…The first signs of impending problems surfaced in 2003 when the Auditor-General in his annual report remarked that the PKA did not have money to fulfil its obligations on the project. PKA, however, repeatedly assured the government that the project would be self-funded without federal assistance and this was reiterated by then transport minister Datuk Seri (now, Tun) Dr Ling Liong Sik.
With its reserves of about RM500 million dwindling, there was an urgent – albeit futile – attempt at a government bail-out.
Bordering on insolvency, and in a desperate attempt to save the sinking ship, PKA sought soft loans of up to RM4.6 billion from the government.
When the project was already in financial trouble in mid-2005, it asked the Treasury for grants and a soft loan at an interest of 4% per annum with a six-year moratorium. However, what was not said was how PKA would find the money to repay the loan after the six-year period.
With almost zero reserves, PKA would have been hard-pressed for income to keep its end of the bargain, should the government approve the loan.
Industry sources said an idea was mooted to set up a Malaysian Ports Commission to collect levies from all ports to repay the government. This was despite assurances from ministry and PKA that the project will be self-financed.
Source: The Sun
Names so far:
Ling Liong Sik – former MCA president