PM: PFIs will be used to improve public transport
The Star – 27/4/2006
KUALA LUMPUR: Improvements to the country’s public transportation system will now have to be done via private finance initiatives (PFI) as the RM4.4bil gain from the cut in the fuel subsidy has been wiped out by higher global oil prices.  
Prime Minister Datuk Seri Abdullah Ahmad Badawi said the use of fuel subsidy savings was not possible at the moment.   
“PFIs will be used to improve public transport as this way has a better chance,” he said at a review of the transformation process of Government-Linked Companies (GLCs) and the launch of two new initiatives to improve the procurement process and to make the board of directors at GLCs more effective here yesterday.  The Government had planned to use the RM4.4bil it had saved by cutting the fuel subsidy on Feb 28 to improve public transport but the price of oil globally has risen from about US$60 per barrel then to about US$75 per barrel recently.  
Under a PFI, the Government will pay rent for the use of a facility or project over a long period of time. With the guarantee of rental income from the Government, banks will be more willing to bankroll such projects taken up by the private sector.  
Under the Ninth Malaysia Plan, the Government had identified RM20bil worth of PFI projects to go along with the RM200bil it would spend.   
Among the parties interested in taking up PFI projects is the Employees Provident Fund.  Abdullah also announced that Permodalan Nasional Bhd (PNB) would now take charge of developing the northern corridor of Peninsular Malaysia and Petronas the eastern corridor.  He, however, said the agencies for monitoring and executing development plans for Sabah and Sarawak have not yet been finalised.  
The development of the northern, eastern and southern corridors was part of the Ninth Malaysia Plan, where the objective was to spread economic development throughout the country instead of concentrating such activity in populated city centres.  The northern corridor, which comprises Seberang Prai, Kedah, Perak and Perlis, will be an area of borderless state where economic activity could be cultivated.   The eastern corridor, which is rich in oil and has vast petrochemical complexes, will cover Kelantan, northern Terengganu and western Pahang.  Khazanah Nasional Bhd is already in charge of developing the South Johor Economic Region. 
Source: The Star | http://thestar.com.my