Govt will honour 1MDB bonds, says Guan Eng

23 Apr 2019 / 13:19 H.

PUTRAJAYA: It is the government that has to pay back the 1MDB bonds as they were the ones who had guaranteed them, according to Finance Minister Lim Guan Eng.

He said today that bondholders such as Tabung Haji (TH) and Retirement Fund Inc (KWAP) need not worry about being paid.

“We will honour our obligation to pay back the bond,” Lim said after witnessing the signing ceremony between the government and Bombardier Hartasuma Consortium. “The government will have to find funds to pay back the bonds but in return we get nothing.”

The government signed the agreement on behalf of Prasarana Malaysia Bhd for the delivery of 27 new train sets for the Kelana Jaya line and the mid-life refurbishment and upgrading of two-car train sets to four-car train sets.

Lim declined to answer whether the bonds held by TH and KWAP would be converted to equity for the revitalised Bandar Malaysia project.

Both the funds had taken up bonds issued by 1MDB for the Bandar Malaysia project under the previous Barisan Nasional administration.

On the question whether the government had given 4,500 acres to a China-owned company as part of the new East Coast Rail Link (ECRL) contract, Lim denied that such an agreement had been made. He said he had not been informed about such a deal.

“This is not correct, if there is anything that is additional in the contract it has to go through Cabinet.

“If the 4,500 acres had been paid for than that’s a different question but given for free is not true,“ Lim said.

He pointed out that the land could be part of the transit orientated development (a development that maximise residential, business and leisure space within walking distance of public transport), which is part and parcel of any development project.

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