Khazanah’s changes ‘clearing the deck for restructuring’

By NG MIN SHEN / Pic By ISMAIL CHE RUS

The resignation of all board members of Khazanah Nasional Bhd, including its MD, will enable the government to restructure the sovereign wealth fund accordingly, as declared in a statement by the Prime Minister’s Office last Friday.

Prime Minister (PM) Tun Dr Mahathir Mohamad, who welcomes the offers of resignation from the entire board, said the members’ departure is a move to “clear the deck to allow the government to restructure it”, in line with the policies of the new administration.

“This action of clearing the deck will allow restructuring as our policies are now different. While we believe in paying good salaries, we cannot all the time base it on commercial rates.

“We would rather focus on rewarding with good bonuses tied to performance as some companies may not perform as they should,” Dr Mahathir said.

He said the government is “not on a witch hunt” and stressed that it is the PM’s prerogative to appoint the fund’s new board members, re-designation to other entities and to retain some of them, to allow for continuity.

“We do not regard everyone as guilty of everything, but this administration will not accept obvious wrongdoings,” Dr Mahathir stated.

Last Thursday, all nine board members of the sovereign wealth fund, which was created 25 years ago to manage Bumiputera equities, offered their resignations to the government.

The board members who tendered their resignations are MD Tan Sri Azman Mokhtar (picture), Datuk Seri Nazir Razak, Tan Sri Md Nor Md Yusof, Tan Sri Mohamed Azman Yahya, Datuk Mohammed Azlan Hashim, Tan Sri Andrew Sheng Len Tao, Raja Tan Sri Arshad Raja Tun Uda, Datuk Dr Nirmala Menon and Yeo Kar Peng.

Khazanah had said in a statement that the offer to quit by the board members would “facilitate a smooth and orderly transition under the new government”.

The resignations were widely expected following changes at other state-owned investment funds like Permodalan Nasional Bhd and Lembaga Tabung Haji.

On reports that RM2 billion had been wiped out from the market capitalisation of several of Khazanah’s investee companies following the resignation announcement, Dr Mahathir said the amount of paper loss was nothing compared to the burden of the RM1 trillion debt that had been inherited and is now to be shouldered by the current government.

“The amount of debt is real, the amount needed to service the debts is real. And most of the amounts ‘invested’ by the previous administration has yet to be recovered as we do not know where they have been invested in,” he said.

Meanwhile, in response to former PM Datuk Seri Mohd Najib Razak’s comment on the current government’s policies as returning to a bygone era, Dr Mahathir also quizzed if Malaysians would prefer a return to the era of Najib’s administration.

“The bygone era is the era when Malaysia was known as an ‘Asian Tiger’. Is he saying that the people should be taken back to the era when the nation was known as a kleptocracy led by a kleptocrat?” Dr Mahathir asked.