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Remarks made by Lim Guan Eng to key DAP Terengganu branch leaders during a closed door meeting in Kuala Terengganu on Thursday, 16th October 2008: 

The twin scandals of the Maybank RM 8.25 billion acquisition of PT Bank Internasional Indonesia (BII) and RM 2.32 billion purchase of 12 Eurocopter's Cougar helicopters have deprived needed funds to wipe out poverty in Malaysia   

The twin scandals of Maybank's RM 8.25 billion acquisition of PT BII and RM 2.32 billion purchase of 12 Eurocopter's Cougar helicopters have deprived needed funds for infrastructure works such as drainage to prevent flash floods of for social programs that uplift living standards and wipe out poverty in Malaysia.

Maybank bought at a price that is more than 65% higher than the prevailing market price or 4.3 times BII's book value compared to the current market valuation of Indonesian banks at a maximum of 2.7 times. Singapore state investment company Temasek Holdings Pte. Ltd. and South Korea's Kookmin Bank were so desperate to sell their 56% stake in BII that they were willing to:-

not only forgo a RM 483 million deposit by Maybank that they could have forfeited if Maybank had not proceeded with the deal; but also

give a further 15% discount of RM 758.9 million even AFTER the deal has been closed?

By proceeding ahead with the RM8.25 billion deal on the basis it was a commercial decision, Maybank has acted irresponsibly and even unprofessionally. Why not cut losses, lose face by admitting its mistake and forfeit its RM 483 million deposit instead of recording an instant loss of more than RM 4 billion from the RM 8.25 billion deal?

Similarly purchasing 12 Eurocopter's Cougar helicopters for RM 2.32 billion when the the same sum can purchase 30 Kazan-M172 helicopters from Canada's Kelowna Flightcraft Ltd. which fulfills almost all the specifications required by the armed forces. The Defence Ministry would only need to pay RM 898 million if it had bought 12 Kazan instead of Cougar helicopters, a cost overrun of RM 1.42 billion.

Would not these sums of money amounting to nearly RM 10 billion that can be saved either by not proceeding with the RM 8.25 billion deal to acquire BII or by buying the cheaper Kazan helicopters at RM 1.42 billion less, be better utilised to help the poor? I am sure that with RM 10 billion, not only can we wipe out hard-core poverty but even poverty of Sabah which has the highest poverty rate in the country at 23.4 %.

DAP supports efforts by the Federal government to increase the penetration rate of broadband users from the present 15% to 50% in 2010, but this is no excuse for a RM 11.3 billion High Speed Broadband (HSBP). Even supporters of the BN government have slammed the RM 11.3 billion has much too high and could be done at lower costs saving billions of ringgit. Penang has just launched our free wireless Penang initiative to be the first wifi state in the country where wireless access will be free and wimax services will be affordable cost. Despite this free wireless initiative, which is hoped to be implemented in 2 years, there is no cost at all to the state government.

DAP regrets that no leader from BN especially the new leadership in MCA or Gerakan has highlighted this controversy which is clearly against public interest. This goes to show that MCA and Gerakan and UMNO have not learnt the lessons of the political tsunami of 8 March general elections that the public will no longer tolerate shady deals.

It is such shady deals that have crippled Malaysia's anti-corruption efforts causing Malaysia to tumble in the rankings of the Transparency International's Corruption Perception Index of No. 37 in 2003 to No. 47 this year. This lack of confidence is reflected in a capital flight of RM125 billion (S$53 billion) in the first half of the year as compared to foreign direct investments of only RM31 billion.

Unless BN leaders practices CAT- competency, accountability and transparency that ensures public funds will not be used for private interest of the few, only then can we restore public and investment confidence in good governance and integrity.


* Lim Guan Eng, Penang Chief Minister Penang & DAP Secretary-General