Malaysia

DAP says UEM, MRT, YTL deals show NEM ‘nothing but rhetoric’

By Melissa Chi
October 06, 2010

Pua: In fact Gamuda has already told equity analysts that it is 80 per cent certain of being awarded the bulk of the project, and this would be because they are the only commercial party who have been in consultation with the Government as well as Pemandu to develop the entire plan for the project.Pua: In fact Gamuda has already told equity analysts that it is 80 per cent certain of being awarded the bulk of the project, and this would be because they are the only commercial party who have been in consultation with the Government as well as Pemandu to develop the entire plan for the project.KUALA LUMPUR, Oct 6 — The DAP suggested today that the Najib administration’s commitment to open competition under the New Economic Model (NEM) was “nothing but rhetoric,” citing as examples of patronage the MRT project, the proposal by Asas Serba to take over highway concessions, Tan Sri Syed Mokhtar Al-Bukhary’s bid to buy UEM and YTL’s involvement in the high-speed rail link to Singapore.

“Should the government decide to proceed with any of the above projects or privatisation of assets without any form of open competition, it will not only reflect the fact that the NEM is nothing but rhetoric, but it has no sincerity in wanting to promote “dynamic and efficient markets” or isn’t serious about “tapping new sources of growth,” the Pakatan Rakyat (PR) party’s national publicity secretary Tony Pua said in a statement today.

The Malaysian Insider reported yesterday that state asset manager Khazanah Nasional Berhad is looking at tycoon Tan Sri Syed Mokhtar Al-Bukhary’s financial track record as it mulls his offer to buy the UEM Group Bhd, which runs the profitable Plus expressways concessionaire, for the amount of RM15.6 billion.

UEM has substantial stakes in 8 public listed companies, and is prized for its 38.5 per cent ownership of PLUS Expressways Bhd, 28.7 per cent of Time dotCom Bhd, 32.0 per cent of Faber Group Bhd and 77.1 per cent of UEM Land Bhd.  It also owns the Penang Bridge Sdn Bhd as well as Cement Industries Malaysia Bhd.  As at the end of 2009, the net assets of UEM Group Bhd amounted to RM12.3 billion.

The Malaysian Insider also reported on October 4 that Syed Mokhtar had asked the government to sell 1,200ha of Rubber Research Institute (RRI) land in Sungai Buloh and the police training centre in Jalan Semarak.

The government is now considering the award of Malaysia’s largest infrastructure project to date, that is the Greater KL Mass Rapid Transit (MRT) system which is expected to cost up to RM46 billion with a Gamuda Bhd and MMC Bhd joint venture being touted as the “winners” of the project.

“In fact Gamuda has already told equity analysts that it is 80 per cent certain of being awarded the bulk of the project, and this would be because they are the only commercial party who have been in consultation with the Government as well as Pemandu to develop the entire plan for the project.  “Similarly, YTL Corporation Bhd is expected to “win” the project to develop the high-speed train service between Kuala Lumpur and Singapore due to its involvement with Pemandu at the “laboratory” stage of the ETP,” Pua said today.

Deputy Prime Minister Tan Sri Muhyiddin Yassin had also admitted that the Cabinet is mulling over the RM50 billion proposal by Asas Serba whom Pua claimed was linked to Tan Sri Halim Saad to take over all highway concessions in Malaysia. 

Pua said the proposal should have been rejected outright for it was “completely without basis, merit and it was completely unsolicited”.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed had said that getting a tender through direct negotiation is “unfair”, to Malaysian students at the University of Melbourne on October 2.

He said that only high-security projects involving the military and defence were exempted from open tender.

But the slew of government assets and projects being directly negotiated by the administration which were cited by Pua today appeared to contradict Mustapa’s assertion.

Mustapa had said in Melbourne that “open tender means more competition, greater transparency, no corruption. And that’s what the public wants. And we are listening to the public.”

Pua also pointed out that Prime Minister Datuk Seri Najib Razak  had emphasised that “we can no longer tolerate practices that support the behaviour of rent-seeking and patronage.”

“The direct and opaque award of these contracts to these connected parties flies in the face of the Prime Minister’s call for ‘inclusiveness’ and to eradicate ‘rent-seeking and patronage’,” he said.

He urged the prime minister to ensure and reiterate in the upcoming 2011 budget announcement that “all government projects, large and small as well as all government owned assets which are to be privatised will be tendered openly and competitively instead of being awarded on a directly negotiated basis”.