Before I forget, I better record this for my future reference. It seems to me that PNB is departing from its original objectives of investing public funds in the stock exchange and obtain dividends by investing in good listed corporations. In an article in Utusan Malaysia, PNB plans to become another UEM which runs the tolled North-South highway through its subsidiary, PLUS.
PNB plans to spend some RM 2.0 billion to construct a 23 kilometre highway to network it with its 3 other highways that PNB is now owning/managing through its subsidiary called Prolintas. According to the CEO of Prolintas, Zainuddin A Kadir, by using this new network of highways, commuters are able to mimimise their toll fees, instead of using the 3 highways in a disjointed fashion. The CEO has not yet identified the path of the new highway further saying that it is privately finance initiative project which is another name for "privatisation". He goes on to say that the project is partially funded internally and partly through government efforts relating to land and others, whatever that means.
He goes on to say that, presently, Prolintas owns/manages 3 highways namely, the elevated highway from KL to Ampang, the Guthrie Corridor Highway, and the Bt Rimau-Shah Alam Highway. The CEO cites that on the average, the daily traffic volume through the elevated highway is some 60,000 vehicles and potentially rising to 93,000 in the future, while an average of 40,000 vehicles run through the Guthrie Highway in a day. What he does not say is whether the 3 highways are making money or not.
And yet another thing he says is that Prolintas may venture outside the country and that Prolintas has been invited by these countries (names not given) to undertake similar projects i.e. construct and operate. Prolintas or for that matter PNB seems to be ignorant of the UEM's bad experience in Manila.
Sometime in 1998, just as UEM was about to start its tolled highway in Manila, its operations was prevented by the courts when a lone Filipino sued the highway on the premise that before "he used the road for free, and now why should he be made to pay for the toll", of course conveniently forgetting that the road he used before was probably slightly better than a dirt track. The Manila courts, without thinking of the huge costs involved in making a highway out of a dirt track, adjudged in favour of the protestor and subsequently stopped UEM from operating the highway, preventing it from collecting tolls, which UEM desperately needed to begin paying for its huge loans. I don't know what happened after that - whether UEM abandoned the tolled highway to be taken over by Manila for free or otherwise.
Another example is Telekom Malaysia's joint-venture business with Ghana. After TM spent so much, in the hundreds of millions of ringgit, to revamp the country's telecommunication network, there was a change in the Ghanaian government. The new President was hostile to TM and TM was made to lose millions when Ghana's currency' the Cedi, was steeply devalued. The present government under John Prokuofor reneged on whatever agreement saying that the utility company made agreement with the previous government, and hence all previous agreements were null and void. All the installations set up by the utility company went for free to the African country. At least on a good note, Ghana was finally prepared to acquire TM's portion of the equity in the company that ultimately controlled telecommunication in Ghana in 2005. Its one good lesson for TM's adventure in Africa.
The moral of the story is that we Malaysians should not invest hundreds of millions of our precious ringgits in poor countries like those in Africa, or in countries like the Philipines. Better invest in our country where we poor rakyat will surely benefit, even if there is a foul-up somewhere.
In the former, government change hands at every coup, while in the latter, if the government is agreeable, then the military may object; and if both are agreeable, then the people may object, and if all three are agreeable, then the church may object and if all are agreeable, there will be somebody, some group, somewhere in the Philippines, will object and in the end, we Malaysians end up giving our hard-earned money to these ingrates. The funny thing is that before the projects get started and before money is spent, everybody seem to be agreeable and but only start to object when the project is completed. If we Malaysians still feel like investing in, say, Manila, since if we think we still we have a lot of cash, then invest in go-go bars, in strip joints, nightclubs, brothels and such likes, where capital returns are high, and risks on investment are relatively small. Never, never, never, be involved in mega-projects.
Rather than being a funds manager, PNB has now become a highway operator, and soon to be a contractor. By buying the Merdeka sports complex from UEM, at an undisclosed price, PNB is already a property owner and by turning the two stadia into a heritage property, it is now a guardian of Malaysian heritage. I wonder where PNB got its money from to buy this property. It wont be long before PNB starts being a conglomerate involving directly in many business ventures, without even consulting the shareholders of the funds.
