LIM Guan Eng has accused Tengku Zafrul Tengku Abdul Aziz and the Perikatan Nasional government of playing politics after they cancelled the RM2 billion loan guarantee for the Penang light rail transit (LRT) project.

The former finance minister said the move was regrettable especially after the Asian Development Bank (ABD) had indicated it was willing to provide such a loan based on the state government’s repayment ability.

“ADB will only provide loans for projects such as transportation and communications if their detailed assessment proves the borrower is able to repay the debt. It is clear that Penang has a good performance in financial management with annual praise in the Auditor-General’s Report,” the DAP secretary-general and Bagan MP said in a statement today.

On November 25, in a parliamentary written reply, Finance Minister Zafrul said the government had reversed the previous PH administration’s promise to guarantee the RM2.04 billion loan for Penang.

Zafrul said the decision was in line with the revised revenue and income projections for the country, as well as the government’s focus to restore the economy, following the Covid-19 pandemic.

Lim said Zafrul’s stance now differs from when he was a banker earlier, citing that the latter had approved a RM1.5 billion loan to the Penang Development Corporation (PDC), which is wholly owned by the state government. 

“Why when Zafrul was the CEO of CIMB he could approve a RM1.5 billion loan directly to the state government subsidiary PDC in 2018, but as the finance minister refused to approve the RM2 billion guarantee to the Penang state government? Until now, PDC has no problem repaying this RM1.5 billion loan in installments to CIMB,” he said. 

The former Penang chief minister said the LRT project in Penang is needed to overcome the urgent traffic congestion that will affect the state’s development into a developed and sustainable state. 

Lim hopes that Zafrul will reconsider the decision to cancel the guarantee to ADB and urged the federal government to facilitate instead of hinder Penang’s development. – November 29, 2020.