MP SPEAKS With all this unethical and immoral credit given by Minister of Urban Wellbeing, Housing and Local Government Abdul Rahman Dahlan to good billionaire cronies of BN, who are grateful for what Malaysia has given them, against bad BN cronies who have forgotten and are ungrateful, it is useful to note that even pro-capitalist economists oppose crony capitalism.
Described as corruption, crony capitalism is a distorted perversion of capitalism because it is not based on free market and rule of law but on favouritism and illegal abuse of public trust.
The credit given by Abdul Rahman to a billionaire BN crony shows that BN is openly unashamed in breeding cronies who benefit privately at public expense.
And Malaysia is the only so-called democratic country in the world where the BN federal government is not ashamed of celebrating a crony capitalistic policy as well as BN cronies who are so proud of their BN crony status until they are not afraid to make it public.
Has the favoured treatment of BN cronies benefited 28 million Malaysians on essential commodities and services such as rice and electricity charges?
For example one of the important crony projects privatised in 1996 relates to our staple food, rice, where the monopoly concession agreement was given to a new crony company Padiberas Nasional Bhd (Bernas).
With the monopoly of rice imports in Malaysia, the concession agreement was extended for Bernas to 2021 in 2011. Until now, BN has refused to explain why such an extension of time was given.
More importantly BN must come clean on why a tax waiver of RM2.25 billion of duties on rice imports between 2008 and 2013 was given to Bernas.
How does such a RM2.25 billion tax waiver benefit the public?
If the price of rice did go down or the poor paddy farmers benefited in some manner, then the public can understand.
But if the only beneficiary is the private crony, then this is a betrayal of public interest and trust by BN.
Tax exemption
Further, BN should also come clean on whether Bernas received a similar tax exemption before 2008, from the time Bernas was first privatised in 1996?
Bernas’s shareholders are so lucky that Bernas not only obtained a monopoly on rice imports without an open competitive tender but also a RM2.25 billion tax waiver.
Were Bernas ultimate shareholders privy to information of such a huge RM2.25 billion waiver in rice import duties that it influenced the majority shareholders’ decision to privatise Bernas in April and removed it from Bursa Malaysia stock listing?
Another BN crony is YTL Power which was listed in 1997 after securing the concession agreement as the first IPP in Malaysia.
Since then, YTL Power has paid out 36.3 percent of earnings to shareholders as dividends with a compounded annual growth rate (CAGR) of 5.4 percent since being listed.
This compared favourably to CAGR of only 4 percent for the Malaysian economy in terms of GDP during that period.
YTL’s success in sustainable earnings and above average dividend yield is due to YTL Power’s ability to secure the highest internal rate of return (IRR) for an IPP of 15-19 percent and also an incredible provision that compelled Tenaga Nasional Bhd to enter into a compulsory power purchase agreement where Tenaga must take at least 90 percent of the capacity of its plants.
If Tenaga can be compelled to purchase 90 percent of power produced by IPPs, why shouldn’t IPPs be compelled to compensate the public or Tenaga for breakdowns in power supply?
The favourable concession agreements given to IPPs do not benefit the public in terms of lower electricity charges.
Further, there is an extra cost when Tenaga is forced to purchase power it does not need when it has a reserve margin of nearly 30 percent, one of the highest in the world.
These crony projects have either cost the Malaysian government and its people to lose out on revenue it could otherwise collect or end up paying higher price.
For this reason, BN leaders like Housing Minister Abdul Rahman must justify the contribution and national interest to Malaysians from BN’s corrupted policies of breeding BN cronies.
Described as corruption, crony capitalism is a distorted perversion of capitalism because it is not based on free market and rule of law but on favouritism and illegal abuse of public trust.
The credit given by Abdul Rahman to a billionaire BN crony shows that BN is openly unashamed in breeding cronies who benefit privately at public expense.
And Malaysia is the only so-called democratic country in the world where the BN federal government is not ashamed of celebrating a crony capitalistic policy as well as BN cronies who are so proud of their BN crony status until they are not afraid to make it public.
Has the favoured treatment of BN cronies benefited 28 million Malaysians on essential commodities and services such as rice and electricity charges?
For example one of the important crony projects privatised in 1996 relates to our staple food, rice, where the monopoly concession agreement was given to a new crony company Padiberas Nasional Bhd (Bernas).
With the monopoly of rice imports in Malaysia, the concession agreement was extended for Bernas to 2021 in 2011. Until now, BN has refused to explain why such an extension of time was given.
More importantly BN must come clean on why a tax waiver of RM2.25 billion of duties on rice imports between 2008 and 2013 was given to Bernas. How does such a RM2.25 billion tax waiver benefit the public?
If the price of rice did go down or the poor paddy farmers benefited in some manner, then the public can understand.
But if the only beneficiary is the private crony, then this is a betrayal of public interest and trust by BN.
Tax exemption
Further, BN should also come clean on whether Bernas received a similar tax exemption before 2008, from the time Bernas was first privatised in 1996?
Bernas’s shareholders are so lucky that Bernas not only obtained a monopoly on rice imports without an open competitive tender but also a RM2.25 billion tax waiver.
Were Bernas ultimate shareholders privy to information of such a huge RM2.25 billion waiver in rice import duties that it influenced the majority shareholders’ decision to privatise Bernas in April and removed it from Bursa Malaysia stock listing?
Another BN crony is YTL Power which was listed in 1997 after securing the concession agreement as the first IPP in Malaysia.
Since then, YTL Power has paid out 36.3 percent of earnings to shareholders as dividends with a compounded annual growth rate (CAGR) of 5.4 percent since being listed.
This compared favourably to CAGR of only 4 percent for the Malaysian economy in terms of GDP during that period.
YTL’s success in sustainable earnings and above average dividend yield is due to YTL Power’s ability to secure the highest internal rate of return (IRR) for an IPP of 15-19 percent and also an incredible provision that compelled Tenaga Nasional Bhd to enter into a compulsory power purchase agreement where Tenaga must take at least 90 percent of the capacity of its plants.
If Tenaga can be compelled to purchase 90 percent of power produced by IPPs, why shouldn’t IPPs be compelled to compensate the public or Tenaga for breakdowns in power supply?The favourable concession agreements given to IPPs do not benefit the public in terms of lower electricity charges.
Further, there is an extra cost when Tenaga is forced to purchase power it does not need when it has a reserve margin of nearly 30 percent, one of the highest in the world.
These crony projects have either cost the Malaysian government and its people to lose out on revenue it could otherwise collect or end up paying higher price.
For this reason, BN leaders like Housing Minister Abdul Rahman must justify the contribution and national interest to Malaysians from BN’s corrupted policies of breeding BN cronies.
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