Tuesday, June 23, 2015
1. “Foreign Affairs” is an American magazine. It is highly respected in America but it is not my favourite magazine.
2. Recently while flying I came across its latest edition. Its theme in the issue is on race and colour and on how they affect relations between people. I became interested because I felt sure the magazine would have nothing good to say about Malaysia.
3. There is an article on colour-blindness in America – meaning to say that all Americans of whatever colour are equal. Apparently the equality between people of different colours has not produced good results. What it really means is that everything, including opportunities must be based on merit.
4. Sure there is a black man sitting in the Presidential chair in the White House. There was once a black general as Chief of the armed forces of America and as Secretary of State. And there has been and there are presently blacks holding high office in Washington.
5. But the fact remains that most of the blacks are poor, are constantly involved in drugs and crimes. Despite the blacks making up just about 10% of the population, the percentage of blacks in prison is nearly 50%. The per capita income of the blacks are well below the national average.
6. Being equal with the whites has not benefitted the blacks much. No mention is made of the deliberate killings of blacks by the police, who then escape indictment.
7. As I expected the magazines included a study of Malaysia’s record on race relations. It admitted that despite the affirmative action under the New Economic Policy, Malaysia’s economy performed better than most other developing countries. The races seem to be living in relative harmony. There were no serious racial clashes.
8. The affirmative action under the NEP seem to have reduced the disparity in wealth distribution between the indigenous Malays and the Chinese. There is mention of the bumiputra’s owning only 2 per cent of the countries wealth before NEP and their wealth has now increased to 19%. The disparity is still there but is much reduced. (In America Joseph Stiglitz writes that the disparity between rich and poor has reached a dangerous level).
9. India and South Africa have also tried affirmative action. But their results are not as good as in Malaysia.
10. It would seem that Malaysia has done a better job of building a more equitable multiracial society than most multiracial countries including the US. The policy of equality of treatment i.e. meritocracy has not yielded tangible results.
11. The magazine Foreign Affairs seems to admit that Malaysia’s affirmative action has merit. Like the reversal of the opinion on Malaysia’s fixed exchange rate policy, there now seem to be a reversal of condemnation of our affirmative action, at least by the Foreign Affairs magazine. Other foreign media simply copy the biased reports made a long time ago without trying to investigate the realities regarding Malaysia’s management of race relations and development of its economy.
VERSI BAHASA MALAYSIA
1. “Foreign Affairs” adalah sebuah majalah Amerika. Ia sangat dihormati di Amerika tetapi ianya tidaklah majalah kegemaran saya.
2. Baru-baru ini semasa saya dalam penerbangan saya terjumpa edisi terbaru Majalah ini. Tema dalam isu ini adalah kaum dan warna dan bagaimana mereka mempengaruhi hubungan antara manusia. Saya tertarik kerana saya merasakan pasti Majalah ini tidak mempunyai sebarang yang baik untuk dikatakan mengenai Malaysia.
3. Terdapat satu artikel mengenai buta warna (colour blindness) di Amerika – maknanya semua orang Amerika apa jua warnanya adalah sama. Rupa-rupanya kesaksamaan di antara orang yang berlainan warna tidak membawa kepada penghasilan yang baik. Makna sebenarnya ialah segala-galanya, termasuk peluang, mestilah berdasarkan merit.
4. Pasti pun ada seorang lelaki hitam duduk di kerusi Presiden di White House. Pada suatu masa ada seorang jeneral hitam memegang jawatan Ketua angkatan tentera Amerika dan sebagai Setiausaha Negara. Dan terdapat pada masa ini orang kulit hitam yang memegang jawatan-jawatan tinggi di Washington.
5. Tetapi pada hakikatnya, kebanyakan orang kulit hitam miskin, sentiasa terlibat dengan dadah dan jenayah. Walaupun kulit hitam merupai hanya kira-kira 10% daripada penduduk, peratusan orang kulit hitam di penjara adalah hampir 50%. Pendapatan per kapita orang kulit hitam adalah jauh di bawah purata kebangsaan.
6. Mempunyai taraf yang sama dengan orang kulit putih tidak memberi manfaat yang banyak kepada orang kulit hitam. Tidak disebut pula pembunuhan orang kulit hitam yang disengajakan oleh pihak polis, yang kemudiannya terlepas dakwaan.
7. Seperti yang saya jangkakan Majalah ini memasukkan kajian rekod Malaysia mengenai hubungan kaum. Ia mengakui bahawa walaupun terdapat tindakan afirmatif di bawah Dasar Ekonomi Baru, ekonomi Malaysia menunjukkan prestasi yang lebih baik daripada kebanyakan negara-negara membangun yang lain. Kaum-Kaum hidup dalam harmoni yang relatif. Tiada pergaduhan kaum yang serius.
8. Tindakan afirmatif di bawah DEB seolah-olah telah mengurangkan jurang perbezaan dalam pengagihan kekayaan antara orang Melayu asli dan orang Cina. Ada disebut juga bahawa Bumiputra memiliki hanya 2 peratus kekayaan negara sebelum DEB dan kekayaan mereka kini telah meningkat kepada 19%. Perbezaan itu masih ada tetapi berkurangan. (Di Amerika Joseph Stiglitz menulis bahawa jurang perbezaan antara yang kaya dan miskin telah mencapai tahap yang berbahaya).
9. India dan Afrika Selatan juga telah mencuba tindakan afirmatif. Tetapi hasilnya tidak sebaik seperti di Malaysia.
10. Nampaknya Malaysia lebih berjaya dalam membina masyarakat berbilang kaum yang lebih saksama daripada kebanyakan negara-negara berbilang kaum yang lain termasuk Amerika Syarikat. Dasar kesamarataan layanan iaitu meritokrasi tidak membuahkan hasil yang ketara.
11. Majalah Foreign Affairs seolah mengakui bahawa tindakan afirmatif Malaysia mempunyai merit. Sepertimana terdapat perubahan pendapat mengenai dasar kadar pertukaran tetap Malaysia, kini terdapat juga perubahan kutukan mengenai tindakan afirmatif kita, sekurang-kurangnya oleh Majalah Foreign Affairs. Media asing lain hanya menyalin laporan berat sebelah yang dibuat lama dahulu tanpa cuba untuk menyiasat realiti mengenai pengurusan hubungan kaum Malaysia dan pembangunan ekonominya.
Thursday, June 18, 2015
1. To all my criticisms 1MDB, can only say that they are all wrong. But there are no proofs given. The answer is always about secrecy of Government matters.
2. I know about the TIA refusal to allow the future products of Terengganu oil wells to be used as collateral by talking to the people who were actually involved with the TIA. The Federal Government as guarantor for the RM5 billion loan was because Terengganu rejected the absurd. Why should Terengganu pull out of the Federal Government’s initial proposal that its oil wells future production be the collateral.
3. No Cabinet paper on the 5 billion loan was presented. Produce the paper for the public to see. Of course you will say Cabinet papers are secret.
4. If the loan is not off-budget then show in the Government yearly budget provision for raising the loans. There is none.
5. There are written evidence about GOLDMAN SACHS terms for the bond issue. Show that GOLDMAN SACHS or Ambank did not impose high interest rate and 10% commission on the loan. Don’t just say it is a secret.
6. So 1MDB issued a 30-year bond. When it borrows money the suggestion is made that 1MDB would make money.
7. The yields accrue of 6.15% or whatever is for the purchasers of the bonds. 1MDB will have to dole out money for 30 years as interest which means it borrows now and our children will bear the burden. And 1MDB will get only 88 cent to 1 Ringgit. What is so good about that.
8. Okay. The interest p.a. is RM 2.4 billion and not RM3 billion. Can 1MDB pay that amount? Already it had to get money from Ananda and the IPIC to pay. Borrowing money to pay interest does not reduce the principal. It only increases the debt. Even if it is payment for shares or whatever the loan would still be there. So you cannot explain more. It is confidential – secret.
9. Thirteen power plants bought. But the big ones in Malaysia can be bought for a song. But by paying RM18 billion, 1MDB overpaid at least by RM3 billion. Why? If they are good assets, why cannot they be listed? Why is it that when Tenaga and Malakoff were rumoured to buy 1MDB power plants, their shares all plunged.
10. 1MDB is a Government company but when it bought Government land at 1/50th of the market price, the Government lose a huge sum of money.
11. When 1MDB sells the land, it is merely taking what should be Government earnings from the sale. That process is no different from people who sell APs, contracts and licence. Is this how 1MDB expects to make money?
12. Is 1MDB a strategic development company? What has it developed – nothing. Even TRX is all fence and nothing else.
VERSI BAHASA MALAYSIA
1. Bagi semua kritikan saya, 1MDB hanya boleh mengatakan bahawa semua adalah salah. Tetapi tidak ada bukti-bukti yang diberikan. Jawapannya sentiasanya adalah mengenai kerahsiaan urusan Kerajaan
2. Saya tahu tentang keengganan TIA untuk membolehkan produk masa depan telaga minyak Terengganu digunakan sebagai cagaran dengan bercakap dengan orang-orang yang benar-benar terlibat dengan TIA. Kerajaan Persekutuan sebagai penjamin bagi pinjaman RM5 bilion adalah kerana Terengganu menolak perkara yang tidak masuk akal. Mengapa Terengganu perlu menarik diri daripada cadangan awal Kerajaan Persekutuan bahawa telaga minyak pengeluaran masa depan menjadi cagaran.
3. Tiada Kertas Kabinet bagi pinjaman 5 billio telah dibentangkan. Tunjuklah Kertas itu untuk orang ramai melihat. Sudah tentu anda akan berkata kertas-kertas Kabinet adalah rahsia.
4. Jika pinjaman itu tidak off-budget tunjuklah dalam proses penyediaan bajet tahunan Kerajaan peruntukan yang memboleh membuat pinjaman-pinjaman itu. Tidak ada pun.
5. Terdapat bukti bertulis mengenai terma-terma GOLDMAN SACHS untuk terbitan bon. Tunjuklah bahawa GOLDMAN SACHS atau Ambank tidak mengenakan kadar faedah yang tinggi dan komisen 10% ke atas pinjaman. Jangan hanya mengatakan ini adalah rahsia.
6. Jadi 1MDB mengeluarkan bon 30-tahun. Apabila ia meminjam wang cadangan itu dibuat atas dasar 1MDB akan membuat wang.
7. Hasil terakru daripada 6.15% atau apa sahaja, adalah untuk pembeli bon. 1MDB perlu membayar wang selama 30 tahun sebagai faedah, yang bermakna ia meminjam sekarang dan anak-anak kita akan menanggung beban. Dan 1MDB akan mendapat hanya 88 sen pada 1 Ringgit. Apa yang baik tentang itu.
8. Okay. Faedah setahun adalah RM 2.4 bilion dan bukan RM3 bilion. Bolehkah 1MDB membayar jumlah itu? Sudah pun ia terpaksa mendapatkan wang dari Ananda dan IPIC untuk membayar. Meminjam wang untuk membayar faedah tidak akan mengurangkan pokok pinjaman. Ia hanya meningkatkan bebanan hutang. Walaupun ia adalah bayaran untuk saham atau apa pun, pinjaman akan masih wujud. Jadi, anda tidak dapat menjelaskan lagi. Ia adalah sulit – rahsia.
9. Tiga belas loji kuasa dibeli, Tetapi loji-loji yang besar di Malaysia itu boleh dibeli dengan harga paling murah. Tetapi dengan membayar RM18 bilion, 1MDB terlebih bayar sekurang-kurangnya sebanyak RM3 bilion. Mengapa? Jika loji-loji itu adalah aset yang baik, mengapa mereka tidak dapat disenaraikan? Kenapa apabila telah desas-desus bahawa Tenaga dan Malakoff akan membeli loji kuasa 1MDB, nilai saham mereka menjunam
10. 1MDB adalah sebuah syarikat Kerajaan tetapi apabila ia membeli tanah Kerajaan pada hanya 1/50 daripada harga pasaran, Kerajaan kehilangan sejumlah wang yang besar.
11. Apabila 1MDB menjual tanah itu, ia hanya mengambil apa yang sepatutnya menjadi pendapatan Kerajaan daripada penjualan itu. Proses itu tidak berbeza daripada orang-orang yang menjual AP, kontrak dan lesen. Adakah ini caranya 1MDB dijangka membuat wang?
12. Adakah 1MDB sebuah syarikat pembangunan strategik? Apa yang telah ia majukan? – Tidak ada apa. Malahan TRX adalah pagar sahaja dan tidak ada apa-apa.
Monday, June 15, 2015
MORE INVESTMENTS BY 1MDB (1Malaysia Development Berhad)
1. 1MDB entered into a JV with Petro Saudi. It is not a Saudi Government company. 1MDB paid USD 1billlion as its 40% share of the JV. As far as can be ascertained Petro Saudi did not pay a single cent.
1. 1MDB entered into a JV with Petro Saudi. It is not a Saudi Government company. 1MDB paid USD 1billlion as its 40% share of the JV. As far as can be ascertained Petro Saudi did not pay a single cent.
2. Then Petro Saudi is said to have bought the assets of Petro Saudi International, which is not owned by Petro Saudi. The JV between 1MDB and Petro Saudi then requested 1MDB to pay USD 700 million to settle the loan from Petro Saudi International to Petro Saudi.
3. The ownership of the oil fields in Argentina and Kazakhstan (or is it Turkmenistan) is not very clear, nor is the ownership of drilling ships.
4. Then suddenly USD 300 million of the payment by 1MDB is converted to a Murabaha loan. This USD 300 million seemed to have changed hands with lightning speed. We really don’t know where it is. And 1MDB will not tell us either.
5. Then there is the story of the investment in Cayman Islands. 1MDB did not invest directly but the money seems to have gone to Hong Kong companies owned by Jho Low. These companies apparently invested in Cayman Islands.
6. Then we are told by the Prime Minister that actually the fund is only recorded in Cayman Islands. The money is elsewhere, probably in Hong Kong. It is apparently invested in a hedge fund in Hong Kong.
7. When there was public uproar over the money being in Cayman Islands 1MDB agreed to bring it back. Although the money was said not to be in Cayman Islands, but the money was brought back from Cayman Islands in two tranches.
8. We are not told much about the first tranch. It was claimed to have been used to pay debts.
9. Then the second tranch with over 1 billion USD was brought back but not to Malaysia. It was brought back to Singapore and was deposited in a Swiss Bank.
10. Arul Kanda said he saw the cash there and Prime Minister said the money was there. It was not brought back because Bank Negara would ask too many questions. But Bank Negara must get the approval of the Minister according to the law for approving or disapproving any transaction. And the Minister is the effective head of 1MDB. So what is so difficult about getting Bank Negara’s approval?
11. Then the true reason came out. The Swiss Bank said no money had been deposited by 1MDB in the bank. The documents presented were false.
12. Then the Prime Minister amended his reply to Parliament stating that no money was brought back – only documents. What documents?
13. The second Minister of Finance now says it is “units”. Units of what?
14. 1MDB and the Prime Minister have not shown proof of the existence of the money from Cayman Islands. Is it in Singapore or has USD 1 billion dollars disappeared?
15. Statements without documentary proof are, as we have seen, quite useless. We need proof of all the investments and payments made by the 1MDB. But no proof has been shown accept for the acquisition of the power plants and purchase of Government land in Kuala Lumpur and private land in Penang. Until signed documentary proofs and not just statements by the Chief Executive Officer or Prime Minister, are shown, we have to assume that the money borrowed by 1MDB has disappeared.
VERSI BAHASA MELAYU
Terjemahan: More Investments by 1MDB
1. 1MDB memeterai suatu usaha sama (JV) dengan Petro Saudi. Ianya bukan sebuah syarikat kepunyaan Kerajaan Saudi. 1MDB membayar USD 1 billion sebagai saham 40% nya dalam syarikat usaha sama ini. Setakat mana yang dapat dipastikan Petro Saudi tidak membayar satu sen pun.
2. Kemudiannya Petro Saudi dikatakan telah membeli aset Petro Saudi International, yang tidak dimiliki oleh Petro Saudi. JV antara 1MDB dan Petro Saudi kemudiannya meminta 1MDB membayar USD 700 juta untuk menyelesaikan pinjaman daripada Petro Saudi International kepada Petro Saudi.
3. Pemilikan telaga minyak di Argentina dan Kazakhstan (atau adakah ianya Turkmenistan) tidak begitu jelas, dan begitu juga pemilikan kapal penggerudian.
4. Kemudian tiba-tiba USD 300 juta bayaran oleh 1MDB itu ditukar kepada pinjaman Murabaha. USD 300 juta ini seolah-olah telah bertukar tangan dengan kelajuan kilat. Kita benar-benar tidak tahu di mana ianya berada. Dan 1MDB tidak akan memberitahu kita juga.
5. Kemudian ada pula kisah pelaburan di Kepulauan Cayman. 1MDB tidak melabur secara langsung tetapi wang itu kononnya telah dipindahkan kepada syarikat-syarikat Hong Kong kepunyaan Jho Low. Syarikat-syarikat ini kemudian melaburnya di Kepulauan Cayman.
6. Kemudian kita diberitahu oleh Perdana Menteri bahawa sebenarnya dana ini hanya direkodkan sahaja di Kepulauan Cayman. Wang ini sebenarnya berada di tempat lain, mungkinnya di Hong Kong. Besar kemungkinan ianya dilabur dalam dana lindung nilai (hedge fund) di Hong Kong.
7. Apabila berlaku kegemparan awam ke atas wang yang berada di Kepulauan Cayman itu 1MDB bersetuju untuk membawanya pulang. Walaupun wang dikatakan sebenarnya tidak berada di Kepulauan Cayman, tetapi wang itu tetap dibawa balik dari Kepulauan Cayman dalam dua tranche.
8. Kita tidak diberi banyak maklumat tentang tranche pertama. Telah didakwa ianya digunakan untuk membayar hutang.
9. Kemudian tranche yang kedua dengan nilai lebih daripada 1 bilion USD telah di bawa pulang tetapi tidak terus ke Malaysia. Ia telah dibawa ke Singapura dan telah disimpan di suatu bank Swiss.
10. Arul Kanda berkata dia telah melihat wang tunai di sana dan Perdana Menteri pun berkata demikian juga. Ia tidak dibawa pulang terus ke Malaysia kerana Bank Negara akan bertanya terlalu banyak soalan. Tetapi Bank Negara perlu mendapatkan kelulusan Menteri, menurut undang-undang, untuk meluluskan atau tidak meluluskan sebarang transaksi. Dan Menteri pada hakikatnya adalah juga ketua 1MDB. Jadi apa yang begitu menyukarkan untuk mendapat kelulusan Bank Negara?
11. Kemudian sebab sebenar muncul. Swiss Bank berkata tiada wang yang telah didepositkan oleh 1MDB di bank itu. Dokumen-dokumen yang dikemukakan adalah palsu.
12. Kemudian Perdana Menteri meminda jawapannya kepada Parlimen dengan menyatakan bahawa tiada wang telah dikembalikan – hanya dokumen. Dokumen apa?
13. Menteri Kedua Kewangan kini berkata ia adalah “unit”. Unit apa?
14. 1MDB dan Perdana Menteri tidak menunjukkan bukti kewujudan wang dari Kepulauan Cayman. Adakah berada di Singapura atau USD 1 bilion dolar lesap?
15. Penyata tanpa bukti dokumentari, bagaimana kita lihat, tidak berguna. Kita perlu bukti kesemua pelaburan dan pembayaran yang dibuat oleh 1MDB. Tetapi tiada bukti telah ditunjukkan kecuali untuk pengambilalihan loji-loji janakuasa dan pembelian tanah Kerajaan di Kuala Lumpur dan tanah persendirian di Pulau Pinang. Sehingga bukti dokumentari yang ditandatangani dan bukan hanya kenyataan oleh Ketua Pegawai Eksekutif atau Perdana Menteri ditunjukkan, kita boleh menganggap bahawa wang yang dipinjam oleh 1MDB telah lesap.
Friday, June 12, 2015
1. From the comments on my blog and the questions I have been asked by people while shopping, it is clear that many do not know much about 1MDB. They know enough that Najib has done something wrong with the RM42 billion borrowed money, but are not clear about what is so wrong that I should call upon him to resign.
2. So I think I need to explain why 1MDB is wrong in stages.
The Terengganu Investment Authority
3. Firstly the attempt to hijack the Terengganu Investment Authority (TIA) money. Petronas pays 5% of its gross earnings to the Terengganu Government. Over the years their royalty has grown quite big.
4. Jho Low persuaded Najib to make the TIA into a sovereign fund for investment like the Kuwait Investment Fund but under Najib’s control. Appointments of staff were made by Najib without Terengganu’s knowledge. Terengganu agreed at first but when Najib decided to raise through bonds RM5 billion using Terengganu oil wells as collateral, the istana and the Government thought it was not right.
5. Terengganu requested that the issuance of the bonds be deferred. Najib went ahead. Terengganu accordingly withdrew as it cannot let its’ oil wells be put at risk.
6. Jho Low then advised Najib that the Federal Government should guarantee the loan. Strictly speaking such a matter should be discussed and approved by Cabinet. There is no evidence that a cabinet paper was prepared and presented for approval despite the amount being unusually big. In fact for a long time Cabinet was not aware of the activities of 1MDB.
7. To avoid scrutiny by officials, the loan was classified as off – budget i.e. outside the annual budget presented to and approved by Parliament. Off – budget spending can be made but usually only limited in amount. RM5 billion have never been borrowed by Government or any of its agencies. It should not be off-budget. It should get Cabinet approval first and then presented to Parliament. None of these procedures were followed.
8. It is not clear whether any Government department or agencies have scrutinised the terms of the loans. But the terms were very unfavourable to 1MDB and the Government.
9. Goldman Sachs which was entrusted with raising the loan was given;
i) Commission of 10%
ii) The interest rate was fixed at 5.9%
10. What this means is that of the RM5 billion borrowed 1MDB would get only RM4.5 billion. Goldman Sachs would get RM500 million as commission, an inordinately large sum.
11. But 1MDB would pay 5.9% interest on the whole of RM5 billion. Since it gets only RM4.5 billion the rate of interest on this amount would be 6.6% plus. Goldman Sachs need not pay interest on the RM500,000,000/- it got as commission.
12. Loans taken by Government or guaranteed by Government would normally carry 3% interest or less. But the 1MDB loan cost almost 7% interest i.e, about RM350 million a year or almost RM1 million per day.
13. Who approved such terrible terms for a loan to a government owned company? We would like to know who. There must be some documents with the signature of the approving authority. If not somebody needs to answer for this stupidity. Or is it abuse of authority.
14. But more loans were raised from local as well as foreign banks. In all RM42 billion were borrowed. It is not clear what the terms are. But interest on RM42 billion must come to almost RM3 billion a year. Unless the investment yield fantastic returns, the interest burden would sink 1MDB. In fact as everyone knows Ananda Krishnan had to make available RM2 billion to pay the interest. Is it a loan or a free gift? Later 1MDB had to sell shares or properties for USD1 billion (RM3.7 billion) in order to settle short term loan from a German bank.
15. 1MDB is effectively headed by the Prime Minister who is also the Minister of Finance. When loans of more than 100 million are raised for investment overseas Bank Negara has to approve. But the final approval must come from the Minister responsible. And the Minister responsible is also the effective head of 1MDB.
16. The best known investments by 1MDB were in the purchase of power plants and Government land as well as private land.
17. RM18 billion was spent to purchase IPP belonging to Ananda Krishnan, Genting Sanyen Power (now known as Kuala Langat Power Plant) and Jimah Energy.
18. The prices paid for Genting Sanyen and Ananda’s IPP were well above market price. 1MDB also paid RM6 billion for unpaid loans. The Jimah IPP was to put up another power plant. But 1MDB had no money to build this plant
19. Genting Sanyen and Tanjung Energy (now known as Powertek Energy Sdn Bhd) were nearing expiration of their licenses. Had 1MDB waited until the licenses expired, the price would be next to nothing.
20. Why 1MDB did not wait until the expiry of the license is a mystery. Genting and Ananda clearly made more money than they were entitled to. One estimate is that the high price netted the sellers an extra RM3 billion. Besides they are relieved of the loan of RM6 billion.
21. So not only is the borrowing costly but the high cost of investments will mean low returns. Why is 1MDB so stupid.
22. As stated above 1MDB is unable to get the IPP listed again. Who would want to own overpriced and obviously unprofitable power plant.
Purchase of Land
23. The land along Jalan Tun Razak was actually meant for an agency to build shops etc for Bumiputras. But instead the Government sold the 70 acres to 1MDB for RM320 million i.e. at RM 60/- psf. Land close by had been sold at RM7000 /-psf. 1MDB should pay at least RM3000 to RM4000 /- psf.
24. Government lost a huge amount of money from the sales. The question is why did the Government sell at such a low price. One cannot help thinking it is because the PM ordered the sale. If so it is wrong and it constitutes abuse of authority. The full value should be paid to the Government now.
25. Then 1MDB decides to sell a small part of the land at the price it bought the whole 70 acres of land. Payment was made by Tabung Haji even before the transfer of ownership was completed. Apparently 1MDB needed the money immediately.
26. The directors of 1MDB and Tabung Haji are the same people. They claim that they abstained from voting. But obviously it was not an arms– length deal.
27. If the Government could sell to 1MDB at RM60 /- psf, it should also sell at the same price to TH. But effectively it has used money saved by intending pilgrims to give enormous profit to 1MDB.
28. It is the same with the Sungai Besi airport land. 1MDB acquires it at the ridiculously low price of RM90 /- psf. The value of the land is at least RM2000 /- psf.
29. But 1MDB bought private land in Penang at a much higher price. Yet the land is not at the centre of the city, has more than 1000 squatters and has not obtained the Penang Government approval for development. Seems like 1MDB had overpaid the seller for useless land. Why?
30. 1MDB claims it has assets worth RM52 billion.
31. So far no explanation has been given as to how these assets are valued. How much is the value of all the power plants. And how much are the prices of land worth?
32. Future values after development may be big but billions of Ringgits must be invested before the property can be sold. After deducting cost, the return cannot be very big. The power plants and the land cannot be worth RM52 billion.
33. Even if this money is used to repay debts, the disappearance of billions of Ringgit must be recovered, or 1MDB should be charged for the loss.
Tuesday, June 9, 2015
1. I am intrigued by the ability of 1MDB to invest 42 billion Ringgit in so many businesses. Really I should be fully satisfied with how 1MDB expended the huge loan that it borrowed.
2. But unfortunately I am not. I am not, because the information came from the current CEO, Arul Kanda Kandasamy. And Arul has been caught lying quite a number of times.
3. Almost as soon as he took over management of 1MDB he announced that the money from Cayman’s Island has been returned. He said clearly and openly that he saw the cash i.e. one billion dollars in cash. Then he said it was statements. What are the statements? Anyway in the end the bank said no cash and only documents were deposited in it and the documents carried false signatures.
4. He must have told the Prime Minister about this fantastic pile of dollar notes so the Prime Minister answered the question in Parliament that the cash is in the bank in Singapore. It cannot be brought back because Bank Negara asks too many questions. The Finance Minister must approve or disapprove all Bank Negara strictures or approvals.
5. Then the banks denied that the cash is in the bank. Embarrassing. The vision has disappeared. No. It is not cash. It is documents. No, it is units. What units? Dunno. Which bank? Not clear. The mystery deepens.
6. So when Arul announced the investments of 42 billion Ringgit, could it be something else that he saw which was not there. And do people use borrowed money to pay tax? What tax? No profit was declared but tax was paid. How much? Cost of managing 1MDB run into billions!
7. In any case, many names which are known to have received money from 1MDB are not mentioned. Lots of money went to Hong Kong companies with funny names.
8. Has nothing been paid to Petro Saudi, to Jho Low, to Brazen Sky and others. Jho Low denies but why has he not proven that he did not receive US 260 million (RM 988 million) from 1MDB to buy a bank.
9. Arul had lied before. It is not inconceivable that on the 42 billion Ringgit Arul may be lying again. Where a chunk of the 42 billion Ringgit went is still questionable.
10. I don’t think we can resolve the problem of where the 1MDB money has gone through four-eyed meetings. Najib can resolve through proving beyond reasonable doubt that no money has disappeared from the 42 billion borrowed.
11. The intention of 1MDB I presume is to make money for the Government. Show how much profit the Government has made since 2009. Why do you have to borrow money to pay interest on the debts?
12. Why cannot the power plant shares be listed?
13. Why does 1MDB pay only 60 – 90 Ringgit for Government land which it now wants to sell at 2000 – 4000 Ringgit psf? And now the land bought by Tabung Haji has been sold to some Indonesians at a loss. The loss will be borne by the pilgrims.
14. Actually there are many questions that the Prime Minister can answer not to me, but to the public. The money does not belong to me alone. From the question asked by so many people they want to know where their money is.
15. The money belongs to the people. It is the duty of the police, the anti-corruption agency to investigate the complaints and the reports that has been made – including by Bank Negara. But the agencies have not investigated.
16. There is a climate of fear which restrains them from investigating. For as long as the Prime Minister is the Prime Minister, investigating things involving him is not going to be really possible. It is necessary that the PM relinquish his position and authority if the Auditor General, the Public Accounts Committee or even a Royal Commission is to reveal the truth.
17. I went to the “Nothing to Hide” forum hoping to hear explanations from Dato Sri Najib and to ask questions. But it was cancelled because of security reasons.
18. I watched a video clip of what happened. There was no threat to security except for Ali Tinju making a lot of noise. It is obvious he wanted the meeting to be cancelled. We know who he is in favour of. It is a pity. Najib could have explained everything and people like me would be silenced.
Friday, June 5, 2015
1. A friend visited me in my office recently. I had helped him a lot when I was PM not with money or jobs, but by smoothening bureaucratic processes in the way of his projects. As a result he became a very successful educationist and was able to expand overseas. I regarded my help as essential as the bureaucrats can be unnecessarily dilatory or even obstructive. I do this for everyone and they are all very grateful. My friend was especially grateful.
2. Off and on he would drop in my office to discuss current issues. He worried about Najib’s Government policies and performance. He urged me to do something.
3. But when he dropped in this time he seemed somewhat changed.
4. He kept on urging me not to “attack” the PM. I explained why I am doing so. But he persisted in urging me to desist from my efforts at questioning the leadership regarding the current financial scandal.
5. He warned that if I continue I would lose my legacy. I told him what people think of my legacy, if there is any, is not important. I am concerned at what is happening in the country. Our good reputation is being eroded.
6. He repeated several times that I would lose my legacy. I really appreciated his concern. He is a friend and I felt he cared for me.
7. We parted as friends.
8. But now I understand better why he talked about my losing my legacy. He has been given the task of demonising me, of destroying what he calls my legacy. I think he and his boss believes that if I become unpopular then my condemnation of the shenanigans involving 1MDB would be ignored by people.
9. So we are seeing now a new and more aggressive campaign to demonise me and to show how much the PM is supported by the people. Clearly large sums of money are being spent on this campaign. My friend is now installed in the Prime Minister’s Office and is working hard to cover up the wrong-doings of 1MDB. The first pages of the mainstream media now carry explanations on how the borrowed funds were spent. They add up neatly to 42 billion Ringgit. Before criticisms were just ignored. A policy of elegant silence was followed. Now Najib has been advised to answer to explain. However, he lost an opportunity to explain when he did not turn up for for the “Nothing to Hide” forum.
10. But there really can be no explanation on the disappearance of the money supposedly brought back from Cayman Islands – six billion US Dollars. No explanation can be made on the denial by the Swiss bank that it received money from 1MDB. No explanation on Arul’s claim that he saw the cash and the PM explaining there was no cash. Now the cash has become units. What units? No explanation also on the inability to pay interest of 2 billion until Ananda donated or loaned 2 billion whatever. Nor is there any explanation as to why 1MDB needs investments of USD1 billion by IPIC to pay debts to Deutsche Bank when 42 billion investments have been made. Is there no returns on the investments? And many other questions remain unanswered.
11. My ex-friend will have to do better at demonising me if he is to earn titles etc.
Thursday, June 4, 2015
1. The 2nd Finance Minister has presented Cabinet with a restructuring plan for 1MDB which will solve all it’s problems. I would like once again to repeat that repayment of the debt does not absolve the borrowers from responsibility for losing the money in the first place. The money is not lost through bad businesses but has simply disappeared. Somebody knows how the money disappeared and who has the money now. But that somebody is not telling.
2. Now the restructuring process.
3. IPIC is said to have invested 1 billion U.S. dollar in 1MDB. It is not a loan as claimed by the 2nd Finance Minister. Certainly it is not a free gift. What does IPIC get for its 1 billion dollars from 1MDB. It must be the assets of 1MDB.
4. IPIC may be putting in another 3 billion USD. The money which 1MDB gets will be used to repay the German Bank which had lent approximately 1 billion USD The additional 3 billion USD will be for transferring the landed assets of 1MDB.
5. 1MDB had acquired Government land worth between RM4000/- toRM7000/- psf at RM60/- to RM90/- psf. Actually the price paid by1MDB for Government land represents or reflects an abuse of authority. The right thing to do is to pay the market price of the land before it is developed or disposed of.
6. If IPIC pays 4 billion USD to 1MDB, effectively IPIC become owner of the assets of 1MDB.
7. 1MDB actually gets nothing as the money from IPIC will go towards paying the interest and loans of 1MDB to reduce the total loans of RM42 billion to a smaller amount.
8. On this smaller loan 1MDB would still have to pay interest until money is found to pay off the principal.
9. So how does this restructuring benefit 1MDB. It would:
I. Lose control of 1MDB to IPIC
II. Any development of the land would accede to IPIC.
III. The deal would result in the Malaysian Government losing billions of Ringgit unless market price is paid for TRX and Bandar Malaysian land.
IV. 1MDB would still have to pay interest on the balance of the loan and eventually billions of Ringgit to settle the loans. Having lost the most valuable part of its assets, how does it raise money.
V. 1MDB would still have to sell off the power plants. Since it paid higher than market value for the plants it will not be able to list it or sell at the purchase price. It will have to lose at least 3 billion Ringgit simply to get rid of the plants.
10. So far there is no evidence that money amounting to 4 billion dollars (14 billion Ringgit) from Cayman Islands is in Singapore. That money has disappeared unless 1MDB can show there are “units” with value in money in Singapore. The units must be converted to real money to be credible.
11. The restructuring plan presented by the 2nd Minister of Finance cannot erase the problem of 1MDB, cannot erase the fact that money borrowed by 1MDB has disappeared, that the Government of Malaysia will lose billions of Ringgit. Part of the loan may be redeemed but a very substantial amount will remain. Certainly the restructuring will not result in the lost money being recovered.
12. There are too many evidence of cover-ups by politician and civil servants. When Najib is defeated and I believe he will, in the next election, there will be no stopping the legal actions which must follow.
13. I hope the restructuring will help but unless the lost money is returned, paying off debts will absolve no one.
Pendaftaran Keahlian PARTI PRIBUMI BERSATU MALAYSIA
Deklarasi Rakyat - Citizens Declaration Part 2/3 Majlis Bicara Negara Bersama Tun M di Hotel Tower Regency, Ipoh