” that if auditors were infallible, there would be no financial scandals in the world. Read the rest of this entry »

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Muhyddin should not have a sudden attack of “cold feet” suffering withdrawal symptoms but must continue to be bold and forthright to defend public interests and the principles of accountability and good governance in the handling of the RM42 billion 1MDB scandal

The Deputy Prime Minister and Deputy UMNO President, Tan Sri Muhyiddin Yassin should not have a sudden attack of “cold feet”, suffering withdrawal symptoms from his courageous and commendable statement on the 1MDB on Friday night, but must continue to be bold and forthright to defend public interests and the principles of accountability and good governance in the handling of the RM42 billion 1MDB scandal.

Muhyiddin was denying the undeniable when he said yesterday that his Friday night statement on 1MDB did not contradict the Prime Minister, Datuk Seri Najib Razak.

His so-called “denial” that he had contradicted Najib has only drawn further attention to the differences between Muhyiddin’s seven-para statement and the six-para PMO Statement on the Cabinet position on 1MDB released after the Cabinet meeting on Wednesday.

A study of the two statements will reach the ineluctable conclusion that Muhyiddin’s statement was not just “expressing what the cabinet had discussed with regard to the issue (1MDB) but also gone beyond that”, when was in fact a repudiation of the PMO Statement, smashing it to smithereens.

Had Muhyiddin fully studied and realised the full implications of his Friday night statement when he lent his signature to it?
Read the rest of this entry »

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Muhyddin’s seven-para statement has smashed Najib’s six-para PMO Statement on Cabinet position on RM42 billion 1MDB scandal into smithereens

Within 42 hours of the meeting of UMNO Divisional chiefs in Kuala Lumpur at 3 pm tomorrow Sunday), the Deputy Prime Minister and UMNO Deputy President, Tan Sri Muhyiddin Yassin has thrown a bomb to shatter the facade of UMNO and Cabinet unity which the Prime Minister’s Datuk Seri Najib Razak’s PMO Communications Unit had carefully crafted with a six-paragraph statement after the Cabinet meeting on Wednesday on the RM42 billion 1MBD scandal.

Muhyiddin’s seven-paragraph statement late last evening has smashed Najib’s six-para PMO Statement on the Cabinet position on the RM42 billion 1MDB scandal into smithereens. Read the rest of this entry »

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Are 1MDB’s woes revealing a fractured Najib government?

COMMENTARY BY THE MALAYSIAN INSIDER
6 March 2015

The Cabinet might have tried to put up a united front over debt-heavy 1Malaysia Development Bhd’s (1MDB) financial woes but it took Tan Sri Muhyiddin Yassin just 48 hours to crack that façade.

His seven-paragraph statement tonight made three points not found in the Prime Minister’s Office (PMO) statement on Wednesday which said, “Cabinet expressed confidence that no wrong-doing has been committed within 1MDB, and their desire for the company to be allowed to implement the proposed outcomes of its strategic review.”

Muhyiddin’s points were simple for a company that reportedly sits on a RM51 billion asset base that can cover its RM42 billion debts.

For him, there should not be any bailout of 1MDB if it involves public funds, the Auditor-General must verify 1MDB’s accounts from 2009, and that the Public Accounts Committee (PAC) should carry out an independent probe. Read the rest of this entry »

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The six-paragraph PMO statement on Wednesday on Cabinet meeting on RM 42billion 1MDB scandal signifies the arrival of “The Whale” in Malaysian politics overshadowing not only the 10-Minister PM Department but the 35-Minister Cabinet

The London Sunday Times expose on Sunday, which shook the Najib administration to its very roots with reports of joint Sunday Times-Sarawak Report investigations into the RM42 billion 1MDB scandal and revelation that they have obtained access to thousands of 1MDB transactions and email which 1MDB had attempted at the end of last year to wipe out from all its computers, employee laptops and servers, started with the story of “The Whale”.

In its report “Harrow playboy linked to troubled Malaysian fund”, Sunday Times London of Sunday, 1st March 2015 which launched its series of investigation exposes on 1MDB scandal (which has forced the Malaysian authorities to seriously think of an “exit strategy” for Najib in 1MDB) opened as follows:

“IN THE summer of 2009, a Malaysian nicknamed ‘the Whale’ appeared on the New York nightclub scene. He would travel with a large entourage in a fleet of Cadillacs and his party would spend tens of thousands of dollars a night in the company of socialites such as Paris Hilton.

“’The Whale’ is said to have celebrated his 28th birthday with a four-day event in Las Vegas that included a party at a pool surrounded by caged lions and tigers. Manhattan was abuzz with questions over his identity and the source of his wealth.

“It emerged that the ‘mystery man’ of the nightclubs was the Malaysian tycoon Taek Jho Low, who had been educated at Harrow School and the Wharton School in Pennsylvania. He claimed his success was due to being in the ‘right place at the right time’. Read the rest of this entry »

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The Cabinet meeting and outcome on 1MDB yesterday seemed to have been scripted and choreographed by Najib’s “master publicist” Paul Stadlen with one objective in mind – to avoid accountability for the RM42 billion MDB scandal in the whole month of Parliament beginning on Monday

The Cabinet meeting and outcome on 1MDB yesterday seemed to have been scripted and choreographed by the Prime Minister, Datuk Seri Najib Razak’s “master publicist” Paul Stadlen with one objective in mind, to avoid accountability for the RM42 billion 1MDB scandal in the whole month of Parliament beginning on Monday.

If true, this must be the first time a Cabinet anywhere in the world is led by the nose like a flock of sheep by a “master publicist” to play out the script choreographed even before the Cabinet meeting, which does not redound to the credit of Malaysia’s Ministers, whether their intelligence or integrity.

The cabinet decided, after 1MDB and its auditors provided a briefing on the company’s current situation and responded to a series of questions posed by Cabinet Ministers, including the Prime Minister and Deputy Prime Minister, that the debt-laden state investment firm 1MDB has done nothing wrong.

Did all the 35 Cabinet Ministers yesterday know what they were doing and fully understood the going-ons in 1MBD in the past six years when they issued a clean bill of health and integrity to 1MDB?

Were they presented with any Cabinet papers on the 1MDB to read and study before the Cabinet meeting?

Were they given access to the “thousands” of 1MDB transactions and email which London Sunday Times and Sarawak Report have said they have obtained access to, despite abrupt attempts by 1MDB at the end of last year to call in all of its computers, employee laptops and servers to wipe them clean of such transactions and emails? Read the rest of this entry »

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Will the Cabinet continue the traditional three monkeys role of “eyes that see not, ears that hear not and mouths that speak not” or will they take the bull by the horn to address the three issues which dominate public opinion in past week?

Just before midnight, a Cabinet Minister tweeted that he had just left his constituency which is about three hours’ drive from Kuala Lumpur: “Need to read cabinet papers after I reach home. Tmr morning cabinet meeting as usual.”

My first thought was whether the Cabinet papers would include the thousands of 1MDB transactions and email which 1MDB had tried to “wipe” clean from their computers and servers at the end of last year.

Will the Cabinet papers for all Ministers for the Cabinet meeting later this morning cover at least the three issues which had dominated public opinion in Malaysia in the past week, or will it be another Cabinet meeting to avoid and skirt important national issues like the infamous past Cabinet meetings?

First Issue. Leading the three important issues which should dominate a meaningful Cabinet meeting today is undoubtedly the RM42 billion 1MDB scandal, which has been blown wide open by the joint London Sunday Times/Sarawak Report investigations and access to thousands of transactions and email of 1MDB despite abrupt attempts by 1MDB at the end of last year to call in all of its computers, employee laptops and servers to wipe them clean of all emails.

Will the Cabinet end its traditional three monkey stance of “eyes that see not, ears that hear not and mouths that speak not” on the 1MDB scandal for the past six years, take the bull by the horn and decide either to set up a Royal Commission of Inquiry headed by former Law Minister Datuk Mohd Zaid Ibrahim or other independent credible Malaysians or give support for a full-scale Public Accounts Committee (PAC) public inquiry into the 1MDB scandal? Read the rest of this entry »

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Emails Blow Malaysia’s 1MDB Fund Wide Open

Asia Sentinel
By Our Correspondent
Posted on March 1, 2015

Sarawak Report blog details how deeply a flamboyant financier and friend of PM Najib actually ran the fund

In December of last year, the controversial investment fund 1Malaysia Development Bhd abruptly called in all of its computers, employee laptops and servers and wiped them clean of all emails.
(Read: Controversial Malaysian Investment Fund’s Computer Records Wiped Off)

It was too late. The reason has come embarrassingly clear with a report by Clare Rewcastle Brown, the indefatigable blogger who edits The Sarawak Report. Rewcastle Brown had already obtained thousands of emails and documents before the shutdown, detailing that transactions by the fund were actually run by Taek Jho Low, a close friend of the family of Prime Minister Najib Tun Razak. There were times when the CEO of 1MDB, Shahrol Halmi, and his Malaysian colleagues had no idea what was going on.

Jho Low has repeatedly told the media that he has had nothing to do with 1MDB’s investment activities, and that he has received no money or benefits. But the emails allegedly show that he orchestrated a 2009 joint venture between 1MDB, as the fund is known, and a fledgling oil exploration firm called PetroSaudi International, which was little more than a shell. Read the rest of this entry »

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Harrow playboy linked to troubled Malaysian fund

Jon Ungoed-Thomas, Clare Rewcastle and Josh Boswell
The Sunday Times London
1 March 2015

IN THE summer of 2009, a Malaysian nicknamed “the Whale” appeared on the New York nightclub scene. He would travel with a large entourage in a fleet of Cadillacs and his party would spend tens of thousands of dollars a night in the company of socialites such as Paris Hilton.

“The Whale” is said to have celebrated his 28th birthday with a four-day event in Las Vegas that included a party at a pool surrounded by caged lions and tigers. Manhattan was abuzz with questions over his identity and the source of his wealth.

It emerged that the “mystery man” of the nightclubs was the Malaysian tycoon Taek Jho Low, who had been educated at Harrow School and the Wharton School in Pennsylvania. He claimed his success was due to being in the “right place at the right time”.

Low certainly has a wide range of business interests, building up a £650m investment fund that he started at university. He also runs Jynwel Capital, a Hong Kong fund with investments in media, retail, property and commodities. His family is independently wealthy. Read the rest of this entry »

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Cabinet tomorrow must decide whether to establish RCI headed by Zaid Ibrahim into RM42 billion 1MDB scandal or give support for full-scale PAC public inquiry taking priority over all other PAC agendas

Will the Cabinet meeting tomorrow hide and run from the biggest financial scandal in the country and the issue which is casting the greatest cloud and doubt on the credibility, integrity and good governance of the Malaysian Prime Minister and government, both nationally and internationally – the RM42 billion 1MDB scandal?

The Cabinet tomorrow should give special focus to the 1MDB scandal, and either decide to establish a Royal Commission of Inquiry headed by former Law Minister Datuk Mohd Zaid Ibrahim and other independent credible Malaysians into the 1MDB scandal or give support for a full-scale PAC inquiry into 1MDB scandal, taking priority over all other PAC agendas.

The five Pakatan Rakyat MPs on the Public Accounts Committee (PAC), Deputy PAC Chairman Dr. Tan Seng Giaw (Kepong – DAP); Kamarul Baharin Abbas (Telok Kemang – PKR); Kamaruddin Jaffar ( Tumpat – PAS), William Leong Jee Keen (PKR – Selayang) and Tony Pua (PJ Utara – DAP) want a PAC hearing on 1Malaysia Development Bhd so that the Finance Ministry-owned firm’s past and present chief executives and auditors would be held accountable.

Even the PAC Chairman Datuk Nur Jazlan Muhamad (Pulai) has recently changed his stand on the 1MDB scandal and wants the Auditor General’s Department to immediately carry out an audit of the government-owned 1MDB’s deals before PAC calls up the company.

But this is all before the latest shock expose that Sarawak Report website with London’s Sunday Times newspaper have completed an in-depth investigation into the trail of the missing billions at the heart of the 1MDB scandal, claiming to have obtained access to thousands of documents and emails relating to 1MDB transactions which the company had attempted to wipe clean from its computers and servers at the end of last year.

This development has changed the picture completely. Read the rest of this entry »

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Call on Najib to set up a Royal Commission of Inquiry into the RM42 billion 1MDB scandal with 1MDB the sole agenda of Cabinet on Wednesday

I have just seen the Sarawak Report website claiming that together with London’s Sunday Times newspaper, it has completed an in-depth investigation into the trail of the missing billions at the heart of Malaysia’s 1MDB (One Malaysia Development Berhad) financial scandal.

It claimed to have obtained access to thousands of documents and emails relating to transactions by 1MDB, including its initial joint venture with the little known oil company PetroSaudi International from 2009.

It alleged that the documents establish that, in spite of copious official denials, the entire joint venture project was conceived, managed and driven through by the Prime Minister’s associate and family friend the party-loving billionaire tycoon, Jho Low and that the documents also prove that the USD$700 million so-called “loan” that was supposedly repaid to PetroSaudi as part of the joint venture agreement, was actually a “front” to channel the money to a company controlled by Jho Low.

It had previously been reported that all computers and servers at 1MDB had been called in and wiped clean just before the end of last year, and if it it is true that the combined investigation team of Sarawak Report and London Sunday Times have obtained access to “thousands of documents and emails” relating to transactions by 1MDB, then we have the makings of the biggest financial scandal in the nation’s history.
The RM42 billion 1MDB scandal is setting a record as the greatest of all the financial scandals in the country, eclipsing even the worst and biggest of Mahathir’s financial scandals. Read the rest of this entry »

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After Ananda Krishnan loan, 1MDB now needs government cash

BY THE EDGE FINANCIAL DAILY
The Malaysian Insider
23 February 2015

1MDB was not only helped by billionaire T. Ananda Krishnan to settle its RM2 billion debt to banks, but it may also require a cash injection of as much as RM3 billion from its owner, the Ministry‎ of Finance (MoF), say sources.

They say the controversial debt-laden outfit is facing a cash crunch as income from its power assets is not enough for debt servicing and it has run out of borrowing options, as shown by having to turn to a businessman for help.

Ananda provided a 15-month RM2 billion loan to enable 1MDB to settle its loan with a consortium of local banks on February 13.

Sources familiar with the matter confirmed this with The Edge Financial Daily and also expressed their surprise that 1MDB president and group executive director Arul Kanda Kandasamy had dismissed media reports about the loan from Ananda as mere speculation. Read the rest of this entry »

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1MDB-PetroSaudi deal includes repaying US$700 million debt, says whistleblower site

The Malaysian Insider
18 February 2015

Online news portal Sarawak Report has published a 26-page document, revealing sovereign fund 1Malaysia Development Berhad (1MDB) had paid US$1 billion of public funds into a shady venture with Petrosaudi International, despite its lack of a tangible track record.

“What the document reveals is that the prime minister and his advisors at 1MDB paid USD1 billion of borrowed public money into a venture that already carried a USD700 million debt in the form of a loan from PetroSaudi’s parent company to the subsidiary that was entering into the joint venture, PetroSaudi Holdings (Caymans) Limited,” it said in its report.

“Crucially, under the terms of the joint venture, agreed to by 1MDB, the Malaysian development fund had committed to pay back this whopping great loan to the parent company, PetroSaudi International, on day one of the joint venture!,” it added. Read the rest of this entry »

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Controversial Malaysian Investment Fund’s Computer Records Wiped Off

By Our Correspondent
Asia Sentinel
February 15, 2015

All computers and servers at 1Malaysia Development Bhd, the troubled investment fund backed by Malaysia’s Ministry of Finance, were called in and wiped clean just before the end of last year, the investigative blog Sarawak Report reported on Feb. 13.

1MDB employees told the blog that all computers and records at the fund were called in and cleaned, including personal computers and mainframe servers, supposedly because the fund’s system was hacked.

The chief economic advisor of the fund, which was started in 2009, is Prime Minister Najib Tun Razak. It reportedly faces RMB43 billion (US$12.01 billion) in debt and has been unable to meet loan payment dates several times. It was forced to go to Bank Negara, the country’s central bank, to ask for an extension in the payment dates, raising concern that its financial problems could threaten the entire Malaysian banking system. The bulk of the loans were made by the government-linked Malayan Banking Bhd or Maybank, and RHB Bank.

Sources confirmed the story to Asia Sentinel but the reason for the action appears unclear. It may stem from the fact that Sarawak Report, which is published by Clare Rewcastle Brown, announced last September that she had access to the fund’s emails. Read the rest of this entry »

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1MDB’s Lodin answers nothing

P. Gunasegaram
KiniBiz
TigerTalk | DECEMBER 29, 2014

Tiger is appalled at the misinformation that 1Malaysia Development Bhd (1MDB) chairman Lodin Wok Kamaruddin has dished out, claiming he is answering questions posed by the press. Its just a masquerade – as Tiger will show, he answers nothing.

Just before Christmas, the 1MDB chairman responded to recent press outbursts over 1MDB’s activities, expressing surprise over suggestions that the strategic development company has not responded to questions.

In a lengthy 2,500-word statement (reproduced in full at the end of this TigerTalk for those who would like to hear it from the horse’s mouth) he proceeded to give 1MDB’s version of unfolding events. It was a crafty piece of work, using half-truths to mask the shenanigans taking place at 1MDB, wholly owned by the Minister of Finance Inc to bring strategic investments into the country.

Let Tiger demolish some of Lodin’s arguments by simply extracting the relevant paragraphs and giving his own take on what the chairman says. The reader can judge for himself and if he wants context he can refer to Lodin’s statement reproduced in full without any alteration. Read the rest of this entry »

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Questions for 2015

Tan Siok Choo
The Sun Daily
29 December 2014

WITH 2014 drawing to a close, I have several questions about issues that arose this year but could impact Malaysia’s future.

Question 1: Why does Putrajaya persist in maintaining Malaysia’s growth in gross domestic product (GDP) in 2015 won’t be affected by plummeting prices of oil, a commodity that contributes significantly to federal government revenue?

Budget 2015 was prepared when Brent oil – the benchmark for Petronas’s Tapis blend – was in triple digits. Analysts estimate federal government revenue next year is based on an oil price of US$105 per barrel.

Last Friday, amid thin trade, Brent oil for February settlement closed at US$59.45 a barrel.

Labelling the World Bank’s revised forecast of 4.7% GDP growth next year as “too conservative”, top Malaysian policymakers announced the 5% to 6% economic growth target for 2015 will be maintained.

Admittedly, plummeting oil prices could be beneficial – it could stimulate global economic growth and reduce fuel costs for motorists and for sectors like airlines and truckers. Even so, shouldn’t Putrajaya prepare for the worst rather than adopt a wait-and-see attitude? Read the rest of this entry »

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