DAP MP Tony Pua today refuted Najib Razak’s claim that 1Malaysia Development Berhad (1MDB) could have made a RM9.7 billion profit if Malaysia sold its Bandar Malaysia and enforce the Abu Dhabi guarantee of US$3.5 billion (RM14.7 billion).

Najib had said “since there was only RM17 billion of debt to be repaid, if Malaysia were to sell Bandar Malaysia for RM12 billion and enforce the Abu Dhabi guarantee of US$3.5 billion, 1MDB would make a profit of RM9.7 billion”.

“Yesterday, Najib claimed that 1MDB could have made RM9.7 billion in profit. This statement only confirms that our former finance minister is indeed financially illiterate,” Pua said.

“He wrongfully argued that if we sell Bandar Malaysia and enforce the Abu Dhabi guarantee, 1MDB can make a RM9.7 billion profit.

“It is utter stupidity to say that if the Abu Dhabi guarantee of US$3.5 billion could be enforced, and that’s a very, very big ‘if’ – the matter is in UK courts at this point in time – then 1MDB gets away scot-free, and will get to keep its remainder assets. Guarantees don’t quite work that way.

“Najib, as the then finance minister, signed a back-to-back guarantee with Abu Dhabi, on behalf of the Malaysian government and this meant that if 1MDB failed to repay the US$3.5 billion bond, and Abu Dhabi was required to fulfil the guarantee, then Abu Dhabi can make the claim against both 1MDB (whose current assets do not add up to anywhere near US$3.5 billion) and the Malaysian government. So the rakyat would have to pay, regardless of the guarantee.”

Pua said Najib could not differentiate between “a company’s ‘balance sheet’ and its ‘profit and loss’ statements”.

A balance sheet typically records a company’s assets and debts while the profit-and-loss talk about 1MDB’s accumulated revenue (very little) and cost (including massive interest expenses) over the past 13 years. Najib has completely messed up the two, Pua said.

He said the Bandar Malaysia land was owned by the government, therefore its entire proceeds should go to the government.

“Why should it be used to pay 1MDB debts when 1MDB had added zero value onto the land?

“Najib has shamelessly ignored the fact that the reason the remaining debt still has to be repaid by the government is ‘only’ RM17 billion, is because after he was deposed in 2018, the subsequent governments have successfully recovered a sizeable chunk of the money Najib has ‘misappropriated’ – to quote Finance Minister Tengku Zafrul Tengku Abdul Aziz’s reply in Parliament yesterday,” Pua said.

Today, Najib’s name was mentioned as one of 16 individuals who shared the funds stolen from 1MDB, pocketing US$756 million of the money raised from the sovereign wealth funds’ bond offerings. – March 15, 2022.