Najib denies government facing financial woes


KUALA LUMPUR: Prime Minister Najib Razak says the government is not short on funds and will fulfil all obligations under the state-owned 1MDB.

He was referring to the statement released by 1MDB on Monday after it failed to make a US$603 million (RM2.6 billion) payment to International Petroleum Investment Co (IPIC), which was due on July 31, because of a delay it faced in receiving the money.

“It is a technical issue only. Not a question of us not being able to afford to pay back. It is not expected to disrupt the economy,” he told the Dewan Rakyat today.

Najib was replying as finance minister to a question from Dr Wan Azizah Wan Ibrahim (PKR-Permatang Pauh), who said 1MDB had failed to make the payments to IPIC, which would have been made from proceeds of a 1MDB rationalisation plan.

“The situation might disrupt the investor sentiments of those who want to invest in Malaysia,” she said during a question and answer session this morning.

In a statement yesterday, 1MDB said it was awaiting funds that were due in July.

“Due to the need for additional regulatory approvals, the receipt of those funds has been delayed to August 2017.

“As these are the funds which will be used to pay IPIC, 1MDB has written to IPIC to inform them of our commitment to meet the obligations, originally due on July 31, 2017, in August 2017,” it had said.

IPIC said in a filing it hasn’t received the payment, as well as a further US$26 million amount due on July 31.

Yesterday, former Batu Kawan Umno vice-chief Khairuddin Abu Hassan said the reported failure of 1MDB to make the payment proved that the government was facing problems.

1MDB reached an agreement in April to pay IPIC US$1.2 billion in two instalments. The state firm said payments would be made to IPIC by monetising investment fund units.