Putrajaya to spend RM5.1b paying off 1MDB, SRC debts for 2019, 2020

Putrajaya will have forked out RM5.1 billion this year and next to pay debts taken out by 1MDB and its former subsidiary SRC International Sdn Bhd, which were allegedly misappropriated under the previous government, said Finance Minister Lim Guan Eng.

He said the sum, primarily for coupon or interest payment, is only for 2019 and 2020, and does not include the RM8.93 billion which the government has already paid for 1MDB.

The amount is expected to balloon in future when bonds taken out by 1MDB mature in 2022, and the entire principal must then be repaid.

As such, Lim said he concurred with Prime Minister Dr Mahathir Mohamad's statement that it was a "miracle" that the country did not go bankrupt.

"Mahathir spoke the truth when he said it was a miracle Malaysia did not go bankrupt as a result of the damage done by the previous kleptocratic regime which treated national funds as their own.

"As a result of that, some RM5.1 billion will be used to pay 1MDB's and SRC's debts for 2019 and 2020, money that could have been used for the people's welfare, but was 'robbed'," he said in a statement today.

Despite the challenges, Lim said the new government is still able to fulfil its obligations to develop the country and take care of the welfare of the people.

Lim said the latest payment was made last Friday (Oct 18) amounting to US$50,312,500 as coupon payment for 1MDB Energy (Langat) Ltd's bond totalling US$1.75 billion.

He added that the bond is expected to mature on Oct 18, 2022, when the full principal must be repaid.

Lim said this payment was made from the RM1.45 billion from the government's global recovery effort of the allegedly misappropriated 1MDB funds.

He added that there will be two more payments due for this year, namely US$52.4 million in coupon payment for 1MDB Energy Ltd on Nov 11, and RM143.75 million in coupon payment for 1MDB's Islamic Medium Term Note due on Nov 29.