Commentary and Analysis

Latest Breaking News

Latest Videos

Your Ad Here

International auditing firm employed to audit PKFZ scandal (malaysiakini)

Malaysiakini's report:

International accounting firm PricewaterhouseCoopers (PWC) has begun auditing the controversial government 'soft loan' provided to Port Klang Free Zone (PKFZ), among other contentious issues.


lee hwa bengPort Klang Authority (PKA) chairperson Lee Hwa Beng told Malaysiakini that a six-member team led by a PWC senior manager has been conducting the probe.

“Auditing started this month and is expected to be completed by year’s end. Whether or not the report will be made public will be decided by the transport minister,” he said.

He said the audit team has been given authority to interview all current and former staff members as well as board members. Letters have been sent to all relevant parties and individuals involved in the probe.

ong tee keat pkfz klang visit 060508 05“We hope everyone will cooperate with the auditors,” Lee said.

He also said the appointment of an international audit firm is to build confidence that the probe is being conducted by an independent entity.

On why auditing has been delayed - when an announcement on this had been made in May - he attributed it to procedural requirements.

pkfz a rm 4.6 billion white elephant port klang free zone new version“PKFZ engaged the services of PWC by direct appointment instead of calling an open tender, he said. As such, approval had to be subsequently sought from the Finance Ministry.

The audit exercise was announced by Transport Minister Ong Tee Keat, following a public outcry over a RM4.6 billion ‘soft loan’ given by the government.

Ong said details of repayment would be properly audited and disclosed at the appropriate time, to avoid any misconception of a government bailout.

The project came to public attention after news reports raised issues linked to land acquisition and questioned if the project would become a 'white elephant'.

PKFZ, owned by PKA, was conceptualised as a regional hub for export and transhipment of manufactured goods costing RM1.85 billion. But the cost rose to RM4.6 billion by the time the project was completed.

‘Business picking up’

On PKFZ’s performance, Lee claimed that business has picked up. Since May, proceeds from annual rental have doubled from RM7 million to RM15 million.

“Besides operating the port, our job is to get more tenants to occupy the industrial buildings in PKFZ,” he said.

Lee and new chief executive officer Lim Thean Shiang were appointed to the PKA in May.

Ong had entrusted Lee with appointing the auditor and to assist the parliamentary Public Accounts Committee (PAC) should the latter conduct a probe.

Lee, however, said there has not been any follow-up on the matter by the PAC since he took over the post -