THE JOURNAL consists of selected, most notable and newsworthy POSTINGS OF THE DAY.

Monday, December 22, 2008

> The PKFZ fiasco !

An employee sweeping a deserted complex at the PKFZ - TMIpic

Transport Minister Datuk Seri Ong Tee Keat, who vowed to reveal all in the Port Klang Free Zone (PKFZ) debacle, offered instead a testimonial of his own apparent success in revitalising the scandal-ridden project that helped force his predecessor out of office.

At a much-anticipated special briefing today, the minister said the performance of the integrated commercial and industrial zone had improved since last March.

He told a press conference that lasted more than an hour that the occupancy rate, employment, investment status and cargo movement have increased since the change of management that took place in May.

He stressed that the review, which he had previously called a chronology of events, was not a financial audit but a statement of facts.

“My job is not to pass judgement but to enumerate what has been happening,” said Ong.

“This is entirely based on documents and official records that we have,” he added.

Question marks about the project arose late last year after a RM4.6 billion soft loan was proposed for the industrial zone, which has been described as a ghost town with few tenants or investors.

The PKFZ project has been criticised because its development cost of less than RM2.5 billion had ballooned amid concerns about its ability to meet its debt obligations as well as that of the soft loan.

There were also questions about the possible kickbacks after it was disclosed that several individuals acquired the piece of land where the PKFZ now sits at RM3 per sq ft in 1999. The Port Klang Authority (PKA) later acquired the land at RM25 psf.

PKFZ ran into further problems when Jebel Ali Free Zone quit the management of the property.

Former Transport Minister Datuk Seri Chan Kong Choy was dropped as a Barisan Nasional (BN) candidate in the March general elections, and subsequently lost his job, largely as a result of how the debacle was handled.

The PKA decided in its board meeting in May this year to hire PricewaterhouseCoopers to conduct an independent audit.

Reading from a prepared statement today, Ong said PKFZ had recorded an increase of more than RM200 million in investments from March to November.

Occupancy rate for all facilities had also increased, with the leased office block recording the most significant increase from one per cent in March to 19 per cent as of November.

For open land and light industrial unit facilities, the occupancy rate is now 18 per cent and 17 per cent respectively.

“The Jebel Ali took six years to have 40 per cent occupancy,” said Ong referring to the free zone in the United Arab Emirates.

Most importantly, said Ong, was the number of employees in the area which had increased from 972 to 1,659 within the last eight months.

“I still can remember when I first set foot in the area, people said this is a ghost town,” said Ong when elaborating on the success in increasing the number of employees in the PKFZ.

Ong however refused to blame his predecessors at the Transport Ministry.

“That is the question that only my predecessors can answer at that point of time,” said Ong.

“You are asking me to comment on my predecessor. This is, of course, his discretion at that point of time, perhaps due to whatever reasons or circumstances that he had at that material time. That is the question only my predecessor could answer at that material time,” Ong said.

“But if you were to ask me then of course I might have my own views ... I may not do it but it doesn’t mean what I say or what I choose is going to be the gospel truth.”

Ong denied that he had any knowledge of any action that would be taken against two notable politicians with regard to the PKFZ project as reported by a Chinese newspaper.

Responding to a question whether a minister could write a letter of guarantee on a loan for a mega project such as the PKFZ, Ong said that as he had said in parliament previously, the letter issued by the minister before him on the project was a letter of support and not a guarantee.

He slammed the opposition for misleading the public into thinking that the RM4.6 billion government soft loan to PKFZ had been wasted.

“The 4.6 billion is the total amount and takes into account the accumulated interest,” said Ong, adding that the money is being issued in stages.

He added that the financial aspects of the PKFZ would be presented upon the completion of the report by audit firm PriceWaterHouseCoopers - The Malaysian Insider.