Minister Johari Ghani says government not beholden to China, when asked about report stating 1MDB repayment to IPIC was with money raised from companies linked to China.
The Singapore Straits Times had reported that the state-owned investment fund was able to make the US$602.7 million (RM2.4 billion) payment by divesting its stake in two companies, to buyers linked to Chinese state-owned enterprises.
Asked for some comment on the claims, Johari would only say that the government is in no way indebted to China for any future developments in Malaysia.
“We are in no way beholden to China,” he said, before asking reporters to get more information on the matter from Treasury secretary-general Mohd Irwan Serigar Abdullah, who is also the chairman of 1MDB.
The second tranche of the repayment of a US$1.2 billion loan IPIC extended in July 2015 to 1MDB, was made last Friday (Dec 22), ahead of the Dec 31 deadline that both parties agreed to in early April this year.
IPIC confirmed in a statement on Wednesday that “it has now received all the funds required to be paid to it under the Settlement with the Minister of Finance (Incorporated) Malaysia and 1MDB and the Consent Award made on May 9, 2017”.
The first part was settled in August.
Straits Times had quoted a source stating the second instalment was paid with funds raised from the sale of investments in financial instruments held by 1MDB and stakes held in two 1MDB-related entities that own tracts of land in Penang and another 128ha real estate parcel around Port Klang.
“Government officials declined to identify the buyers in the real estate transactions but one financial executive close to the situation had said that the equity interests in the 1MDB real estate entities were acquired by ‘concerns ultimately controlled by Chinese state-owned enterprises’,” the Singapore daily said in its report.
In a statement issued on Wednesday, 1MDB had said that all funds were paid from proceeds of its ongoing rationalisation programme.
For the first tranche, 1MDB had said in April that it would use investment units owned by 1MDB subsidiary Brazen Sky Limited to fund the payment.
The dispute between 1MDB and IPIC revolved around the IPIC loan and another US$3.54 billion in cash advances 1MDB claimed it made to several Abu Dhabi-controlled entities as part of obligations under a May 2012 bond arrangement.
IPIC claimed that it never received the monies from 1MDB, triggering a dispute.
The United States Department of Justice (DoJ) has filed several lawsuits seeking to seize dozens of properties and luxury assets that it claimed were purchased with funds misappropriated from 1MDB amounting to over US$3.5 billion.
The ongoing probe is one of several worldwide relating to 1MDB. Investigations have also been carried out in Singapore, Switzerland and Hong Kong.
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