KUALA LUMPUR: The government is confident that sovereign wealth fund Khazanah Nasional Bhd will return to profitability in the financial year 2019 following initiatives carried out under its restructuring.
Economic Affairs Minister Datuk Seri Azmin Ali said these included five initiatives launched since December to strengthen its financial position by reducing its debts.
“After about a year under the new mandate, Khazanah has reduced about RM8 billion in debts from RM55 billion to RM47 billion, and is expected to reduce this to between RM35 billion and RM40 billion in the medium term.
“The debt settlement was made through disposal (of assets) by Khazanah throughout 2018 and 2019.
“Part of the income was used for debt repayment, while a portion was used for new investments.
“For the financial year 2019, Khazanah is expected to achieve a RM5 billion profit, compared with the RM6.3 billion loss recorded in the financial year
Azmin was replying to a question by Datuk Seri Ahmad Hamzah (BN-Umno-Jasin) in the Dewan Rakyat today, who asked about Khazanah’s financial performance, as well as total disposal of assets, shares and interests made since Pakatan Harapan took over the administration.
Azmin said disposal of assets was a common business activity by Khazanah as an investment fund, as practised by the Employees Provident Fund and Permodalan Nasional Bhd.
He said Khazanah disposed of about RM18.8 billion of assets between May last year and June, of which RM3.2 billion of assets were disposed of between May
and December last year, and the remaining RM15.6 billion of assets sold between January and June.
“The revenue from this was used for new investments, as well as to repay debts, which have nearly reached its maturity.
“They were not used to settle the government’s debts. Payments received by the government from Khazanah are in the form of annual dividend and taxes," he said.