Friday 29 Mar 2024
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(May 15): The Penang Pakatan Rakyat government said it never sold a single inch of land on Pulau Jerejak in response to criticism that it was selling the small island off the southeastern coast of the island.

Chief Minister Lim Guan Eng said the state government was trying to recoup the millions of ringgit it lost in a deal made years ago by the previous state administration in a joint venture with UDA Holdings Berhad.

The state under the Barisan Nasional (BN) administration had entered a joint venture called Tropical Island Resort (TIR) with UDA via state-investment arm Penang Development Corporation (PDC).

UDA holds a 51% stake while PDC owns the rest of the company, which is involved in the development of the island.

Lim said the land allegedly sold was the 32.4ha on the island which the previous administration had leased to TIR for 60 years from 2002 to October 2062.

He said the exco had approved the lease in January 2001 after TIR paid the first instalment for the land premium, although it was against convention under Section 180 of the National Land Code that stated that the grant could only be issued after the full premium was paid.

"The full premium was RM12.95 million with a 4% annual interest rate. TIR did not pay the remaining RM10.6 million due to its poor financial performance until 2011, following pressure from the current administration.

"This was a RM30 million scandal because the land premium was so cheap and TIR did not even pay the full premium until we pressured the company," he told a press conference at the Penang legislative assembly this morning.

Lim said PDC was now selling its stake to UDA and also trying to recoup the lost investment cost of RM15.435 million and RM3.6 million in loans out of the deal.

“TIR's paid capital was RM31.5 million. PDC's investment cost based on its 49% equity is RM15.435 million. In December 2007, PDC gave a loan of RM3.41 million to TIR to cover the operation cost. Inclusive of interest, the amount is RM3.6 million.

"We are trying to get back over RM20 million from joint venture, including the value for the land in TIR's possession according to the market price. Is it wrong of the state to want to get the money back? We are not selling land," he said.

The issue was raised earlier this week at the state legislative assembly after BN's Teluk Bahang assemblyman Muhamad Farid Saad asked the state about a rumour that a housing project of some 10,000 units was in the pipeline for Pulau Jerejak. – The Malaysian Insider

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