5G Network: Pejuang Youth urges govt to cancel Digital Nasional Bhd

 

Putrajaya's decision to set up Digital Nasional Berhad (DNB) to build and own Malaysia's 5G network infrastructure would incur losses to taxpayers' money, according to Pejuang Youth chief Abu Hafiz Salleh Hudin.

He said the government should utilise the existing local telecommunication providers to develop the network, instead of forking RM15 billion to set up DNB, which is a special purpose vehicle under the Finance Ministry.

Hafiz (above) also refuted the government's claim that with DNB managing Malaysia's 5G network and being the network main supplier it would be able to offer cheaper prices and better speed to consumers.

"By setting up DNB, it incurs additional costs because DNB would then have to either rent infrastructures from others or build a new one.

"If telecommunication companies are the ones tasked to develop the 5G network, then the costs can be reduced because they already have their own infrastructures. The companies can also share the network between them," Hafiz said in a joint statement with Pejuang Finance and Communication Bureau.

According to the politician, the business model being used by Putrajaya in developing the 5G network is different from what other countries are practicing, where they open the 5G spectrum for telecommunication companies to bid.

This would create competition and also make revenues for the government, he added.

"Countries like Kenya, Russia and South Africa also have no longer practiced this Single Wholesale Network policy. And countries like Belarus, Mexico and Rwanda which did, have been recording big losses from this policy.

"Setting up of DNB would also create other risks to the local industry and consumers, such as security and durability of the 5G network, which can lead to a single-point failure if it is not built and managed well," Hafiz said.

Malaysiakini has sent requests for comment to the office of Finance Minister Tengku Zafrul Abdul Aziz and Communication and Multimedia Minister Annuar Musa.

Finance Minister Tengku Zafrul Abdul Aziz

Hafiz said the government would lose the opportunity to make RM15 billion in prospective profit from selling network spectrum to existing telecommunication companies.

Instead, he added, Putrajaya would have to spend another RM15 billion either through incurring national debt or by publishing government-insured bonds for setting up DNB.

"Sale of 5G network spectrum to private telecommunication companies have been very profitable to the government of Thailand, which made RM12 billion, and the Bangladesh government which has made RM3.5 billion.

"At this juncture when the government said that the country does not have money, why does it not choose a model which can bring profit to the country?

"By setting up DNB, the government has to spend RM15 billion by incurring debt or publishing bonds that are insured by the government. And since DNB is a company that is fully owned by MOF, should DNB's finances and operations not be well managed, then the ones who have to repay this debt are the rakyat," he said.

Hafiz urged the government to stop and cancel DNB, saying that the government should not make a plan that would further risk the country's financial situation especially when it is still recovering from the impacts of the Covid-19 pandemic. - Mkini