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The founding chairman of Petronas and its first CEO, Tengku Razaleigh Hamzah said that the federal government in Putrajaya under Mahathir has been treating the oil and gas corporation as a cash cow, especially in bailing out government-linked companies in financial trouble.
https://www.thecoverage.my/3453/tengku-razaleigh-mahathir-squandered-from-petronas-rm-529-billion-since-1970s-bailed-out-mirzan-mokhzani#lfgp2rf1viklv18rn18
Petronas provided the money to build some of former Prime Minister Mahathir Mohamed’s most grandiose projects, including the KL Twin Towers, the Putra Jaya administrative capital and to bring Formula One racing in Malaysia.
Petronas was used to get Malaysia out of an RM31.5 billion forex scandal perpetrated by Mahathir in the early 1990s in which the financier George Soros outfoxed Bank Negara, making billions and earning Mahathir’s eternal antagonism. It paid off US$800 million in losses from Mahathir’s ill-fated Perwaja Steel project. In 1998, it bailed out Mahathir’s eldest son Mirzan, purchasing his Konsortium Perkapalan for RM226 million and assuming debts of more than RM324 million. It also awarded in 2012 a RM700 contract to a firm in which Mahathir’s other son Mokhzani was a vice president.
Tengku Razaleigh, or Ku Li, said that since its inception in 1974, Petronas has paid out RM529 billion to the government in the form of dividends, taxes, petroleum revenue and export duties.

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Mahathir Squandered From Petronas RM 529 Billion Since 1970s – Bailed Out Mirzan & Mokhzani
20 March, 2023
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The founding chairman of Petronas and its first CEO, Tengku Razaleigh Hamzah said that the federal government in Putrajaya under Mahathir has been treating the oil and gas corporation as a cash cow, especially in bailing out government-linked companies in financial trouble.
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Petronas provided the money to build some of former Prime Minister Mahathir Mohamed’s most grandiose projects, including the KL Twin Towers, the Putra Jaya administrative capital and to bring Formula One racing in Malaysia.
Petronas was used to get Malaysia out of an RM31.5 billion forex scandal perpetrated by Mahathir in the early 1990s in which the financier George Soros outfoxed Bank Negara, making billions and earning Mahathir’s eternal antagonism. It paid off US$800 million in losses from Mahathir’s ill-fated Perwaja Steel project. In 1998, it bailed out Mahathir’s eldest son Mirzan, purchasing his Konsortium Perkapalan for RM226 million and assuming debts of more than RM324 million. It also awarded in 2012 a RM700 contract to a firm in which Mahathir’s other son Mokhzani was a vice president.
Tengku Razaleigh, or Ku Li, said that since its inception in 1974, Petronas has paid out RM529 billion to the government in the form of dividends, taxes, petroleum revenue and export duties.
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He also said the government’s reliance on Petronas to rescue financially floundering government-linked companies (GLCs) had been going on since 1985.
Ku Li was the Minister of Finance from 1974 to 1984.
In 1985, Petronas bailed out Bank Bumiputra with a Rm2.5 billion infusion. In 1991, Petronas shored up the banks’ finances again when it pumped in an additional RM1 billion.
In 1997, he said Petronas had to rescue the troubled Konsortium Perkapalan Berhad for RM2 billion.
He added that Petronas was made to underwrite the construction of the KLCC Twin Towers for RM6 billion and the construction of Putrajaya for a further RM22 billion.
“This amount could have been used more productively to fund a national pension programme for Malaysians, as has been done by a certain Scandinavian country,” he said in his speech at the launch of the book “Rich Malaysia, Poor Malaysians” at the Sultan Sulaiman Club in Kuala Lumpur last night.
The bailout and construction of mega projects was done during the premiership of Tun Dr Mahathir Mohamad, who initiated a series of major infrastructure ventures in the 1990s.
Ku Li said the exorbitant amount of the bailout and construction of these projects that was forced onto Petronas had also deprived the company from the much needed cash build-up for reinvestment, which would ensure its business sustainability.
He said today Petronas was on par with oil majors and was ranked as one of Fortune 500’s largest and profitable oil and gas companies.
“But sadly, it is being abused and treated as the piggy bank whenever the government needed cash in a hurry,” he said.
Ku Li said while subsidising of consumer goods was not the most efficient of ways in managing the high cost of living, it was fairly understandable if the government extended a helping hand to the small man.
“What is sinful and cannot be forgiven is the ease with which the powers that be had been dishing out subsidies to such entities like the national power supplier, the independent power producers and some other non-power outfits,” he said.
During the last few months of Mahathir’s second stint as prime minister, he tried to look at possible ways Petronas could raise funds. One of his ideas was to break up Petronas into smaller business units, the Petronas Chemicals Group, Petronas Carigali, and Petronas Gas, selling equity off to Sabah and Sarawak state governments.
With tourism, air transport, and logistics depressed, national governments, including Malaysia will have to go deeper into deficit financing to pump their respective economies.
This is a dilemma for Petronas which will be under extreme pressure to pay some form of dividend to help the government manage the forthcoming budget. Without help from Petronas, the finance minister will have to canvas a reintroduction of the GST, maybe even at a higher rate than previously, increases of income and corporate tax, and even the introduction of new taxes. The company has been a major contributor to Malaysia’s wealth. However, times are changing where it may not be a dependable lifeline for much longer.
The Ministry of Trade and Industry (MITI) welcomes the allocation of RM1.585 billion for the ministry and its agencies as announced through the 2023 Budget by the Government today.
This covers a administrative allocation of RM625 million and development allocation worth RM960 million. This proves that the MADANI Government is committed to planning the country’s development in an inclusive and holistic manner which would further strengthen Malaysia’s position as a destination of choice for investment and trade as well as the gateway to the Asian region.
In statement today (Feb 24), MITI said although the country and the world are facing various challenges including the impact of the COVID pandemic, geopolitical uncertainty, global supply chain disruption, a gripping inflation rate, despite these in 2022, Malaysia recorded a performance that remains encouraging through approved investment value and exports whiich continue to strengthen the economy which now carries a value of RM1.42 trillion, exceeding the target of RM1.25 trillion by the year 2025 set under the 12th Malaysia Plan (RMK-12).
MITI Minister Tengku Zafrul Tengku Abdul Aziz said: “The budget focusses on three areas which comes under the ministry, namely industrial development, international trade and local and foreign investment which needs to remain intact in order to maintain the momentum of economic growth, sustain the supply chain and empower the development of Malaysia’s human capital.”
The 2023 Budget allocation to MITI and the 13 agencies under it will increase efforts to achieve these objectives. Among the main objectives to be achieved are:
1. Facilitating investment especially in the technology sector and high impact sectors, in line with the National Investment Policy, especially in terms of allocation of incentives to Local Authorities to facilitate the implementation of approved investments. These includes efforts to empower the investment environment in Malaysia through the Invest Malaysia Council and the National Committee on Investment (NCI) along with the. Malaysia Productivity Corporation (MPC) which will continue expanding under the scope of PEMUDAH at the state level.
2. Prioritisation of sectors with great potential such as Electrical & Electronics (E&E) and aerospace, in terms of tax incentives to transfer operations to Malaysia, and future C-Suite human capital income tax incentives increase investment by multinational companies for strengthen Malaysia’s position as an important destination in the industry’s global supply chain. This also goes hand in hand with the target of the new National Investment Plan (New Investment Plan) based National Investment Aspiration (National Investment Aspiration).
3. MITI through the Halal Development Corporation will work with Ministries and related agencies to ensure the implementation of Waqf MADANI with assets worth RM1 billion to meet the requirements target group.
4. Extension of the Green Investment Tax Allowance (GITA) incentive period and Green Income Tax Exemption (GITE) until December 31, 2025 with improvement of the incentive period to 5 years for green activities eligible is in line with MITI’s focus in enacting the framework national ESG for the manufacturing sector and related services.
5. Discussions will also be held with Bank Negara Malaysia (BNM) to facilitate the channeling of loan funds to start-up companies sustainable technology to help SME companies in the manufacturing sector transition to low carbon processes.
6. In improving the level of digitization and automation of the manufacturing sector especially PMKS, MITI also welcomes the funding funds below BNM that can be channeled to eligible companies.
7. Empowering the industry in terms of skilled workforce development (skilled labour), including the Academy in Factory (AiF) initiative that will provide opportunity for more than 50,000 trainees to carry out training while working at factory. This reflects the Government’s holistic approach to training TVET through public-private collaboration to meet energy needs skilled industry especially in the manufacturing sector.
8. MITI is also renewing and updating the Master Plan New Industrial Master Plan 2030 (New Industrial Master Plan 2023 or NIMP 2023) which will cover key issues, such as structural reforms, increasing the diversity (complexity) of the country’s economy, creating appropriate ecosystem for the target industry, as well as building the capacity of SMEs to apply ESG principles to meet the demands of the global market.
As announced in the 2023 Budget speech, NIMP 2023 which This renewal is expected to be completed in the Third Quarter of 2023.
This channeled budget simultaneously supports the main policies developed by MITI such as New Investment Policy based on National Investment Aspiration, National Automotive Policy 2020, National Policy on Industry 4.0 (Industry4WRD), National Automotive Policy 2020 (NAP 2020) and Framework National Trade Action 2021-2025. All these policies aim, among others, to build an investment ecosystem that offers catalysts (enablers) to foreign and local investors; mainstreaming Environmental, Social and Governance (ESG) principles to open wider market opportunities for the national industry, especially SMEs; and attract strategic industries, based on IR4.0 technology and have an impact high to provide high income job opportunities to the people local.
MITI and its agencies will continue to review and commit to strengthening national economic competitiveness through close cooperation with the private sector based on the concept of a pro-business environment in line with aspirations CIVIL Malaysia.
By Business Today Editorial -February 24, 2023
The Ministry of Trade and Industry (MITI) welcomes the allocation of RM1.585 billion for the ministry and its agencies as announced through the 2023 Budget by the Government today.
This covers a administrative allocation of RM625 million and development allocation worth RM960 million. This proves that the MADANI Government is committed to planning the country’s development in an inclusive and holistic manner which would further strengthen Malaysia’s position as a destination of choice for investment and trade as well as the gateway to the Asian region.
In statement today (Feb 24), MITI said although the country and the world are facing various challenges including the impact of the COVID pandemic, geopolitical uncertainty, global supply chain disruption, a gripping inflation rate, despite these in 2022, Malaysia recorded a performance that remains encouraging through approved investment value and exports whiich continue to strengthen the economy which now carries a value of RM1.42 trillion, exceeding the target of RM1.25 trillion by the year 2025 set under the 12th Malaysia Plan (RMK-12).
MITI Minister Tengku Zafrul Tengku Abdul Aziz said: “The budget focusses on three areas which comes under the ministry, namely industrial development, international trade and local and foreign investment which needs to remain intact in order to maintain the momentum of economic growth, sustain the supply chain and empower the development of Malaysia’s human capital.”
The 2023 Budget allocation to MITI and the 13 agencies under it will increase efforts to achieve these objectives. Among the main objectives to be achieved are:
1. Facilitating investment especially in the technology sector and high impact sectors, in line with the National Investment Policy, especially in terms of allocation of incentives to Local Authorities to facilitate the implementation of approved investments. These includes efforts to empower the investment environment in Malaysia through the Invest Malaysia Council and the National Committee on Investment (NCI) along with the. Malaysia Productivity Corporation (MPC) which will continue expanding under the scope of PEMUDAH at the state level.
2. Prioritisation of sectors with great potential such as Electrical & Electronics (E&E) and aerospace, in terms of tax incentives to transfer operations to Malaysia, and future C-Suite human capital income tax incentives increase investment by multinational companies for strengthen Malaysia’s position as an important destination in the industry’s global supply chain. This also goes hand in hand with the target of the new National Investment Plan (New Investment Plan) based National Investment Aspiration (National Investment Aspiration).
3. MITI through the Halal Development Corporation will work with Ministries and related agencies to ensure the implementation of Waqf MADANI with assets worth RM1 billion to meet the requirements target group.
4. Extension of the Green Investment Tax Allowance (GITA) incentive period and Green Income Tax Exemption (GITE) until December 31, 2025 with improvement of the incentive period to 5 years for green activities eligible is in line with MITI’s focus in enacting the framework national ESG for the manufacturing sector and related services.
5. Discussions will also be held with Bank Negara Malaysia (BNM) to facilitate the channeling of loan funds to start-up companies sustainable technology to help SME companies in the manufacturing sector transition to low carbon processes.
6. In improving the level of digitization and automation of the manufacturing sector especially PMKS, MITI also welcomes the funding funds below BNM that can be channeled to eligible companies.
7. Empowering the industry in terms of skilled workforce development (skilled labour), including the Academy in Factory (AiF) initiative that will provide opportunity for more than 50,000 trainees to carry out training while working at factory. This reflects the Government’s holistic approach to training TVET through public-private collaboration to meet energy needs skilled industry especially in the manufacturing sector.
8. MITI is also renewing and updating the Master Plan New Industrial Master Plan 2030 (New Industrial Master Plan 2023 or NIMP 2023) which will cover key issues, such as structural reforms, increasing the diversity (complexity) of the country’s economy, creating appropriate ecosystem for the target industry, as well as building the capacity of SMEs to apply ESG principles to meet the demands of the global market.
As announced in the 2023 Budget speech, NIMP 2023 which This renewal is expected to be completed in the Third Quarter of 2023.
This channeled budget simultaneously supports the main policies developed by MITI such as New Investment Policy based on National Investment Aspiration, National Automotive Policy 2020, National Policy on Industry 4.0 (Industry4WRD), National Automotive Policy 2020 (NAP 2020) and Framework National Trade Action 2021-2025. All these policies aim, among others, to build an investment ecosystem that offers catalysts (enablers) to foreign and local investors; mainstreaming Environmental, Social and Governance (ESG) principles to open wider market opportunities for the national industry, especially SMEs; and attract strategic industries, based on IR4.0 technology and have an impact high to provide high income job opportunities to the people local.
MITI and its agencies will continue to review and commit to strengthening national economic competitiveness through close cooperation with the private sector based on the concept of a pro-business environment in line with aspirations CIVIL Malaysia.
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