As the National Economic Action Council (NEAC) supremo since 1997 and Finance Minister in the past three years, Daim must shoulder the greatest blame for the country’s poor record in economic reforms and good corporate governance.
The MICG President Datuk Megat Najmuddin Khas complained last week that Malaysia’s bad image problem among foreigners was reflected in a recent World Bank report that rated the country one notch above Indonesia, which was last in terms of corporate governance standings for Asian countries. The report, which was presented at a round table conference on corporate governance in Singapore earlier this month, had put Malaysia in a bad light.
Megat said: “We need to show that Malaysia has world-class corporate governance and adopts best practices. But before we can tell the world, we need to improve domestic perceptions.”
He said all parties, including the corporate sector and the Government, must show greater transparency to regain the confidence of domestic and foreign investors, who already have a negative image about the country.
“There is a crisis of confidence and we must overcome this by being more responsible and honest, to show that we have nothing to hide, and this applies to both the corporate sector and the Government.”
He lamented: “We rewarded crooks instead of honest people. We believe in excessive speculation, but not long-term investment” and the stock market has been treated like a casino.
Daim should cut out all empty rhetoric in his speech at the conference on corporate governance and convince local and foreign investors about the government’s commitment to accountability, transparency and good corporate governance.
For a start, he should explain why Malaysia has ranked so poorly among Asian countries on corporate governance as only to be able to be better than Indonesia and what immediate measures would be taken to place Malaysia in the international top rankings on good governance.
Secondly, he should set an example of good corporate governance by giving full and proper accounting for the many burning issues in the country crying out for answer, in particular the full extent of involvement of government-linked funds and agencies like Employees’ Provident Fund (EPF), Pensions Trust Fund (KWAP), Khazanah and others in the bailout of the RM25 billion debts of Halim Saad and Renong as well as other “crony capitalists”.
Without giving an acceptable explanation as to why KWAP had incurred some RM360 million losses as a result of its irresponsible and even illegal investment and involvement of RM903.74 million in the Time dotCom IPO bailout, another KWAP scandal has exploded with KWAP incurring some RM44 million losses in its recent acquisition of 24.4 million Commerce Asset-Holding Bhd (CAHB) shares.
Early this week, KWAP declared that on March 22 it bought 24.4 million shares in CAHB, the owner of the second largest bank in the country, and is now a substantial shareholder of CAHB with a 2.07 per cent stake.
It is public knowledge that among Halim Saad’s manoeuvres to clear his RM25 billion debts is to saddle Renong's short-term debt load of RM5 billion to UEM and leave it with investments in several unprofitable and debt-heavy businesses from the Renong stable, which include its investments in troubled telecommunications concern Time Engineering Bhd., banking group Commerce Asset Holding Bhd., hotel owner Faber Group Bhd., transport company Park May Bhd. and Crest Petroleum Bhd as well as two unlisted companies -- light rail concern Putra and property developer Prolink Development Sdn. Bhd..
Time Engineering and Putra have been bailed out with the use of public funds, at great detriment to EPF, KWAP and the taxpayers.
Daim should explain what is the connection with the latest disastrous KWAP investment in CAHB with the bailout of the colossal debts of Halim Saad and Renong.
In fact, EPF should explain why it had been aggressively purchasing the CAHB shares since last year, acquiring some 27 million shares since October last year when its price had almost halved in this period from RM10.30 to RM5.25 when trading closed on Friday - which would involve another staggering EPF loss of some RM100 million.
Finally, Daim should make clear tomorrow his position as Finance Minister, whether he is resigning or not, whether he is still the person to sign all papers in the capacity of Finance Minister, and why he had not signed and gazetted the two per cent cut in employees’ EPF contribution for the last four weeks since its first announcement by the Prime Minister, Datuk Seri Dr. Mahathir Mohamad in the RM3 billion economic stimulus package as to render any EPF implementation of the 2 per cent cut from April 1, 2001 unlawful.
(22/4/2001)