Govt to maintain ownership of 8 loss-making GLCs

By P PREM KUMAR & ALIFAH ZAINUDDIN

The current administration is expected to maintain its ownership of loss-making government-link companies (GLCs) in an effort to preserve interest in strategic sectors, while providing social services and stimulating economic development.

Finance Minister Lim Guan Eng told the Parliament yesterday that eight GLCs under the Minister of Finance Inc (MoF Inc) have been reporting consecutive net losses over the last five years.

The companies are Astronautic Technology (M) Sdn Bhd (ATSB), Halal Industry Development Corp Sdn Bhd, Indah Water Konsortium Sdn Bhd (IWK), Inno Bio Ventures Sdn Bhd, Malaysian Bioeconomy Development Corp Sdn Bhd, MIMOS Bhd, Prasarana Malaysia Bhd and Syarikat Perumahan Negara Bhd.

“Essentially, these GLCs, especially the MoF Inc, were established for a non-profit purpose and to serve a specific objective that has been set by the government.

“In this regard, even though these MoF Inc firms are loss-making, the ownership of these companies will still be maintained under certain conditions,” Lim said in a written parliamentary reply.

The minister was responding to MP Maria Chin Abdullah (Pakatan Harapan-Petaling Jaya) who asked the government to state the number of GLCs and government- linked investment firms under MoF Inc which have reported losses and profits in the last five years.

ATSB was mandated primarily to develop space and satellites technology focusing on research and development, employing advanced and innovative technologies for the space industry.

IWK is the national sewerage company, while Inno Bio Ventures is involved in biotechnology sector in the field of production and commercialisation of biologics, or biosimilar product for national interest.

Some 17 companies, meanwhile, have registered net profit consecutively in the last five years. Among them were Amanah Raya Bhd, Bank Pertanian Malaysia Bhd, Cradle Fund Sdn Bhd, IJN Holdings Sdn Bhd and Khazanah Nasional Bhd.

Pakatan Harapan’s historic May 9 election win had resulted in a major shake-up across government-linked entities that have seen many heads of GLCs being forced to step down and several agencies shut down.

Positions that were once held by politically-appointed representatives by the previous Barisan Nasional administration are now filled by professionals who have been entrusted to carry out reforms to restore the management and fiscal health of these government units.

Scandal-plagued agencies such as the Federal Land Development Authority and pilgrimage fund Lembaga Tabung Haji are now looking to sell their assets to settle their debt and improve their weak cashflow.

Meanwhile, agencies deemed as political or non-essential by the new government such as the Land Public Transport Commission and the Special Affairs Department were disbanded.

Prime Minister Tun Dr Mahathir Mohamad has spoken about the need to restore the roles of GLCs, calling them “monsters” that have deviated from their original purpose of serving the poor.

The 93-year-old political leader had also reiterated the government’s intent to dispose its assets in the recent tabling of the midterm review of the 11th Malaysia Plan to cope with its RM1 trillion liabilities.

Apart from improving its coffers, the move is also seen as part of the new government’s commitment to scale back its involvement in the private sector. In his speech at the “Malaysia: A New Dawn” investors conference earlier this month, Lim said the government had no business in businesses.

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