The Sarawak government is urged to reveal to the public the exposure and quantum of possible losses suffered by the State Treasury and all government-linked bodies and corporations in Sarawak due to the failings of Serba Dinamik Holdings Bhd.
This is after the High Court on Tuesday (Jan 10) allowed a petition by six financial institutions to wind up Serba Dinamik Holdings Bhd, and its three companies, Serba Dinamik International Ltd (SDIL), Serba Dinamik Sdn Bhd and Serba Dinamik Group Bhd, over debts totaling about RM5 billion.
This is concerning, as the Sarawak government holds significant shares in, and would have suffered significant losses due to the company’s plunging shares prices that started way back in May 2021
Based on its Integrated Report 2021, the State Financial Secretary is the second biggest shareholder with 159.5 million shares and 36 million warrant holdings while state-linked Bintulu Development Authority is the 12th biggest shareholder with 21 million shares and 6 million warrant holdings.”
That is about 30% of total shares of the company owned by bodies linked to the Sarawak Government.
Back in May 2022, I questioned the State government to be transparent on this matter as it is an issue of public interest and involve a significant amount of public money, and exposure to the Sarawak government and the people of Sarawak.
On 26th May 2022, the Deputy Premier Datuk Amar Douglas Uggah Embas answered in the Dewan Undangan Negeri(DUN) that the company is only going through a series of interim or short-term setbacks.
He went on further to say that , the company is looking into a turnaround and restructuring plan, and the investment is closely monitored, and the State Government wish to not reach a position whereby too often, investment decisions are made based upon isolated and short-term considerations.
However, he fell short of revealing the total amount the Sarawak Government has in this company and possible losses due to the scandal.
His statement also reveals that they have not at that time pulled out their investment and was still playing a wait and see approach with that company.
Fast forward less than a year, we see how the High Court now has allowed the winding up of the company and huge debts crippling the company.
That is why is the spirit of transparency and huge public interest, the Sarawak government must reveal in the spirit of transparency three important factors.
First factor is the details and the quantum of losses suffered by the state treasury and all the respective government-linked bodies and corporations in Serba Dinamik; second factor, if there was any proactive measure done by the Sarawak government at the beginning to protect the interest of Sarawak since the breakout of the scandal as early as May 2021 and the third factor, what are the plans of the government to recoup the enormous losses in public fund and ensure such scandals do not happen again.
The implications would have a long-term effect because of the seriousness of the issue as it does not just involve bad business investment, but rather an issue of bad governance and possible fraud in the company, involving prominent Sarawakians as well.
The Sarawak government should explain specific plans if any, to better protect the interests of Sarawak and to recoup the possible enormous losses in public funds.
On a longer-term basis, to ensure greater transparency to all Sarawak investments and even government-linked bodies such as PETROS, DBOS and many others, it is vital, that all their financial reports are tabled in DUN annually for greater scrutiny and accountability.
Good governance is fundamental to ensure the future of Sarawak and Sarawakians are protected.
The State Government owes it to the people to be accountable especially when we are looking at managing huge sums of public money including plans for our “Sovereign Fund” which involves the future of our children.