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NEWS ADMIN

Mahamad Rodzi Abdul Ghani

DATE

24/06/2003

NEWS PROVIDER

Mahamad Rodzi Abdul Ghani

NEWS SOURCE

Business Times

CATEGORY

HEADLINE

Counter-trade for dam project still on
Tuesday, June 24 2003 - THE Government denied yesterday rumours that aplan to partly pay for the construction of the Bakun Dam project in palmoil had been scrapped.

Primary Industries Minister Datuk Seri Dr Lim Keng Yaik said thearrangement to pay a Chinese-owned company in palm oil was still on andthat he had not heard of any cancellation.

This is the first time I have heard of this. As far as I’m concerned, thearrangement is still on, he told reporters in Kuala Lumpur after opening aseminar on using empty fruit bunches, a by-product of the oil palm tree,in pulp manufacturing.

A local daily had quoted sources as saying that Malaysia had scrappedplans to fund the payment of the Bakun hydroelectric dam’s main civilworks project through counter-trade.

The main contractor for the project is the Malaysia-China Hydro JointVenture (MCH JV), which comprises China National Water Resources andHydropower Engineering Corp (CNWR), Sime Darby Bhd, WCT Engineering Bhdand Ahmad Zaki Resources Bhd.

Under the plan, CNWR, which has a 30 per cent stake in the project, wassupposed to be partly paid in palm oil for the work done.

The company is representing China, Malaysia’s biggest palm oil buyer lastyear at 1.8 million tonnes.

CNWR, a unit owned by the Chinese Government, is the main technicalpartner for the project, having built the US$25 billion (US$1 = RM3.80)Three Gorges Dam project.

Malaysia is pushing for the use of palm oil as a mode of payment besidescash for several big contracts, including the double-tracking railproject, main battle tanks, fighter jets, submarines and medicalequipment.

Dr Lim, however, cautioned that counter-trade initiatives may be toneddown in future because there is only a limited supply of palm oil that thecountry can produce.