Mahathir: Some Malaysian state-owned entities may be listed

Some analysts have speculated the Malaysian government could list a small portion of its stake in state energy firm Petronas to generate revenue. (Reuters)
Updated 19 March 2019

Mahathir: Some Malaysian state-owned entities may be listed

  • Malaysia is saddled with debt and liabilities of more than 1 trillion ringgit ($245.52 billion)
  • A government panel to cut debt is looking at strategies

KUALA LUMPUR: Malaysia may list certain state-owned entities to cut government debt and liabilities, Prime Minister Mahathir Mohamad said on Tuesday as it seeks new revenue sources to boost its fiscal position.
Mahathir, elected in a stunning upset last year, has blamed the previous administration of Najib Razak for saddling Malaysia with debt and liabilities of more than 1 trillion ringgit ($245.52 billion).
A government panel to cut debt is looking at strategies, such as “identification of opportunities on potential asset monetization, which means mature unlisted government entities may be listed in the stock market,” he said.
State-linked companies could also pare equity stakes, he told a conference of investors in Kuala Lumpur.
“The key guiding principles for monetising any of our assets is that the disposal or monetization must never be done at fire-sale prices, and any disposal of shares, monetization of assets, auctions or other measures will be done in an orderly manner.”
He did not identify specific companies or fix a timeframe for the plan, however.
Sovereign wealth fund Khazanah Nasional announced a new strategy this month, saying it was gearing up to be a “long-term real return provider” to the government through its commercial investments.
Last month Reuters reported, citing sources, that Khazanah’s new strategy aimed at delivering more cash to the government by pruning stakes in non-strategic assets.
Some analysts have also speculated the government could list a small portion of its stake in state energy firm Petronas to generate revenue.
Petronas is the sole manager of Malaysia’s oil and gas reserves. Although some of its subsidiaries are listed on the national stock exchange, Petronas is fully owned by the government.
Finance Minister Lim Guan Eng said last year the government had no immediate plans to sell stakes in state-owned companies, but did not rule out the possibility in the future.
Lim and Mahathir have blamed corruption scandals in the previous administration for Malaysia’s large debts. The fiscal situation was also hurt after the new government scrapped an unpopular consumption tax, in line with a campaign promise.
Former premier Najib has been slapped with dozens of corruption charges since his defeat in May 2018, many related to alleged money laundering at state fund 1MDB.
He has pleaded not guilty and has consistently denied any wrongdoing.


Saudi minister: OPEC+ will take responsible approach to virus

Updated 26 February 2020

Saudi minister: OPEC+ will take responsible approach to virus

  • Saudi Arabia supports the further oil production cut, but Russia is yet to announce its final position on the matter

RIYADH: Saudi Arabia’s energy minister said on Tuesday he was confident that OPEC and its partner oil-producing nations, the so-called OPEC+ group, would respond responsibly to the spread of the coronavirus.

He also said Saudi Arabia and Russia would continue to engage regarding oil policy.

“Everything serious requires being attended to,” the minister, Prince Abdul Aziz bin Salman, told reporters at an industry conference in Riyadh.

An OPEC+ committee this month recommended the group deepen its output cuts by an additional 600,000 barrels per day.

Saudi Arabia supports the further oil production cut, but Russia is yet to announce its final position on the matter.

The minister said he was still talking with Moscow and that he was confident of Riyadh’s partnership with the rest of the OPEC+ group.

“We did not run out of ideas, we have not closed our phones. There is always a good way of communicating through conference calls,” he said.

Regarding the coronavirus, which has impacted OPEC member Iran, he said OPEC+ members should not be complacent about the virus but added he was confident every OPEC+ member was a responsible and responsive producer.

The flu-like SARS-CoV-2 virus, which first broke out in China, has now spread to more than 20 countries.

“Of course there is an impact and we are assessing, but we’ll do whatever we can in our next meeting and we’ll address that issue,” UAE Energy Minister Suhail Al-Mazrouei said at the same industry conference.

Saudi Aramco CEO Amin Nasser on Monday said he expected a short-lived impact on oil demand.

“We think this is short term and I am confident that in the second half of the year there is going to be an improvement on the demand side, especially from China,” he said.

Oil climbed on Tuesday as investors sought bargains after crude benchmarks slumped almost 4 percent in the previous session, although concerns about the global spread of the virus capped gains.