☕️ PAC: Government paid RM6.08 bil for LCS ship, but not even a single ship was completed

1. MARKET SUMMARY

“Corruption is paid by the poor.”

— Pope Francis

2. NUMBERS AT A GLANCE

Who is the most hated footballer on Premier League on Twitter? Cristiano Ronaldo — 12,520 abusive tweets were hurled at the highest-paid football player in the world for the first half of last season, according to the Alan Turing Institute in association with Ofcom.

As of Tuesday, only 42.3% of children (1.5 mil) aged between five and 11 in the country have completed the Covid-19 vaccination. The Health Ministry is still continuing its efforts to encourage parents to get their children vaccinated, including through electronic and social media.

USD700-800 mil - the amount 15-time golf major champion Tiger Woods turned down to join the new Saudi-backed LIV Golf International Series and will maintain his allegiance to the PGA Tour.

USD20 mil+ — the amount of funding the Sulu sultanate heirs received so far by Therium to back their USD14.9 bil legal battle against the Malaysian government. Therium, a British-based firm, has repeatedly assessed the case’s merits and hired lawyers and researchers across eight jurisdictions in this case. The firm is in the business of providing capital finance litigations and lawsuits with funds raised from institutional investors, including a sovereign wealth fund.

3. IN MALAYSIA 🇲🇾

1. Malaysian leaders are really a breed that never learn from the past as we ought to see a Scorpene 2.0. This time around, a RM9.12 bil bil project for six littoral combat ships (LCS) is embroiled in a scandal after a two-year probe conducted by the Parliament’s Public Accounts Committee (PAC) found out that RM1.4bil from the project’s sum was misappropriated for other purposes. Below is the breakdown:Total cost? A whopping RM10.5 bil. The LCS project is the largest single procurement by the Defence Ministry, and it was directly awarded (🚩🚩🚩) to Boustead Naval Shipyard in 2011. Ahmad Zahid Hamidi helmed the Defence Ministry from 2009-2013. The government has paid RM6.08 bil, but not even one ship was completed. The PAC has recommended the MACC to take prosecutive action against those involved.

   1. RM700mil was cost overruns above the ceiling agreed in the contract. To put things into perspective, the government has paid RM6.083bil, but not even one ship has been delivered.

   2. RM400mil for an integration facility in Cyberjaya.

   3. RM305mil to repay previous debt incurred for an entirely different project.

2. In the government’s bid to justify the eye-watering RM50.2bil price tag for the MRT3 Circle Line project, the transport minister mentioned that the Circle Line would carry about 180,300 passengers per day when it is completed. To be fair, the figure is quite achievable as the daily ridership for MRT Kajang in 2019 is 204,821 passengers. However, this MRT3 project is more of a ‘want’ rather than a ‘need’ at the moment.

3. Different sides of the same coin — amidst the unfair pay mechanism for the delivery riders and the rising cost of living, delivery riders are unionising via social media to organise a strike on 5th August. Delivery riders will not be completing any delivery on the day, but it is estimated that only 40% of the riders will participate, as the rest need to work to feed their families.On the other side of the spectrum, Capital A announced that they would give full-time employment (including all the perks) plus a minimum RM3,000 monthly salary to their delivery riders.

4. Tun Mahathir unveils the new GTA (not the game), or short for Gerakan Tanah Air, in a bid to change the government in the next general election and contests 120 parliamentary seats against UMNO. The Malay-centric coalition consist of his party Prejuang, he National Indian Muslim Alliance Party (Iman), Parti Bumiputera Perkasa Malaysia (Putra) and Parti Barisan Jemaah Islamiah Se-Malaysia (Berjasa). Mahathir will only lead the coalition but he will not be the prime minister should they win the next GE.

5. Court cases but not on Najib Razak nor Zahid Hamidi:

   1. In Lim Guan Eng’s Penang undersea tunnel trial, key prosecution witness Zarul Ahmad stated that he lied to the press back in 2018 when he said all matters regarding the undersea tunnel project were ‘done above the board’. Zarul told the court that he was not being truthful at that time in order to protect the deal he had with Lim Guan Eng.

   2. In a libel suit by Terengganu Sultanah Nur Zahirah against Clare Rewcastle Brown for defaming the former ex-Terengganu Menteri Besar, Ahmad Said told the court that the Sultanah had nothing to do with the set up of Terengganu Investment Authority (that was then incorporated into 1MDB), contrary to the depiction in Clare’s book titled “The Sarawak Report: The Inside Story of the 1MDB Expose”.

Shorts:

1. After much criticism from the public for attempting to capitalise on the Generational Endgame (GEG) Bill, both Green Packet and Privasia Technology denied trying to get the government’s approval for an end-to-end system called Tobacco Track and Trace (TTT) to fulfil the requirement of section three of the Bill.

2. Sabah has now become a meme on how to not run a state as another video has gone viral showing some children crossing a river in sampan as the existing suspension bridge was washed away by floods last year. Some children have drowned in the past.

3. Recently, homegrown online retailer FashionValet online platform was shut down in a move to focus on dUCk and lilit brands. Here is an interesting read about this company that was given public funds by Khazanah and PNB back in 2018 instead of other homegrown enterprises at that time, such as Grab.

4. AROUND THE WORLD 🌎

1. Reviving the dead is one step closer — cellularly. Researchers at Yale School of Medicine restored cellular and molecular function in the organs of dead pigs one hour after death by pumping a blood substitute, a solution called OrganEx, throughout the animals’ bodies. The solution contains 13 compounds that slowed the decomposition and quickly restored organ function. One thing to note - although brain tissues were preserved, the pigs did not regain consciousness or sentience - it isn’t Dragon Ball yet. This is an important development to increase the number of organs available for transplant, as 20% of organs are discarded due to poor quality. 

2. Ukraine’s President Volodymyr Zelensky has appealed for direct talks with China’s President Xi Jinping to use its political and economic might on Russia to help end the war. In an interview with the South China Morning Post, Zelensky said this request has been made since the beginning of the invasion but has yet to occur. Interesting timing as the request is made against the backdrop of Pelosi’s controversial visit to Taiwan that has angered China. 

3. For such a small nation, Taiwan sure does have a huge leverage against China in the area of semiconductors — one thing the Chinese did not ban from Taiwan. China accounts for 60% of the global demand for semiconductors and relies on imports for 90% of its demand. Taiwan accounts for 64% of the industry’s manufacturing revenue and as much as 92% for advanced semiconductors. Despite spending billions, China only accounts for less than 10% of the market. 

4. Financial engineering:

   1. SoftBank Group Corp raised USD22 bil in cash by selling its Alibaba shares without actually selling them. The company sold prepaid forward contracts, a type of derivative, to banks such as Goldman Sachs and UBS to unlock the value of its holdings whilst still retaining ownership of the shares. 

   2. Facebook’s parent Meta, for the first time ever is considering a bond sale, potentially raising USD50 bil. The tech giant is one of the only 18 companies in the S&P 500 without any short or long-term debt obligations (debt free, in other words). The purpose of the funds? Possibly stock buybacks. The company still has over USD40 bil in cash and cash equivalents on hand. Then again, always better to use OPM (other people’s money) to juice up returns and performance. 

5. DC movie “Batgirl” has been scrapped by Warner Bros Discovery, an unusual development and unprecedented since the movie had completed filming and is in the test-screening phase. The movie costs USD90 mil to produce and stars Leslie Grace in the title role and Michael Keaton as Batman. The reason given by the company — “leadership’s strategic shift as it relates to the DC Universe and HBO Max”. 

5. FOR YOUR EYES 👁👁

1. Al-Qaeda’s leader Ayman al-Zawahiri was killed through a ‘flying blender’ or ‘ninja bomb’ that deployed blades to eliminate its target instead of explosives to minimise collateral damage.

2. Blind and visually impaired people are still able to enjoy movies through “audio description” — an example below of AD in The Lion King.