LETTER | In a news report published on Jan 26, your CEO gave the assurance that the EM–IIG project awarded by the little-known Xiddig Cellular Communications Sdn Bhd was intact and viable.

Your CEO was further quoted to have said that Mesiniaga had done its due diligence on Xiddig and its business plan prior to bidding for the project and the company was satisfied with Xiddig’s capabilities and the contract and payment milestones have been agreed upon and are fair to both parties.

I recap herein the chronology of this little-known project called the East Malaysia International Internet Gateway (EM–IIG) based on information from the Internet:

In July 24, 2016, the Borneo Post reported the launching of the EM-IIG by then deputy prime minister Ahmad Zahid Hamidi with a groundbreaking ceremony of the project in Kampung Rampayan Laut in Sabah. The article also mentioned that the project is developed by Xiddig Cellular Communications Sdn Bhd and it involves four phases as follows.

The first phase involves the laying of 60 terabyte undersea fibre optic cables, the second phase connects all telecommunications companies in Sabah and the third phase is the construction of a Tier-4 data centre.

These three phases were expected to be completed in two years at the cost of about RM850 million via private funding initiative. The fourth phase will see Xiddig and the Ministry of Communications and Multimedia expand the MSC to Sabah.

In the July 19, 2017 edition of The Edge Markets, it was reported that Angkatan Koperasi Kebangsaan Malaysia Bhd (Angkasa) had signed a memorandum of understanding with Xiddig Cellular Communications Sdn Bhd to enable cooperatives under its aegis to participate directly in the government’s Enhanced Malaysia International Internet Gateway (EM-IIG) project.

The president of Angkasa was quoted to have said that under the MoU, the cooperatives would be able to invest in the government’s initiative which could see a potential investment of RM5 billion. The executive chairperson of Xiddig was also quoted to have said that the whole project will be ready for service by October last year.

On Jan 23, 2019, the office of the current deputy prime minister denied that the speech attributed to her at the event to launch the EM-IIG on Jan 22, 2019, was approved by her. The speech delivered apparently said the government would extend its full cooperation to the implementation of the Enhanced Malaysia International Internet Gateway (EM-IIG) High-Speed Broadband project.

On Jan 25, 2019, the MCMC issued a statement to say that the Enhanced Malaysia International Internet Gateway (EM-IIG) High-Speed Broadband project by XiddiG Cellular Communications Sdn Bhd was a commercial endeavour that did not involve the commission. (Please note that in the report by Borneo Post on July 24, 2016, EM-IIG was referred to as the East Malaysia International Internet Gateway while in the statement by the MCMC, EM-IIG was referred to as the Enhanced Malaysia International Internet Gateway.

On Jan 29, 2019, the Communications and Multimedia Minister Gobind Singh Deo said his ministry never promised Xiddig Cellular Communications Sdn Bhd its cooperation in their broadband project.

A quick visit to the website of Xiddig reveals little information on the company. It doesn’t have the basic information about their board of directors or management figures and past projects developed by them – a key feature which companies which have handled projects of such size would declare to demonstrate their edge.

In light of the mounting news on this project, I would like to know the risk assessment Mesiniaga has performed to satisfy itself of the client’s capabilities and its ability to satisfy and pay for the full sum of the contract of RM1.9 billion.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.