Guan Eng: 1MDB debt at RM50.75b, gov't paid RM8.93b to date

Modified 4 Nov 2019, 8:17 am

PARLIAMENT | The government channelled RM8.93 billion towards paying off 1MDB debt over a two year period, and its total debt stands at just over RM50 billion, Finance Minister Lim Guan Eng said today.

Lim said this in a parliamentary reply to a question from Kluang MP Wong Shu Qi, who asked last Wednesday how much of the 1MDB debts have been repaid by the government, and for details of the 1MDB debt repayment plan.

"For the period between April 2017 and May 2019 the government provided financial assistance of approximately RM8.93 billion to 1MDB, through the Ministry of Finance and the Minister of Finance (Incorporated), for the purpose of repayment of loan interest payments and a settlement fee to the International Petroleum Investment Company (IPIC)," Lim replied.

He informed the Dewan Rakyat that the sum of 1MDB debt as at Oct 30, 2019, stood at RM50.75 billion, comprising principal payments and interest on syariah-compliant bonds (sukuk), and bonds amounting to RM31.65 billion and RM10.2 billion respectively. He also included the government's financial assistance of RM8.93 billion in this calculation.

"The annual commitment of 1MDB debt interest payments up to 2021 comes to about RM1.7 billion," the finance minister added.

According to Lim (above), as of September 30, 2019, a total of RM925.1 million in 1MDB-related funds have been successfully recovered and deposited into the Assets Recovery Account under the Ministry of Finance. This sum includes RM6.1 million returned to the 1MDB Foundation.

"This fund has been acquired in various foreign currencies, including US dollars, Singapore dollars, Australian dollars and Chinese renminbi," he said.

The amount does not include the estimated revenue from the sale of the Equanimity yacht (below) of US$126 million (RM529.2 million), which was fully received on April 23, 2019, and is now kept in the Sheriff's Stakeholder Account for the purpose of adjustment demands made towards the cost of the ship's maintenance, which will be determined by a court order.

Lim said that the balance of the sales revenue, after the deductions for these expenses, is expected to be deposited into Assets Account Recovery in the fourth quarter of 2019.

"Overall, the 1MDB-related funds that have been successfully recovered amount to about RM1.45 billion," Lim said.

The Assets Recovery Account Fund will be used for payment of the 1MDB debt, he added.

"This is important to avoid defaulting, as subsequent 1MDB debts would have a negative impact on the country's economy because these debts are guaranteed by the Government of Malaysia through government guarantees, letters of support and settlement agreements."

The stark reality, as presented by Lim, is that the entire RM1.45 billion Assets Recovery Account fund is just enough to cover the interest on 1MDB debts from September 2019 to April 2020, which will amount to RM1.34 billion.

Therefore, he said, financial assistance from the government would still continue to be needed.

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