THE Boustead Naval Shipyard (BNS) CEO does not foresee the contract terminations of Contraves Advanced Devices Sdn Bhd (CAD) and Contraves Electrodynamics Sdn Bhd (CED) affecting the delivery of the littoral combat ships to the government.
In fact, the terminations will allow BNS to negotiate directly with the original equipment manufacturers (OEMs), who will remain involved in the project.
The contracts were awarded to CAD and CED because of their expertise and specialty.
But the CEO of BNS has implied that both these companies served merely as intermediaries and nothing more.
This is not surprising as that’s how most of the big government contracts are parcelled out.
If BNS is going to negotiate directly with the OEMs, what about the other contracted intermediaries in the LCS project who are sourcing overseas for the parts and equipment required for production?
Shouldn’t BNS be reviewing their contracts too?
Is BNS going to seek redress and compensation from CAD and CED for their role in the non- fulfilment of their contracts?
It is not enough to void their contracts alone when they have already been paid.
BNS has a legal and fiduciary responsibility to its shareholder, LTAT, to seek financial compensation from CAD and CED for their contract breaches.
Are the OEMs agreeable to continue supplying parts at the original prices?
If the prices have been raised, does BNS have the approval of the government to go ahead?
Defence Minister Hishamuddin Hussein has asserted that the government will not agree to any price revision until at least a couple of the ships have been delivered.
Former PM Najib Razak has said that the LCS project was awarded to Boustead to create jobs and opportunities for Malaysians.
How many local companies and workers and locals have benefited from the project?
Now that BNS has cut out the intermediaries and is dealing directly with the OEMs, how will this affect the government’s aim of local participation in the project? – September 10, 2022.
* FLK reads The Malaysian Insight.
* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.
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Comments
Posted 1 year ago by Crishan Veera · Reply
This is not surprising as thats how most of the big government contracts are parcelled out....."
Exactly.
Politicians abuse the NEP to direct award projects to their cronies at exorbitant prices and received huge kickbacks in return.
Government has to demand open tender with best business practices.
Many Malaysians (I for one) are still puzzled why TP was chastised for saving RM8 billion of taxpayers money.
Abolish NEP. Its the cause of all ills, eg producing crooked and idiotic leaders in all sectors of society. Other countries select their leaders on merit, intelligence, integrity, hardworking, etc.
Posted 1 year ago by Malaysian First · Reply