KUALA LUMPUR, Oct 21 — Finance Minister Datuk Seri Najib Razak said today the government will borrow RM5 billion from the Employees Provident Fund to fund government investment agency Valuecap Sdn Bhd.
"It's not part of the Consolidated Fund. It's a loan from EPF," said Najib.
The Deputy Prime Minister pointed out that the loan would not be part of the Budget 2009 allocations for spending announced last month.
Yesterday, Najib announced a host of measures to boost the economy and protect Malaysia from the effects of the global financial turmoil.
These included spending more on the service sector to cushion expected declines in Malaysia's exports.
Also, RM5 billion would be injected into Valuecap to buy undervalued stocks.
Valuecap was set up five years ago to invest in undervalued firms.
The government hopes the injection will offer much needed support for laggard blue-chip stocks in the local bourse.
The Finance Minister is expected to announce more measures on Nov 4 when he winds up the debate on the Budget in Parliament.
So far he has offered little details and did not spell out today the mechanics of the loan from EPF.
The government has already said it plans to slash costs by reviewing spending on government projects.
Today, Najib was asked if the cost cutting would affect the controversial acquisition of the Eurocopter helicopters for the Royal Malaysian Air Force.
"All projects will be reviewed but defence projects are to be assessed differently.
"We are looking at all projects, not just defence projects. Security projects cannot be measured on the economic yardstick. And that applies to the police as well," said Najib. ~ themalaysianinsider.com
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