Govt loses twice from asset sales, says ex-MB

(FMT) – Former Selangor menteri besar Khalid Ibrahim said today that sales of national assets causes double the harm to the government’ finances.

“We lose twice,” he said at a forum. “We don’t have the assets and we are still in debt. And now we are forced to source for funds.”

He described the sales of holdings in several large companies as a sign of the government’s desperation in managing the country’s finances

Such action would also bring down the value of such assets, he said.

“For example, we want to sell off a company for RM1 million, but people will only offer us RM500,000 as they know we are desperate,” he said at a forum on the Challenges of the New Economic Policy.

Khalid, who once headed the strategic investment company Permodalan Nasional Berhad, had been asked to comment on the government’s sale of Khazanah Nasional Bhd’s holdings in several companies.

Khazanah divested its 16% stake in IHH Healthcare to Mitsui & Co for RM8.42 billion in November last year, and in July, announced it was selling the office and retail units of its DUO property development in Singapore, a joint venture with Singapore state investor Temasek.

On Friday, Prime Minister Dr Mahathir Mohamad defended the sales, saying they were needed to raise funds in a bid to clear debts incurred by the previous government.

But Khalid said that asset sales would make it difficult for the government to look for new sources of income for development.