Corporate  |  FEBRUARY 15, 2013 7:06AM

Government soft loan for highway job in question

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A government soft loan to construction company Ahmad Zaki Resources Berhad has come under scrutiny, as it covers about half of the total cost of the East Klang Valley Expressway (EKVE).

Tony_Pua_(1)In a press statement today, Petaling Jaya Utara MP Tony Pua said that the move to extend a RM635 million soft loan to Ahmad Zaki calls to question the need to privatise the project at all.

“The obvious question is, if the government is already able to fork out nearly half of the required investment to build the highway, why is there a need to privatise it in the first place?

“Is it so that certain companies can bleed the rakyat for multi-billion ringgit profits in the future?” he asked.
Ahmad Zaki on Monday announced that it had bagged a 50-year concession to build the tolled expressway to link the Kajang Silk Highway to the Karak Expressway, at a cost of RM1.55 billion.

It also signed an agreement with the government for a soft loan at four percent per annum interest rate.

At 50 years, Pua said, the EKVE concession is only the second longest in the nation’s history, behind the 60-year RM6 billion concession given to Kumpulan Europlus (KEuro), controlled by tycoon Tan Ah Chye, in January.

KEuro was also extended a government soft loan of RM2.24 billion at 4 percent interest per annum.

He said that the award of large projects to politically-linked businesses like Umno-linked Ahmad Zaki in the lead up to the general elections raises suspicion of political funding.
This is particularly so, he said, when considering the number of large contracts awarded in the last 12 months.

Among them is another highway project, the RM2.2 billion Kinrara Damansara Expressway (Kidex) which was awarded last year to companies linked to Umno lawyer Hafarizam Harun and former chief justice and Umno disciplinary committee chairperson Zaki Azmi.

Others include the RM1.2 billion Ampang LRT extension project, which was won by water meter manufacturer George Kent, despite experienced global players like Balfour Beatty joining the bid.

He added that the government also awarded a RM1.33 billion contract to MRCB for other works on the same construction line the month after, and about RM20 billion worth of contracts for the MRT project.

“In dishing out these lucrative contracts, it is certain that BN is also desperately raising funds from their cronies in return to fight their life and death mother of all elections to ensure its survival,” he said.

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