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Rafizi to 1MDB: Reveal where RM2.4b sukuk went
Published:  Jan 13, 2016 11:20 AM
Updated: 7:19 AM

State sovereign fund 1MDB must reveal the detailed breakdown on how it utilised funds raised through the company's RM2.4 billion sukuk (Islamic bonds) for Bandar Malaysia, PKR vice-president Rafizi Ramli insisted today.

Based on 1MDB's rebuttal of his earlier claims that RM1.6 billion from the RM2.4 billion sukuk was unaccounted for, Rafizi said in a statement the funds appeared to have been used for operations of its subsidiary, 1MDB RE.

"1MDB must answer for what purpose RM1.48 billion from the sukuk fund was used by its subsidiary, 1MDB RE, when it does not have any other business activities except as the developer of Tun Razak Exchange and Bandar Malaysia.

"In fact, since 2014 until now, these two development projects have yet to take off and 1MDB RE's role so far is just like a land broker that sold land along Jalan Tun Razak and Sungai Besi," said Rafizi.

In a statement last night, 1MDB denied Rafizi's allegations , saying that the proceeds raised have been utilised in accordance with the terms of the sukuk programme agreement.

Without giving the detailed breakdown, it said the funds were partly used to finance relocation of the Royal Malaysian Air Force Sungai Besi base, pre-funding of fees and expenses for the sukuk programme, funding the requisite financing reserve accounts and also the working capital requirements from 1MDB RE (now known as TRX City Sdn Bhd).

The Pandan MP, however, said that 1MDB had still failed to answer the main questions raised as only RM800 million was spent on relocation of the RMAF base while his own calculation showed that the remaining expenditures only amounted to RM1.4 billion.

"If most of the sukuk was spent on the airbase relocation and upgrading, there will not be any issue of negotiations with the foreign consortium to bear the remaining RM1.9 billion that needs to be paid.

"If 1MDB is now negotiating for the consortium to bear the remaining costs, then it must mean that all the funds raised have been spent," he pointed out.

He also maintained that the deal could potentially affect the nation's sovereignty by allowing foreign companies to be involved in the management of national assets.

1MDB has rubbished such concerns and pointed out that the turnkey contractor in charge of the project was a fully-Malaysian company.

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