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Old 30-06-2015, 07:13 PM   #4
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Najib’s supporters don’t understand 1MDB’s ‘shady business’, says Dr M
TODAY reports: In his latest blog post, Malaysia's former Prime Minister Mahathir Mohamad says a “large amount of money had disappeared” after state investment vehicle 1Malaysia Development Bhd borrowed RM42 billion to dabble in “shady businesses”.

POSTED: 30 Jun 2015 08:44

KUALA LUMPUR: Prime Minister Najib Razak’s supporters do not seem to understand that state investment vehicle 1Malaysia Development Bhd (1MDB) had borrowed RM42 billion (S$15 billion) to dabble in “shady businesses”, resulting in a loss of money, said former Prime Minister Mahathir Mohamad on Monday (Jun 29).

In his latest blog post, Dr Mahathir said that in the process, a “large amount of money had disappeared”.

Referring to a recent announcement in the London Stock Exchange that International Petroleum Investment Company (IPIC), backed by the Abu Dhabi government, would undertake some of 1MDB’s debts in return for a transfer of assets, the former Premier said no mention had been made of which 1MDB asset would belong to IPIC.

“If it is the power plants or the land (that 1MDB had purchased using public funds), it would mean that these assets are no longer 1MDB’s to sell. So how does 1MDB recover the RM42 billion it has borrowed (from the government)?” he asked.

Dr Mahathir noted that the entire restructuring of the beleaguered state investment vehicle seemed to be about selling off assets to clear the loan.

1MDB has maintained that the value of its assets can offset the RM42 billion debt, though its cash flow struggles have led to a restructuring exercise.

“The money is to come from the sale of TRX (Tun Razak Exchange) and Bandar Malaysia land. 1MDB paid an extremely low price for this land. But can 1MDB do so?” he asked.

Dr Mahathir added that the money borrowed by 1MDB had been used to buy Independent Power Producer (IPP) at inflated prices.

1MDB is currently being investigated by the Auditor-General and the bipartisan parliamentary Public Accounts Committee (PAC) over its dealings.

Commenting that on the recent arrest of a PetroSaudi International executive who had tampered and leaked email correspondence between the company and 1MDB, Dr Mahathir said the arrest had no bearing on the fact that the two companies had entered a “worthless” joint venture.

He said the arrest of the executive, Mr Xavier Justo, by the Thai authorities on charges of blackmail did not change the fact that 1MDB had entered into a lopsided deal with PetroSaudi and overpaid for energy assets.

“Even if Justo had tampered with the emails, it doesn’t alter the fact that 1MDB had forked out US$1.9 billion (S$2.57 billion) for the joint venture with PetroSaudi, which within six months became so worthless that it was aborted,” Dr Mahathir wrote.

He also ridiculed those who were demanding an apology for the criticism of 1MDB following Mr Justo’s arrest.“Some people are very excited about Justo. Now, they say the critics of the Prime Minister should apologise. Apologise for what?” Dr Mahathir said.

“The fact remains that vast amounts of money have disappeared. Can Justo bring all the money back?” asked the former Premier, who has been outspoken against the failings of 1MDB, saying Mr Najib should step down over the scandal.

Dr Mahathir was responding to comments on Monday by Second Finance Minister Ahmad Husni Hanadzlah, who said the Justo case had much impact on 1MDB.

“Before (the arrest), 1MDB was seen as a ‘fragile’ company involved in scandals and facing various ‘online’ accusations,” said the minister.

“With the arrest of Justo, and based on what he has said, it is clear that the various issues concerning 1MDB did not arise and that it was on the right track,” he added.

Read the original report on TODAY here.

-TODAY/al
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