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Chan Kong Choy should follow Chua Soi Lek’s brave example in taking responsibility for his actions by admitting that Chan exceeded his ministerial powers in signing financial undertakings granting government guarantees to the contractor in the RM 4.6 billion Port Klang Free Trade Zone (PKFZ) scandal


Press Statement

by Lim Guan Eng



(Petaling Jaya, Wednesday): The statement by Johor MCA Deputy Chair and Labis MCA Division Chair Tan Kok Hong that Health Minister Datuk Seri Dr Chua Soi Lek was “stabbed from behind by certain parties who want to destroy Chua politically” confirms DAP’s suspicions that the Soi Lek sex DVD scandal is part of the dirty internal power struggles within MCA. Tan did not ask the police to act but instead pointedly urged MCA to act against those involved in the production and distribution of the DVDs.

It is widely known that Chua does not see eye to with MCA’s top leadership. For this reason DAP leaders have taken the correct decision to distance itself from this Soi Lek sex DVD scandal as we do not want to be used or exploited for the benefit of those involved in MCA internal power struggles. DAP would not be distracted by this private scandal from our focus of adopting public policies that makes a difference in the lives of ordinary Malaysians particularly 3 critical issues affecting the people such as:-

• Sharing our country’s wealth and Petronas profits with ordinary Malaysians by reducing the economic pain caused by rising prices with the government in a state of denial, insisting that inflation in 2007 is at only 2% when it is running at more than 20%.

• Worsening crime index rising by 6.7% for the first nine months of 2007 where Malaysians do not enjoy the four basic rights of security to live, work, study and play in a safe environment; and

• Respect the rights and dignity of all Malaysians as first-class citizens by ensuring political equality, equal opportunity and socio-economic justice regardless of race and religion.

Labis Barisan Nasional chairman Datuk Sulaiman Taha even praised Dr Chua for being a brave leader to admit the deed and openly apologise for his mistake. As a brave leader, Dr Chua should know what is the next honourable step to take. However this courage by Chua to admit his misdeeds does not appear to extend to MCA Deputy President and Transport Minister Datuk Chan Kong Choy who has refused to account for the RM 4.6 billion Port Klang Free Trade Zone scandal.

DAP calls on Chan to follow Chua’s brave example in taking responsibility for his actions by admitting that Chan exceeded his Ministerial powers in signing financial undertakings giving government guarantees to the contractor in the RM 4.6 billion Port Klang Free Trade Zone scandal. Hanky panky in the PKFTZ begin with the purchase of 1,000 acres at astronomical prices despite objections by the Finance Ministry and the Attorney-General’s Chambers. Such objections were validated by questionable cost-overruns to RM 4.63 billion from the original estimate of RM 1.1 billion.

The MCA Presidential Council emergency meeting to discuss the Chua Soi Lek sex scandal should also discuss Chan Kong Choy’s unlawful actions of signing financial undertakings resulting in the RM 4.6 billion PKFTZ scandal

Worse Chan and the Transport Ministry unlawfully issued four “letters of support” which were used by the turnkey contractor - Kuala Dimensi Sdn Bhd (KDSB) - to raise RM 4.6 billion bonds and get an AAA rating from the Malaysia Rating Corporation Bhd for the PKFTZ project. Why should the public bear responsibility for a RM 4.6 billion PKFTZ bailout despite earlier assurances that the PKFZ project would be feasible, self-financing and would not involve a single ringgit of public funds.

To-date Chan Kong Choy had refused the answer the five simple questions posed by Parliamentary Opposition Leader Lim Kit Siang in and outside Parliament.

1. Was it true that when the Port Klang Authority and the Transport Ministry insisted on buying the 1,000 acres of Pulau Indah land for PKFZ at RM 25 PSF in the face of strong objection by the Attorney-General’s Chambers and the Treasury which had recommended that the land be acquired at RM 10 PSF. And that Cabinet had given its approval of RM 25 PSF subject to two conditions which were not complied by Chan namely: (i) categorical assurance by the Transport Minister that the PKFZ proposal was feasible and self-financing and would not require any public funding; and (ii) that every RM 100 million variation in the development costs of PKFZ would require prior Cabinet approval.

2. The first condition was breached when the PKFZ project ballooned from RM 1.1 billion to RM 4.6 billion requiring government intervention and bailout while the second condition was breached with the original PKFZ development costs of RM400 million ballooning to RM 2.8 billion without any prior Cabinet approval ever been sought for every RM 100 million increase in development costs.

3. The Transport Minister had unlawfully issued four Letters of Support to Kuala Dimensi Sdn Bhd (KDSB), the PKFZ turnkey contractor — to raise RM 4 billion bonds, which were regarded as government guarantees by the market. The Transport Minister had no such powers to issue financial guarantees committing the government, as it could only be issued by the Finance Minister and only after Cabinet approval. The first Letter of Support was issued by the former Transport Minister, Tun Dr. Ling Liong Sik on May 28, 2003, which was Liong Sik’s last day as Transport Minister while the other three were issued by Kong Choy.

4. Whether it wasn’t true that in recognition that the four unlawful “Letters of Support” of the Transport Minister had nonetheless given implicit government guarantee to the market that the Cabinet had in mid-year to give retrospective approval for the unlawful and unauthorized four Letters of Support by the Transport Ministers in the past four years creating RM 4.6 billion liability for the government in the bailout of PKFZ.

5. Why no action had been taken against the Transport Minister, both Liong Sik and Kong Choy, as well as the government officials responsible for the unlawful issue of the four “Letters of Support”. Kong Choy explanation that he did not know that only the Finance Minister can issue such financial undertakings and that he had no powers as Transport Minister to issue such Letters of Support is a lie when he was a Deputy Finance Minister Deputy Finance Minister for close to four years from December 1999 to June 2003.

Causing losses to the public resulting in the RM 4.6 billion PKFTZ scandal would in legal and financial terms be a bigger offence than that committed by Chua Soi Lek. In calling for an emergency Presidential Council meeting to discuss Chua’s sex scandal, MCA President Datuk Seri Ong Ka Ting should also put his priorities right by giving equal emphasis to public interest in also discussing the unlawful actions of Chan Kong Choy that has caused huge public losses in the RM 4.6 billion PKFTZ scandal.


* Lim Guan Eng, Secretary-General of DAP

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