Friday, December 08, 2006

USD$100 milion commission for RM4.1 billion submarines contract – the real beneficiaries?

Deputy Defence Minister Datuk Zainal Abidin Zin denied in Parliament yesterday that the government had paid USD$100 million commission for the RM4.1 billion deal to buy three submaries from a collaboration of French and Spanish warship builders – DCN International and Thales respectively.

The deal concluded in 2002 involved the construction of two Scorpene SSK-class submarines (to be delivered in 2009) and an overhauled French Agosta 70 submarine for training purposes.

The contract was signed by the Ministry of Defence with Amaris – a joint-venture company between DCN and Thales.

The issue however was not whether the USD$100 million was paid by the Malaysian government but whether there was such a commission by the French contractor as the commission would eventually be added to the final bill of the contract to be paid by the Malaysian taxpayers, and who are the real beneficiaries of the USD$100 million submarine commission.

The issue of the USD$100 million submarine commission when the submarine contract was concluded in 2002 and the central role played by Abdul Razak Baginda (central figure in the Mongolian model murder case) had been raised in the previous Parliament, but no satisfactory explanation had been given.

Far Eastern Economic Review of August 15, 2002, in an article “Wanna Buy a Sub?” traced the makings of the submarine deal, which had not been denied. According to the FEER article, the company Perimekar “will receive, over the next six years, 8% of the total contract value: about 288 million ringgit, and possibly more, as the euro, on which the contract is based, has appreciated 13% against the ringgit since the signing”.

The 2002 FEER report said that Perimekar was 100% owned by Ombak Laut, “a private company owned by associates of Abdul Razak. Ombak then sold 40% to LTAT and a sister company.”

Can Malaysians expect an answer as to who are the real beneficiaries of the USD100 million commission for the RM4.1 billion submarines deal?

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