Penang’s secret RM2 billion loan being sought by the DAP govt

DAP mocked Kelantan for being broke while taking a secret RM2 billion loan for Penang

(FMT) – Chief Minister Chow Kon Yeow today said it is “regrettable” that Putrajaya does not want to guarantee a RM2 billion foreign bank loan for the proposed Bayan Lepas Light Rail Transit (LRT) project.

He said this was despite Putrajaya agreeing to guarantee the issuance of bonds by the state to finance the reclamation of the Penang South Islands (PSI) project last October.

This comes after Putrajaya said it would not guarantee a RM2 billion loan offered by the Asian Development Bank (ADB), citing increased commitments.

In a statement today, Chow said the state government would not give up on the LRT project and would consider other financial options.

In the meantime, he said, Penang would continue to remind Putrajaya that the state had come up tops in terms of approved foreign direct investments this year despite the Covid-19 pandemic.

He said this has boosted the country’s economy significantly, creating thousands of jobs in the northern region.

“We will continue to boost Putrajaya’s confidence to give Penang priority and equitable treatment on the financing of the LRT project,” he said.

The construction of the 30km Bayan Lepas LRT line, which will have 19 stations, is supposed to take off after the transport ministry approves it this month. It will cost RM8.5 billion.

Finance Minister Tengku Zafrul Aziz told Parliament yesterday the ADB had given three options to the federal government in January.

These were a direct loan to Penang with guarantees by the federal government; a direct loan to the federal government with relending to Penang; or a direct loan to a special purpose vehicle with a guarantee from the federal government.