Former Council of Eminent Persons (CEP) chairperson Daim Zainuddin is leading the negotiations with China to retrieve the RM8.3 billion that was paid to contractors of the Multi-Product Pipeline (MPP) and Trans-Sabah Gas Pipeline (TSGP) projects.
Finance Minister Lim Guan Eng said the discussions have been going on for the past one year.
“I do not think we can get a better negotiator than Daim. He has the discretion and freedom because even though he is the chief negotiator, he is not part of the government.
“So he is able to manoeuvre, as well as have the freedom to make suggestions that can allow both parties to reach amicable and agreeable solutions,” Lim told Bernama.
Daim, the country’s former finance minister, also led renegotiation on the East Coast Rail Link (ECRL) project with the Chinese government on April 12, which saw the government successfully reduce the price of the rail project from RM65.5 billion to RM44 billion for a whopping saving of RM21.5 billion.
Lim said Daim managed to pull off the ECRL renegotiations without affecting the important bilateral relationship between China and Malaysia, while at the same time he was able to get Beijing to purchase more palm oil, put in more investments in Malaysia and assume half of the ECRL operating cost.
“This is the best deal we can get,” he said.
Lim said the pipeline projects in Sabah were among many infrastructure projects that have created a huge debt load for the government, given their dubious nature.
The RM8.3 billion payment to contractors of the project comes up to about 88 percent of the total contract value, despite only 13 percent of the projects having been completed.
The RM9.4 billion project was awarded to the China Petroleum Pipeline Bureau on Nov 1, 2016.
“When we ask the contractor to show us where they laid the pipe or the preliminary works they have done in Sabah, they refused to take us. When we went on the ground, we could not even find one screw, and yet they were paid RM8.3 billion.
“How can you pay money for no work done? Up until now, they have failed to give any explanation,” Lim added.