16 Dec 2015
Reproduced with permission
‘Insulting’ or doing his duty – what caused Chong’s censure?
Sarawak’s dodgy high interest loans are draining state finances
“Adenan has tried to justify these borrowings but failed miserably,” said Chong. “It only confirms my suspicion that there are great improprieties in these offshore loans taken by the Sarawak Government.”
..Who are the bond holders?” he asked. “Are these bond holders related to the top Barisan Nasional (BN) leaders with a lot of money overseas? Why is the Sarawak Government paying so much interest on these loans?” [Free Malaysia Today Nov 29th]
“On average, the state government is paying more than 6 per cent per annum on these loans.”
The 6 per cent, pointed out Chong, is 40 per cent more than the average interest paid on sovereign loans taken by the Malaysian Government at various times. “Why borrow and pay interest when we have RM27 billion in reserves sitting in the bank, in Fixed Deposit, earning only 2 per cent to 3 per cent interest per annum?”
“It doesn’t make financial sense. When the money is paid out from these offshore loans, no questions can be asked in the State Assembly.”
…..all the loans taken were at extremely high interest rates payable by the state government.
Chong said that based on figures revealed by the Sarawak Government, the particulars on the offshore loans taken by it were as follows for the year end 2015: Sarawak Capital Incorporated Bond due in 2026. Principal amount still owing is USD165 million and balance of interest owing is USD148.96 million; Equisar International Incorporated Notes due in 2026. Principal amount still owing is USD533.5 million and balance of interest owing is USD556.75 million; and SSG Resources Ltd Notes due in 2022. Principal amount still owing is USD560 million and balance of interest still owing is USD238 million. [Free Malaysia Today]