This article first appeared in The Edge Financial Daily on June 29, 2018

KUALA LUMPUR: TRX City Sdn Bhd (TRXC) chief executive officer Datuk Azmar Talib said he was in the dark when some RM3 billion intended for the company’s Tun Razak Exchange project was transferred to 1Malaysia Development Bhd (1MDB) between mid-2012 and early 2017.

“What happened beyond TRX City, I wouldn’t know. We were under 1MDB so all financial matters were managed by 1Malaysia Development Bhd (1MDB) … and all those money was secured for the TRX project and they managed the thing and they were supposed to give the money to us when we need it.

“At the same time, I have done my level best and ring-fenced about RM2.4 billion worth of money for the TRX project,” Azmar said when asked about the alleged embezzlement.

The funds he ring-fenced, he said, were initial investments the company received from investors, but did not elaborate. TRX City, a unit of the ministry of finance, is the project owner and master developer of both TRX and Bandar Malaysia. It was formerly a subsidiary of 1MDB.

Earlier this week, TRX City announced it had lodged a police report that RM3 billion had been transferred from TRX City to 1MDB, and that the transfers were made between mid-2012 and early 2017, based on instructions from 1MDB and were diverted from their intended use.

Meanwhile, Azmar also said the new government’s announcement of support for TRX and its agreement to inject an additional RM2.8 billion into TRX City to complete the project has given a boost of confidence to both the local and foreign investors.

And one way to ensure that misappropriation of funds does not happen again is through the receipt of the money in stages, he said.

“Bear in mind that the RM2.8 billion [is] meant for the infrastructure, which will be completed by 2024. We will get the money in progress, as and when we require,” Azmar said.

“The outlook for TRX remains strong, with the renewed confidence in Malaysia post-GE14. [Prime Minister] Tun Dr Mahathir Mohamad has assured that Malaysia will continue to be an open economy that welcomes high quality FDI (foreign direct investment) to drive economic growth. This has been positively received by investors,” said Azmar.

“I’ve spoken to investors, both foreign and local, who are keen to be part of TRX. They have expressed their confidence in the government’s pro-business stance and direction, and the future prospects of Malaysia,” Azmar told a media briefing on the updates of the project yesterday.

“We’re looking at a few parties [who are keen] to invest in TRX. However, we can’t reveal who they are as we’re still in negotiations,” he added.

The new government’s commitment to inject another RM2.8 billion into the project has also boosted investor confidence and bolstered the company’s capacity to deliver all aspects of the development.

So far, the Malaysian government has injected about RM3.69 billion into TRX City for infrastructure works, bringing the total funding from the government to RM6.5 billion.