At noon, 1MDB’s “five business day cure period” was scheduled to expire.
What do you call it when a “sovereign wealth fund” (or should it be “sovereign borrowing fund”) is unable to pay a debt? A technical default? Or something far more serious.
The alarm bells were already ringing a few years ago, when if not for RM5.0bn in property revaluation gains (paper gains) booked into the accounts, 1MDB’s shareholders’ funds would already have been in negative territory – a real sign of trouble.
Perhaps 1MDB will be able to negotiate a one-month extension period to sort out its “technical matters”. But the deadline, if missed, already leaves a bad taste in the mouth.
And a one-month extension would take us to 31 August 2017 – not the best way to celebrate the 60th Merdeka of the peninsula. Certainly, Jho Low won’t be popping any champagne bottles this time.
So we are now in uncharted territory. And many Malaysians simply cannot understand how the Pas leadership can say they are puas hati (satisfied) with 1MDB CEO’s Arul Kanda’s explanation. If anything, they should be demanding that he appears before Parliament to give a frank and detailed explanation.
Coincidentally or otherwise, the new tourism tax on foreign tourists (RM10 per hotel room per night) takes effect on 1 September.