After Proton, sell stakes in loss-making GLCs too, says DAP

Selangor has many loss-making GLCs that may need selling off or closing down

(FMT) – A DAP legislator has called for loss-making government-linked companies (GLCs) to have their equities sold off to “white knights”, following in the footsteps of DRB Hicom Bhd’s move to sell a stake in Proton Holdings Bhd to a multinational company based in China.

Segambut MP Lim Lip Eng today described Prime Minister Najib Razak’s logic on the recent agreement to sell the 49.9% stake to Zhejiang Geely Holding Group as “reasonable”.

He said Najib’s “economic theory” that it made good sense to own a smaller equity in a company poised to access bigger consumer markets, rather than retain 100% ownership over loss-making firms, must be applied to several GLCs in the country as well.

“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,” he said in a statement.

He said besides Proton, almost all nationally-owned transportation companies were making losses, including Keretapi Tanah Melayu Bhd, Prasarana Malaysia Bhd and Malaysia Airlines Bhd.

“Shouldn’t Najib also look for white knights who are capable of turning around these failing companies?” he said.

He added that other examples of loss-making GLCs with market monopolies were Halal Industry Development Corporation 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 May 24, Zhejiang Geely reportedly confirmed its agreement to purchase the 49.9% stake in Proton, together with another 51% in Lotus Cars, from DRB-Hicom.

Despite receiving government aid, Proton, which was set up in 1983 as the country’s first national automobile company, has been riddled with financial problems over the last few years.

Lim also said Malaysia’s budget deficit had scaled up to between RM37 billion to RM47 billion over the past nine years.

He said the exchange rate for a Singapore dollar to be converted to ringgit had also shot up from 2.4 in 2009 when Najib became prime minister to 3.1 today.

He accused the Barisan Nasional government of incurring losses for too long, and said Pakatan Harapan, which comprises DAP, PKR, Amanah and PPBM, should be given a chance to govern 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.