The government should consider looking for “white knights” to turn around loss-making government-linked companies (GLCs), argued Segambut MP Lim Lip Eng following Geely Automobile Holdings Ltd’s acquisition of a significant stake in Proton Holdings Bhd.
This followed Prime Minister Najib Abdul Razak’s statement on Friday suggesting that it is better to have a smaller equity in a company that stands to gain ccess into bigger markets, economies of scale and cutting-edge technology, as opposed to retaining a loss-making company that is 100 percent Malaysian owned.
While it Najib’s logic does appear reasonable, Lim said the same must also be applied to other GLCs.
“It is mind boggling that many of our GLCs suffer huge losses every year despite being ‘protected’ by our government and some GLCs even enjoy market monopoly.
“It is not only Proton but almost all other national owned transportation companies which are making losses, from Keretapi Tanah Malayu Bhd, Prasarana Sdn Bhd to Malaysia Airlines Bhd.
“Shouldn’t Najib also look for white knights who are capable of turning around these failing companies? Further examples of loss-making GLCs with market monopoly are Halal Industry Development Corp Sdn Bhd, Indah Water Konsortium Sdn Bhd, Mimos Bhd and Sirim Bhd.
“Perhaps it is time for Najib to reconsider the monopoly privileges granted to these companies,” he said in a statement today.
On May 24, it was announced that Geely would acquire a 49.9 percent stake in Proton from the firm DRB-Hicom Bhd.
‘The answer is obvious’
Geely will also acquire a 51 percent in British sports car brand Group Lotus Plc, which is a fully-owned subsidiary of Proton Holdings. The balance would be acquired by little-known Etika Automobile Sdn Bhd, which is linked to tycoon Syed Mokhtar Al-Bukhary.
Without naming any particular company, Najib said “the answer is obvious” on whether to retain a 100 percent Malaysian company that is making losses, or a smaller equity in a better company.
Meanwhile, Lim chided that the BN-led administration under Najib has been a loss-making government for too long.
He said Malaysia’s budget deficit remained appallingly high in the nine years under Najib’s premiership, and the value of the Singapore Dollar had increased from RM2.40 per dollar in 2009 when Najib became prime minister, to RM3.10 today.
“The answer is obvious that Najib-led BN government has been a loss-making government for way too long. Malaysia will be better off with BN playing a lesser role in parliament and let Pakatan Harapan administer the country for a change.
“Just like in the case of Proton where only time will tell if Geely can successfully turn it around, time will also show whether Pakatan Harapan can turn Malaysia into a more prosperous country,” he said.