Another opposition lawmaker questions MoF's intention to convert RM875 mil debt to equity in two state-owned units

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KUALA LUMPUR (Nov 27): Opposition lawmaker Wong Chen has today questioned the Ministry of Finance's intention to convert its RM875 million loans to Malaysia Debt Ventures Bhd and Prasarana Malaysia Bhd into shares in the two corporations.

The Kelana Jaya MP said the exercise - although normal between corporations - was "unusual" in this case as both parties are fully owned by the government under the ministry, which is better known as MoF. 

Even more "intriguing" was the fact that MDV, to which MoF has loaned RM400 million, and PMB, which has been loaned RM475 million by MoF, are not entities focused on profit-making but rather to facilitate development.

MDV gives out loans for internet start-up companies while PMB is in mass public transportation.

"How will the government ever recover the RM875 million loans since MDV and PMB are not for profit? They will not likely ever pay any dividends back to MoF," he told reporters in Parliament today.

He slammed the exercise as an attempt at "creative accounting to artificially reduce government debts". 

He also demanded that the government be more transparent and to reveal the quantity of debts that had been converted to equity in a similar manner in the past decade, as well as the subsequent dividends - if any - that were from the exercise.

MoF had on Monday (Nov 24) listed two separate motions in the parliamentary order paper to enable it to make the debt for equity swap in both MDV and PMB.

Wong is the second MP to raise this matter. Pandan MP Rafizi Ramli had also raised the issue on Monday.

Despite their concerns, the motions were later passed by the Dewan Rakyat at around 8.50pm.