SOLID SUCCESS – BAKUN DELIVERS ON REQUIREMENTS

Kuching
Tuesday, 21st September 2010

News publications have been chewing over the figures as Bakun waits to be flooded and have come to some inevitable, long-predicted conclusions.

Firstly, the Dam has no genuine economic purpose. Sarawak already has more electricity than its impoverished population can afford to use and the plans to send it to Malaysia by undersea cable was a fantasy by technology-illiterate ministers.

Secondly, the dam will actually make electricity more, not less expensive for ordinary Sarawakians, as existing power plants will be shut and Sarawak Hidro are desperate to claw back some of the RM 7.3 billion costs.

Thirdly, the public worker pension funds, which were arm-twisted by politicians into funding the dam to the tune of RM 5.75 billion, are now left facing an appalling loss. This means either a whole generation of hard-working public servants (teachers, nurses, clerks, firemen etc.) will now lose their savings for old age, or the Malaysian taxpayer (the next generation of workers) will have to find the extra money to bail them out.

Pensioners’ loss is Taib family gain

plenty of cement and steel

Therefore the all-round conclusion has been that Bakun is a monstrous, multi-billion dollar disaster. Southeast Asia’s greatest ‘White Elephant’ foisted onto Malaysia Peninsular by Sarawak’s ‘Chief Executive Officer’ Abdul Taib Mahmud. Perhaps, it is speculated, at least tourists will come to visit such an appalling example of state planning gone spectacularly wrong?

However, these commentators are neglecting to point out that from the point of view of Mr Taib’s personal finances and those of the Taib family, the Bakun Dam has been a stunning success.

Much of the RM 5.75 billion siphoned out of the Employees Provident Fund (EPF) and Kumpulan Wang Persaraan (KWAP) by this project has gone gushing straight into the Taib bank accounts – and then presumably straight on out of the country to fund their private foreign investments.

CMS saved from bad business judgements by Bakun

Researchers have long since detailed how it was the decision to revive the Bakun Dam project, after it was shelved during the Asian Financial Crash, that rescued Cayha Mata Sarawak (CMS), the business the Taib family ‘privatised’ from the state into their own pockets, in the late 1990s.

By 1999, CMS, which had over-stretched on ambitious projects, was facing terrifying losses of RM 787 million. The Chief Minister (whose late wife and two sons owned most of the shares of this ‘public’ company) was even more alarmed as the share price collapsed as a result. The ‘CEO of Sarawak’ was facing personal bankruptsy, since most of his family company’s borrowings were based on the value of these CMS shares.

Environmental catastophy - an area the size of Singapore has been stripped bare for flooding

So it was the political decision by the Malaysian government to pour RM 1.6 billion of taxpayers’ money into Bakun (a sum which has since escalated to 7.5 billion and rising) that saved the Taibs’ from ruin (and kept BN in power in Sarawak). Everyone knew that the Chief Minister would award his own company the lions share of the contracts for this glorious mega-project (CMS specialises in producing cement and steel) and that the company would go from strength to strength.

Endless profit to be made

The Chief Minister does not miss a trick when it comes to making money and Bakun has gone on to provide wonderful further opportunities for abuse of public trust. Thus, his own company CMS has now gone on to further establish itself as the biggest private customer of the publicly owned venture that it built.

The company has done a deal with Rio Tinto Zinc (despite the horror of environmentalists) to build a vast aluminium smelter to soak up Bakun’s excess power. This consortium is currently playing hardball with Sarawak Hidro, the Federal government body in charge of the dam, to get a preferential deal for electricity. This at a time when Taib is negotiating on behalf of the State of Sarawak to buy the project off the Federal Government.

This means clever Taib has set himself up as the biggest client of the state venture that, as Finance Minister and Chief Minister, he is going to be entrusted with managing of behalf of the interests of the taxpayer! As far as conflict of interest goes that is about as big as it gets!

Aluminium smelters - get ready for the pollution

Meanwhile, Sarawak Report wonders whether his business partner, Rio Tinto Zinc, has considered dusting off its own ethics book on this issue, and leafing through to the section on doing business with corrupt tyrants?

Clearly, the opportunity to move politically sensitive and highly polluting aluminium smelting plants out of Australia, where the mineral is mined, and into Sarawak is tempting. Taib, of course, plans to cover the whole of this once pristine rainforest state with filthy foreign industries to foul up what remains of the dammed up river basins – the so-called Sarawak Corridor of Energy.

However, while the Chief Minister regards himself impervious to criticism and bullet proof at the ballot box (no fool like an old fool), the business executives at Rio Tinto have learnt the hard way about the dangers of deals such as these. Their local back yard environmentalists in Australia may be happy to see them move off, but the global environmentalists will be only too ready to hold such actions to account. And the native peoples of Sarawak are not that happy either, to put it gently.

Moveable inconvenience – displaced people at Sungai Asap camp, Bakun

No benefit to Sarawak

Citizens of Sarawak have also learnt the hard way that the jobs from dirty industries such as these will go to foreign workers and the money will go straight back out again. They know that ’Progress and Development’ , Taib-style means environmental destruction, land seizures and poverty for the many and vast riches for….. well Taib.

All of which explains why the multi-billion dollar plan to go on building pointless dams across the whole of the rest of Sarawak, displacing tens of thousands more indigenous people and destroying vast areas, while appearing to be the strategy of a mad man makes enormous economic sense personally to Abdul Taib Mahmud.

This is because China has agreed to invest US $11 billion to do it. Most of that money he reasons will go to him and after that who cares that the people of Sarawak will be in debt to China and therefore under China’s control for ever more?

Original article was published in Malaysia Report

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Malaysia's Bakun dam - a monument of corruption?

Kuching
Sunday, 12th September 2010

The multi-billion-ringgit Bakun dam in Sarawak, already condemned as a catastrophe for the environment and the tribal people, is now battling suggestions it could become a giant white elephant.

The dam, that will eventually submerge an area the size of Singapore, is finally nearing completion after suffering a series of setbacks and delays since its approval in 1993.

But at the last hurdle the project has stumbled again, with delays in winning the state government's permission to begin the flooding process and no takers yet on purchasing its hefty 2,400 megawatt output.

With ambitious plans for an undersea cable to feed Bakun's electricity to the Malaysian peninsula now abandoned, the Sarawak government is the only feasible buyer - leaving it with a very strong hand.

Negotiations not going smoothly

Negotiations with the dam developer Sarawak Hidro Sdn Bhd, a subsidiary of the national finance ministry, have reportedly been tough.

"It's a case where the owner of the project is naming an asking price that is very different to what the buyer would want," said Wong Chew Hann, an analyst at Malaysia's top bank Maybank.

"I understand there's quite a huge mismatch," she said. "I'm not sure what they've incorporated into the pricing, but the cost of the project has gone up so much since it was started."

As well as the cost of construction, there is the expense of compensating tribal people for their forced relocation from ancestral lands, and suppliers affected by the long delays.

"So the question is, are you going to incorporate all the compensation costs in the tariff price?" said Wong.

With the indigenous people from the Bakun catchment area long since resettled and its valuable timber resources long since felled, the dam has been ready to be flooded since April.

The state government had delayed permission, saying it was still evaluating river levels and the impact on boat transport.

A Sarawak minister reportedly said last week that the necessary permit has been granted, denying both that it had been used as a bargaining chip to lower the tariff and that Sarawak was facing an energy glut.

Not held to ransom

Sarawak Hidro managing director Zulkiflie Osman played down suggestions that he has been held to ransom by the state government.

"Both parties are working together and want it to be settled amicably, with a tariff acceptable to both parties," he told AFP, adding that he expected to strike a tariff deal before December.

The next of Sarawak's mega-dams, the Murum, which is being developed by the state government, is due to come on line in 2013 but Osman said he was convinced the state authorities will not bypass the Bakun in favour of its own project.

Alongside the power purchase negotiations, the federal government is also said to be discussing selling the entire Bakun facility - built at a reported cost of RM7.3 billion - to the state government, but pricing and finance problems have emerged.

Star daily reported in July that the federal government was seeking RM8 billion while the state government offer was just RM6 billion.

The Bakun's output far exceeds existing energy needs in Sarawak, a relatively undeveloped state, and is mostly destined for industrial users such as aluminium smelters, but these are still on the drawing board.

"The main problem is that currently there is no demand for such a big capacity yet, and in order for Sarawak Energy to purchase the dam they would need adequate funding," said an analyst with a major research house.

"The banks would ask for some kind of feasibility study, and as there is no real demand yet this project risks becoming a white elephant," said the analyst, who declined to be named.

Newspaper reports have questioned how the federal government can ever hope to recover the huge amount of money it has sunk into the project.

'Non-starter'

"Marred by too many disagreements, the RM7.3 billion project could very well turn out to be a non-starter," Star said last month, adding that with both the Bakun and Murum dams online there would be a "very real possibility" of a power glut.

Transparency International has labelled Bakun a "monument of corruption" in Sarawak, a state that has been ruled for three decades by the formidable Chief Minister Taib Mahmud (right).

There has also been fierce criticism over the botched relocation of 15,000 indigenous people, who have made an unhappy transition to life in drab resettlement areas.

Baru Bian (left), chairman of the opposition party Keadilan in Sarawak, said the Bakun project was designed purely to profit cronies, and not planned in the public's interest.

"The dam is a waste of public funds, it's not necessary, and what is paramount is that it is disturbing and disrupting the lives of the natives and the environment - the trees and the forests."

- AFP

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BN Real Politic Of Development ?

Brunei to get 400MW of our electricity

The state is expected to supply 400 megawatts (MW) of electricity to Brunei next year.

According to Awang Tengah, the memorandum of understanding (MoU) had been signed with Brunei sultanate last May. He Said the supply would be delivered in two stages. (1) First stage. The supply of 200MW from Bakun Hydroelectric Dam after its commissioning next year

(2) Second Stage . Another 200MW , the supply will come from Limbang Hydroelectric Dam.

This was what Taib Mahmud meant by the Politic of development....Developing others first...The Rakyat last.Despites the facts that 85% of the longhouses throughout the state are living without basic amnities and electricity but BN government still can afford to sell it electricity to it neighbouring countries, Kalimantan Indonesia and Brunei.

I still fail to understand until now, why the Dayak of sarawak, despite what BN has done to us, we still throw our support to them.

Please follow my Countdown for Dayak Victory!

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