GEORGE TOWN: A year on, Penang is still upset at the federal government’s refusal to guarantee a US$500 million (RM2.1 billion) loan from the Asian Development Bank (ADB) for the state’s rail transit project.
Executive councillor Zairil Khir Johari said the loan was part of the bank’s green financing initiative.
“The Asian Development Bank offered the loan after a presentation to financiers and industry players at an Organisation for Economic Co-operation and Development event in Paris in 2019,” he said during the winding-up of his debate on the 2022 state supply bill at the state assembly.
Responding to an earlier question from Lee Khai Loon (PH-Machang Bubok) on why the federal government had refused to guarantee the loan, Zairil said he did not know.
“I don’t know why, you have to ask the finance minister.”
Last December, the finance ministry said it would not grant a government guarantee for a US$500 million loan application by Penang to partly finance its RM9.5 billion light rail transit project.
The federal government has the final say on states committing to loans from foreign entities.
On the Penang South Reclamation (PSR) project, Zairil said the first reclaimed island would have wetlands, floodplains, bioswales (or channels) to remove debris from rainwater and an 8ha mangrove forest.
He said the forest would have nurseries for fishes and prawns, with the mangroves doubling up as a carbon sink to help tackle climate change.
Other features in the reclaimed island project include artificial reefs, he added.
Separately, he said a special purpose vehicle for the PSR and Penang Transport Master Plan, the Penang Infrastructure Corporation, was allocated RM13.8 million last year.
He said the state-owned company did not use all the allocated money as these projects have yet to begin.
The funds were to pay for office space rent, furniture, salaries and miscellaneous purposes.