On Monday night, 1Malaysia Development Bhd’s (1MDB) Chief Executive Officer, Arul Kanda Kandasamy, told a forum in Johor Bahru that the company‘s success should be measured through the realisation of the construction of its two mega projects, namely the Tun Razak Exchange (TRX) and Bandar Malaysia.
“This will put to an end to the various allegations being continuously hurled by the opposition towards the company,” he said.
He also said the community can see and evaluate for themselves the active ongoing development around the TRX to date and the attention it is receiving from local and foreign investors.
“This is what I want to portray. 1MDB is not bankrupt and still capable of of repaying its debt, while developing its available assets. This is an undeniable fact.
This fairy tale must be one of the most blatant lies that Arul Kanda is trying to hardsell to the Malaysian public.
Anyone travelling through Bandar Malaysia or the Sungai Besi military airbase today will find that it is a flat piece of land without an inch of development.
In 2015, 60% of Bandar Malaysia was sold to a consortium led by Iskandar Waterfront Sdn Bhd for RM7.41 billion but the deal was terminated last year because the consortium failed to meet their financial obligations.
Instead, the Ministry of Finance (MoF) has been travelling around the world to seek a new Master Developer. However, there has been no takers despite the Treasurer-General Tan Sri Irwan Serigar giving repeated assurance by that there will be an award “coming soon” since last July.
What success is Arul Kanda talking about? Bandar Malaysia is today, a testimony of 1MDB’s complete failure despite having been awarded the 495 acres of land at a ridiculously cheap price.
Worse, due to 1MDB’s practical insolvency and inability to service its debts, both projects have been handed over to the Ministry of Finance since a year ago. As a result, MoF has been forced to assume the RM2.4 billion Bandar Malaysia sukuk debt.
Arul Kanda, who loves to ask us to refer to the PAC Report, himself chose to ignore the fact that the Auditor-General discovered that more than 90% of the RM2.4 billion sukuk was never used for the development of Bandar Malaysia, or for that matter TRX.
For TRX, the project is clearly faring better. However, Arul Kanda failed to highlight to similarly point out that 1MDB had purchased the TRX land at a ridiculously cheap RM64 per square feet (psf) and sold them to government-related institutions for ridiculously expensive prices. Tabung Haji purchase a parcel of TRX land in 2015 at more than RM2,700psf while, the subsidiary of LTAT, Affin Bank purchased another parcel for more than RM4,500psf.
Even for 3.4 acres of land that 1MDB had previously sold to a private property developer, Indonesian Mulia Property Development for RM665 million, the MoF recently had to acquire 51% stake in the project to develop The Exchange 106 skyscraper — poised to be the tallest building in Southeast Asia.
Regardless, the fact that these projects are being bailed out by the MoF means that they are no longer 1MDB projects! Hence for Arul Kanda to attempt to claim credit for a project that is no longer 1MDB’s is really a stretch beyond anyone’s imagination.
Deputy Minister of Communications and Multimedia, Datuk Jailani Johari said any information related to 1MDB that has not been verified by the Government is considered fake news. The big question now is, will Arul Kanda be charged?