ekonomisarawak

Saturday, June 6, 2015

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Thursday, June 4, 2015

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Thursday, May 14, 2015

Adenan walks the talk on illegal logging

KUCHING: The Malaysian Anti-Corruption Commission (MACC) has frozen 375 accounts totalling over RM560mil in its latest strike against illegal logging and timber corruption in Sarawak.

The MACC also seized more than 500 logs during a joint operation to clamp down on illegal timber activities.

Under Ops Gergaji, some 400 personnel from MACC, police, state Forestry Department and Inland Revenue Board raided 48 log ponds, sawmills and business premises across the state on Tuesday.

The raids were carried out simultaneously at 13 locations in Miri, 12 in Kuching and Sibu, six in Bintulu, three in Bakun and two in Kapit.

"We carried out the raids based on detailed investigations and intelligence obtained by MACC and the agencies involved," investigation division director Datuk Mohamad Jamidan Abdullah said in a statement.

He said further investigations would be carried out under Section 17(a) and 17(b) of the MACC Act as well as Section 4(1) of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.

"The joint operation shows the commitment of the Federal and state governments to combat corruption in the timber sector and curb illegal logging activities in Sarawak.

"Such activities are believed to have cost billions of Ringgit in losses to the Federal and state governments," he added.

Where Does Russia Go From Here

Bustari Yusuf and Pan Borneo Highway project in Sarawak Legislative Assembly

Y.B. Encik Chong Chieng Jen: No, no. Otherwise I will not have move the motion.

Otherwise I will not have supported the motion of Ahli Yang Berhormat Semop when he

hijacked my motion. All right, let me come back to my debate. With the State having its

rights on Sales Tax on top of GST, now we Sarawakian will be paying double taxes on oil

palm products, on tyres and also 4-D tickets. The other incident of Yang Amat Berhormat

failing to protect Sarawakian interest is the award of the Pan Borneo Highway projects. The decision-making process is controlled by the Board of Director of Lebuhraya Borneo Utara

(LBU), where the west Malaysian are the majority in the Board of Directors.

Six, Yang Amat Berhormat talks about closing down the internet gambling centres,

but 3 months later, many internet gambling centres are back in business, now some even

with the local council’s entertainment licences operating legally. They changed the machine

kuda to machine ikan. But they are operating legally with entertainment license but in actual

fact it is gambling operation...(interruption)

Tuan Speaker: You should assist rather than glorifying.

Y.B. Encik Chong Chieng Jen: Ya, I am assisting. I’m bringing this fact to assist the

government. Alright, number seven Yang Amat Berhormat talks about preserving the forests

and thus go hard on illegal loggings. Tuan Speaker, if you look at the figure that is provided

by the Minister in last week's debate, the actual culprit of deforestation in the State is not the

illegal loggers. We don’t condone illegal logging. Surely illegal logging must be stopped.

But the actual culprit of deforestation is not illegal loggers it is actually the policy of the

government. Why I say that Tuan Speaker? If we look at the figure annually our timber

production volume is about 10 million meter cubic ranging between 9 to 10 to 11. About 10

million meter cubic. Look at the illegal logs seized. Highest amount of volume log was in

2004. It was only 14,000 meter cubic it is hardly even 1% of the legally logging ...

(interruption)

Tuan Speaker: Yang Berhormat, you are in breach of Standing Order 32(3) because this

has been discussed ... (interruption)

Y.B. Encik Chong Chieng Jen: Okay, I will proceed of ... (interruption)

Tuan Speaker: You are repeating unless there is a substantive motion for the rescission ...

(interruption)

Y.B. Encik Chong Chieng Jen: Doesn’t matter. Alright, I’m just telling ... (interruption)

Tuan Speaker: You stop this ... (interruption)

Y.B. Encik Chong Chieng Jen: Okay I stop. I’ll go on to the next point ... (interruption)

Tuan Speaker: Alright, alright.

Y.B. Encik Chong Chieng Jen: With all the above seven matters, that I’ve mentioned, it is

abundantly clear that many announcements of his new policies have been neutralized or

rendered ineffective by the BN policies and the government agencies.

I have said before, to reform the system is not an easy task. Yang Amat Berhormat

will face many obstacles within the Barisan Nasional parties and the government

administration. What is required is a very strong political will.

We all want a better Sarawak for Sarawakian. Yang Amat Berhormat wants it. I

believe many of the Honorable Members from the other side wants it also, we also want it.

But we believe that a better Sarawak only can be achieved through transparency, good

governance, fair policies and a strong opposition to provide a check and balance in the

system.

As Yang Amat Berhormat has previously mentioned that, he is willing to listen to the

Opposition and also to work together with the Opposition. I, on behalf of the Opposition, wish to say that we are also of like mind. We can co-operate and work with the Government,

not in the sense of joining BN, let it be clear. Not in the sense of joining BN but by pointing

out the short-comings of the policies of BN. So that such policies can be changed for the

better.

Tuan Speaker, our words may be harsh, our criticism may be strong, but our

intention is good. I believe, together we can get rid of the dead woods and the rotten apples

in Barisan Nasional and the administration and strive a better Sarawak for Sarawakians. Not

a Sarawak for a few privilege Sarawakians and also not a Sarawak for a few selected

Sarawakians families. But a Sarawak for all Sarawakians.

Tuan Speaker, point number two on 20% oil royalty demand. Almost a year after

unanimous resolution in this august House on the 20% is oil and gas royalty, it is clear that

such demand is going no way. The Chief Minister is hitting brick walls on this matter and

has to openly seek help of the Prime Minister so that Petronas will accede to our claim.

Tuan Speaker, do not be so naïve about the so-called Prime Minister’s help.

Petronas is a company controlled by the Federal Government. If Prime Minister agrees to

accede to our demand for the 20% oil royalty, there is no way that Petronas cannot agree on

it. By now, if the Prime Minister agrees on this 20% of oil royalty demand, by now Petronas

would have agreed to it.

If one were to take into consideration of the oil royalty for the Federal Government,

the declared dividend and the tax revenue on the Petronas profit, the Federal Government in

total, is getting about 30% to 40% of the total revenue from the production of oil and gas in

Sarawak. We, instead are getting 5%.

Therefore the demand for 20 percent is only fair and necessary to put us Sarawak as

equal partners with the Federated State of Malaya. Now that the nice and cordial approach

as adopted by State Barisan Nasional is getting no way. We need a stronger and harsher

and more drastic measure to implement the resolution of this House.

Tuan Speaker: Such as?

Y.B. Encik Chong Chieng Jen: I will give you two suggestions. The first one, the first

suggestion is to use our immigration power and cancel the work permit of all the West

Malaysian currently employed at the executive and managerial level in the office of Petronas,

MLNGs and the subsidiary companies in Sarawak. Cancel their work permit. They cannot

continue to work in Sarawak. This will put a halt, maybe, a stop to its operation production

until the matter is finally sorted out. It may cause some loss of revenue but it is better to put

a halt to the production than to allow the continuous extraction when we are only getting five

percent royalty. Afterall, if the operation were stopped, oil and gas will still remain in our soil.

We have, Tuan Speaker, prohibited religious bigots and extremists from entering

Sarawak. Add on to the list, prohibits the robbers who plunder and robe us from our natural

resources. And this Petronas in a sense can be regarded as robbers who robe us, robe

Sarawakians of our natural resources. That is suggestion number one. Not so drastic.

Suggestion number two, more drastic. Join the National Pakatan Rakyat to form the

government. The figure will tell. Tuan Speaker, Pakatan Rakyat nationally has 86 MPs,

PSM has one, listen, listen ... (Interruption)

Tuan Speaker: No, no, no.

Y.B. Encik Chong Chieng Jen: Sarawak BN has 25 ... (Interruption)

Tuan Speaker: Order order. Your Pakatan Rakyat ... (Inaudible)

Y.B. Encik Chong Chieng Jen: Pardon? Federal, federal, federal level.

Tuan Speaker: Include ... (Inaudible) or not?

Y.B. Encik Chong Chieng Jen: Federal level ... (Interruption)

Tuan Speaker: So ... (Inaudible)

Y.B. Encik Chong Chieng Jen: You can ask from PKR. Ahli Yang Berhormat from Batu

Lintang. You will agree. Alright, Sarawak Barisan Nasional has 25 Members of Parliament,

Sabah has 22 Members of Parliament, just Sarawak Barisan Nasional joining force with

Pakatan Rakyat, we can get 112 MPs, just nice to form the federal government. It is in the

manifesto Pakatan Rakyat that 20 percent oil royalty be accorded to Sarawak. And with that

Tuan Speaker, once we step out this position, Sabah will follow soon. So all the 22 MPs of

Sabah will follow suit. The join force and we can get our twenty percent oil royalty.

Tuan Speaker: Ya, you have two minutes more.

Y.B. Encik Chong Chieng Jen: This is my suggestion Tuan Speaker. If they do not agree,

doesn’t matter. You have no right to say. At the end of the day you also have to listen to

your Chief Minister.

Tuan Speaker: Two minutes more.

Y.B. Encik Chong Chieng Jen: Number three, not enough Tuan Speaker. Tuan Speaker,

the appointment of Lebuhraya ... (Interruption)

Tuan Speaker: I have given injury time.

Y.B. Encik Chong Chieng Jen: Ya, thank you. Five minutes.

Tuan Speaker: No. I have given. That is why two minutes more.

Y.B. Encik Chong Chieng Jen: No lah. As the main contractor for the RM27 billion Pan

Borneo Highway did not go through an open tender process. Though LBU is a registered

company, has a registered address in Sarawak but four out of seven of its Directors are

West Malaysians. Therefore it is literally controlled by West Malaysian. Alright, though it

claims that the work will be distributed amongst Sarawak contractors, but this Sarawak

contractors will only be sub-contractors while the main-con, LBU will get the lion’s share of

the profit, the so called Ali Baba commission. Even during the initial rounds of meetings, the

engineer from the Kementerian Kerja Raya Malaysia, headed by the West Malaysian officers,

have been very condescending towards our local engineers and consultants, demanding

that the local engineers design the highway with cheaper and lower-quality designs, so as to

reduce the costs of construction.

Tuan Speaker, there are also political implication and ramification of this project.

Basically, this LBU is controlled by the Bustari Yusuf group who has close links to the top

leaders of UMNO. They are also aligned to the Federal Minister Fadillah faction within the

PBB. The implementation of this project will be carried out for at least another eight years.

During this period, the sub-contractors and/or the sub-sub-contractors will be beholden to

this group. In other words, the UMNO top leaders will yield their controls over the payments to the sub-contractors. When one controls the money source, he controls a lot of other

things.

I urge the government to be more wary on this aspect and its political implication. Let

it not be an opening for direct UMNO influence to set foot in Sarawak.

To avoid such a scenario, I propose that the State Government put its foot down now,

at this initial stage to take over the shareholdings and directorship of LBU, after all it is only a

shelf company, incorporated for the special purpose of getting this project. Therefore, it is

viable, it is feasible for the State Government to step in now and demand that the

shareholders be the Sarawak Government. And that our Sarawak Government officer be

appointed as Director.

Tuan Speaker: You have to conclude.

Y.B. Encik Chong Chieng Jen: Okay, one last point. Tuan Speaker, two quick ones. The

Wholesale and Distributors Association of Kuching, Samarahan Sarawak. They have

applied for a piece of land at 6 ½ mile, Jalan Penrissen, Lot 1798, Block 233, KNLD to

construct a whole seller market in Kuching here. We are a city, we have two mayors but we

do not have a whole seller market. I think it is time that the government approve this project

and they were told that this land will be given to Berry Tan’s Company again. So, I hope the

government will look into it and stop all these crony operation. The last one would be Best

House Development project at Taman Kota Sentosa. It is an abandoned project, and now I

have helped to appoint a liquidator and the liquidator come in trying to revive the project.

There are two impediments to these projects. One, is that one of the three parcel of land

that was amalgamated for the project has expired. Number two, is that condition for the

construction of low-cost houses.

Now Tuan Speaker, hundreds of purchasers have purchased the house and until

now there’s no OPs (occupation permit), right? Some of them have moved-in without OP,

some of them cannot move in because its 90%, 80% completed. So therefore, I urge the

government to step in. This is one of the largest abandoned projects, I’ve spoken about it

before and I urge the government to step in to waive the condition for the construction of the

low cost houses although it is in liquidation. Number two, to extend the leasehold of one of

the three parent title, parent lot, so that the developer, the contractor who are going to

continue with the abandoned project can legally and safely continue with this project. Can I

move on to another point?

Tuan Speaker: You have, you’ve to conclude, conclude.

Y.B. Encik Chong Chieng Jen: Dudong’s time, Dudong’s time ... (Interruption)

Tuan Speaker: You’ve to conclude.

Y.B. Encik Chong Chieng Jen: Pardon?

Tuan Speaker: You’ve to conclude, conclude.

Y.B. Encik Chong Chieng Jen: One last time, last time ... (Interruption)

Tuan Speaker: You’ve to conclude, Honorable Member, otherwise ... (Interruption)

Y.B. Encik Chong Chieng Jen: Last time, land matter, land matter ... (Interruption)

Tuan Speaker: To conclude.

Sunday, April 19, 2015

CMS given direct non tender over RM 300 million contract

KUCHING: Cahya Mata Sarawak Bhd’s (CMS) first major job win since 2009 consisting of the construction contract to design and build the Sarawak Museum Campus and Heritage Trail in Kuching could in analysts’ view be a prelude to more wins.

In an announcement on Bursa Malaysia, CMS said that PPES Works (Sarawak) Sdn Bhd (PPES), a subsidiary company of CMS Works Sdn Bhd which in turn is a wholly owned subsiary company of CMS had entered into a “Design and Build and Negotiated Contract” with the Government of Sarawak for the proposed Sarawak Museum Campus and Heritage Trail, Kuching, at a total contract sum of RM308 million.

CMS noted that the project comprises the design, construction, fitting out and exhibitory stable for a new world class museum and an adjoining annexe building with a combined total floor space of approximately 30,000 m2.

“The project also includes a heritage trail in central Kuching as well as the period conservation and exhibitory stable for the three existing historical museum buildings and of a pavilion.

“The overall duration of the contract is 60 months. The project is expected to be completed by the first quarter of 2020,” the group said.

According to the research arm of Maybank Investment Bank Bhd (Maybank IB Research), although CMS’ construction arm was established since 1990 and has a strong track record in constructing major infrastructures and buildings in Sarawak, the group has shifted its focus to road construction over the last few years.

“Hence, this contract represents its first major construction job win since 2009, lifting its outstanding orderbook significantly by 51 per cent to an estimated RM908 million,” the research arm said.

Assuming a gross margin of six per cent, Maybank IB Research forecasted a net profit contribution of RM14 million into 2020.

It noted that this translates into earnings per share (EPS) of 1.3 sen to be recognised overthe next five years.

“We maintain our forecasts as the earnings impact is minor,” it added.

Nevertheless, Maybank IB Research noted that this could be a prelude to more construction job wins in the near-term, especially that relating to the Pan Borneo Highway and Sarawak Corridor of Renewable Energy (SCORE).

Meanwhile, the research arm said that CMS’ cement and construction materials businesses are key beneficiaries of the growing construction activities driven by the upcoming Sarawak state election, Pan Borneo Highway works and 11th Malaysia Plan (11MP).

As such, Maybank IB Research maintained ‘buy’ on the stock while its RM5.00 per share sum of parts-target price is under review pending completion of CMS’ acquisition of Sacofa Sdn Bhd.

Sacofa plum only 50% purchase boosts CMS profits exponentially

KUCHING: Adding telco infrastructure provider Sacofa Sdn Bhd (Sacofa) to Cahya Mata Sarawak Bhd’s (CMS) portfolio will further enhance the latter’s recurring income base, say analysts at Maybank Investment Bank Bhd (Maybank IB Research).

“Overall, we are positive on the acquisition as it would further enhance CMS’ recurring income base,” it estimated in an April 3 report. “Based on Sacofa’s FY13 net profit of RM52 million — which we expect to be sustainable — the potential enhancement to our FY15, FY16 and FY17 net profit forecasts for CMS is four per cent, 6.5 per cent and 7.9 per cent respectively.”

To note, Sacofa’s FY13 revenue comprises rental proceeds from telecommunication towers leased out to telcos at about 67 per cent, bandwidth services (32 per cent), and fibre-optic network rentals (one per cent).

Over the years, Sacofa has constructed new telco towers across Sarawak to cater to the demand from mobile operators. Bandwidth usage has also risen in tandem as agreements were signed with the telcos to provide nodes fiberisation to their sites in order to support higher mobile internet speed such as 4G LTE.

The group currently has net tangible assets of RM344.2 million, non-current assets of RM453.2 million, current assets of RM303.6 million, non-current liabilities of RM243.9 million and current liabilities of RM174.7 million as at end-December 2013. It also has a net cash of RM31.8 million as of end-Dec 2013.

“Sacofa is a ‘one-stop centre’ providing telecommunication infrastructure to service providers in Sarawak,” Maybank IB added. “To facilitate Sacofa in achieving its objectives, the State Government granted Sacofa an exclusive right to construct, own and manage the communication infrastructure in Sarawak on the concept of sharing basis.

“At present, Sacofa operates more than 600 telecommunication towers, comprising mainly heavy duty towers and monopoles of various heights, throughout Sarawak. Sacofa leases its towers to the local telecommunication players including TM, Celcom, DiGi and Maxis.”

To note, Sacofa’s largest single shareholder is the State Financial Secretary (SFS) with a 70.51 per cent stake, followed by Celcom Axiata Bhd at 15.12 per cent, Sarawak Information Systems Sdn Bhd (SAINS) at 7.57 per cent and Yayasan Sarawak at 6.8 per cent.

Based on Sacofa’s reported FY13 net profit of RM52 million and net tangible assets of of RM344 million, Maybank IB Research stated that CMS is paying seven times on Sacofa’s earnings and 1.1 times profit per NTA. With just seven years left of its remaining concession period, it would seem that CMS is paying full value for Sacofa, it said.

“The upside would thus have to come from an extension to Sacofa’s concession period beyond 2022 and new businesses that Sacofa can bring to the table.”