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New mechanism for privatisation of highways needed

Last update: 13/10/2019
KUALA LUMPUR, Oct 13 -- The government through the Ministry of Transport has been urged to find a more transparent mechanism for the privatisation of highways especially as more highways will be built in the future, said economic analyst Pankaj C. Kumar.

He said a highway concessionaire company cannot hold the concession for too long, even exceeding 50 years of service, because it would not benefit consumers.

"All stakeholders including the Ministry of Finance and the Malaysian Highway Authority (LLM) need to sit down to discuss the new mechanism, which should take into account the factors on how to build the highway with or without concessions, and how long the concession should be,” he said when contacted by Bernama here on Friday.

He was asked to comment on the Budget 2020 announcement by Finance Minister Lim Guan Eng saying that the government had approved the acquisition of four Klang Valley highways from concessions involving the Shah Alam Expressway (KESAS), Damansara-Puchong Expressway (LDP), the Sprint highway (SPRINT) and the Stormwater Management and Road Tunnel (SMART).

Asked about his views on the government's aspiration to end PLUS concession contracts in 2038, Pankaj expects Khazanah Nasional Berhad (Khazanah) as a 51 percent-shareholder in PLUS Malaysia Berhad to buy the remaining shares held by the Employees Provident Fund (EPF), making it fully-owned by the Government.

“Khazanah and the EPF can discuss and come to agreement with reasonable suggestions on the true value of PLUS. That way, the EPF can sell its stake at a reasonable price, all EPF members will benefit indirectly after the sale.This is seen as a win-win situation,” he said.


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