KUALA LUMPUR (Nov 15): Umno Youth Chief Asyraf Wajdi Dusuki has been told by Damansara Member of Parliament and DAP Publicity Secretary Tony Pua to know the difference between land value and total development value before speaking up on the matter.
On Nov 12, Asyraf had questioned Finance Minister Lim Guan Eng for not selling all assets belonging to 1Malaysia Development Bhd (1MDB) in a bid to settle its huge debt problem.
The Umno Youth Chief had claimed the land value at the Tun Razak Exchange (TRX), Kuala Lumpur’s new financial district developed by the sovereign wealth fund, was now worth RM40 billion.
“This is the quality of the present Umno leaders, who do not understand mathematics and economics as well as financial terms. They misuse figures and terms to deceive and mislead the people,” Pua said in a press statement here today.
The RM40 billion value that was always associated with the TRX project referred to the 'Gross Development Value' (GDV), or the total development value.
“GDV is a figure that covers all costs required to develop a project. This is very different from the value of assets or the profits that can be derived from the project.”
According to the latest assessment made by C.H. Williams Talhar & Wong on July 29, 2015, TRX's land assets are worth only RM2.8 billion, he said.
That amount, added Pua, was before the RM800 million loan related to the project.
It also did not take into account the RM2.8 billion in grants provided by the government to save the TRX project, which was nearly abandoned under the previous Barisan Nasional (BN) government.
Therefore, any sale of TRX land assets will not solve the 1MDB’s RM50 billion debt scandal, which was a result of mismanagement and abuse of power by Umno and BN.
The above valuation also did not take into consideration that TRX land assets were sold to 1MDB by the government at a modest price of RM230 million or just RM75 per sq ft.
“This means, the TRX asset is a government-provided asset to 1MDB, rather than a profit derived by 1MDB through its own efforts.
“Therefore, if the TRX land asset can be sold for RM40 billion as demanded by Asyraf, it constitutes a land sale owned by the government and Malaysians to pay off the 1MDB debt,” he said.