Thursday, June 18, 2015

Gov't guaranteed loans now total RM172 billion

10:43AM Jun 18, 2015
PARLIAMENT The government's guaranteed debts as at the end of 2014 came to a total of RM172 billion, or 14.7 percent of the gross domestic product (GDP), the Finance Ministry says.

"As at the end of 2014, the total guarantees given by the government on loans came to RM172 billion," the ministry said in a parliamentary written reply to Fauzi Abdul Rahman (PKR-Indera Mahkota).

"The guarantees were given especially to public entities to facilitate infrastructure projects, such as DanaInfra and Prasarana, which involved infrastructure construction and public transport operations.

"The government, from time to time, gives guarantees to statutory bodies and government-linked companies for the purposes of loans to fund projects of public interest," the ministry said in its reply to Fauzi (photo), issued yesterday.

It argued that the guarantees are allowed under the Loans Guarantee (Bodies Corporate) Act 1963.

Fauzi had asked for the total loans borne by the government, including loans given in the form of "letters of support", "letters of guarantee" and "letters of comfort".

He said it was common knowledge that letters of support are a practice of the ruling government to secure loans for the government-linked companies.

The media has widely reported on letters of support issued by the Transport Ministry in the controversial case of the Port Klang Free Zone development and by the Finance Minister for the debt-laden 1Malaysia Development Bhd (1MDB).

"According to records, one 'letter of support' was for the guarantee of US$3 billion," the ministry said, without naming the borrower.

Lawmakers believe that in this instance, the Finance Ministry was referring to the 1MDB subsidiary, 1MDB Global Investment Ltd, which raised a US$3 billion bond.

"Its performance in repaying the loan is good and on schedule, without any delay," the ministry said.
~ Malaysiakini

1 comment:

Winston Yap said...

Very, very soon, this country will be another Greece!!!!!!