Thursday, November 26, 2009

malaysiakini REPORTS an Early Christmas GIFT from MITI

This impressive looking building is the MATRADE Center in KL, completed after many years of delay and million ringgit cost over-runs.
Too date it has not been established what was the cause of the project's shortcomings.
Maybe the ministry in charge of the project has learned a few valuable lessons as they have now embarked on MATRADE 2.0 as described in this malaysiakini article headed Malaysia in dire need of a convention center".
MITI has a simple plan to get such a mega-convention center.
According to the Malaysian Insider, Matrade gets expo centre for ‘free’, says Mustapa.
According to the article,
"Mustapa explained that building-for-land deal is good value for the Malaysian External Trade Development Corporation (Matrade).

“The valuation of the land in 2007 is RM197 million and we are getting RM628 million’s worth building so we are getting value for money for us. We need a big centre,” he told reporters in parliament here.

The mammoth expo centre being built on a 13.1-acre site in Jalan Duta here is to be developed by Naza TTDI, a unit of the Naza Group, in exchange for 62.5 acres of state land at RM226 per square foot although the market value of the land could reach RM1.5 billion. The entire project will have a gross development value of RM15 billion."

The reasons given for awarding the award to the NAZA group is incredulous as apparently it was based on the fact that the company approached the ministry first with the idea of getting such a "free convention center".
NAZA has been the approved AP receiver for thousands of APs and one can only speculate why they have also been favoured with such a land grant.
If you consider the Insider article, the government will be receiving a RM628m building in exchange for RM1.5b of prime land, so in effect, NAZA already makes a profit of RM872m just on the market value of the land, less land improvement charges. Looks as if NAZA is getting the land for free instead of MITI!

Just because they came up with the concept should not prevent the ministry from having an open or restricted tender from 5 or 6 different parties so that the government maximises the proceeeds from this valuable parcel of land.
In fact the Ministry of Finance should have firm restrictions on such transactions like:
1.Any deal above RM50m must have at least 2 qualified bids
2.Any deal above RM100m must have at least 4 qualified bids
3.Any deal above RM500m must have at least 6 qualified bids

Now it seems if you can get the ear of the Minister, you can come away with some nice freebies.
I remember reading an article about the time when Tun Tan Siew Sin was the Minister of Finance. At the time, MCA was a powerful member of the Alliance (before the BN).
TT wanted to take a few days leave and went to see the Tunku. TAR told him to take the time off.
TT asked, "Who will look after my duties when I am away?"
TAR replied that he would take care of things.
According to the story, TT did not take his leave on that occassion.

Nowadays UMNO controls the Finance Ministry and the results have not been sterling. Just read the Horror Reports of the Auditor-General each year and you will know what I mean.

MATRADE 2.0 for FREE? NAW! Tell me another tall tale, please.

1 comment:

PeterP said...

We already have many convention centers in the country. Almost all are white elephants. The one in Putrajaya is an example.