Penang’s debt reduction, a tale of prudence
This is in response to the news ‘ Don’t proceed with Penang dam project until Guan Eng says sorry, says Najib ’ ( Free Malaysia Today , 10 January 2021). Dato Seri Najib Razak claimed that Penang’s debt reduction was due to Barisan Nasional federal government’s giving “free grant for the Mengkuang dam worth RM1.2 billion and converting the state’s debt into annual instalments,” following the federal-state water restructuring deal in 2011. How the debt conversion works is by requiring the state government to transfer water-related assets to the federal government, and in return the assets are leased back to the state government for annual payment for 45 years. Najib then casted doubt over the DAP-led state government’s economic prowess and accused former Penang Chief Minister, Lim Guan Eng for propagating “fairy tales of reducing state’s debts.” This accusation against Penang government is not new, aggressively circulated by BN machinery in 2017, in preparation for GE14. To know whethe