Thursday, June 18, 2015

THE 1MDB REPLY


As posted by Dr. Mahathir Mohamad at Che Det on 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 Golden Sachs terms for the bond issue. Show that Golden 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.