The Battersea Power Station redevelopment scheme as of September 2017 (Fæ/Creative Commons)

Malaysia to investigate Battersea Power Station property deals

13 June 2018 | By GCR Staff 0 Comments

As part of a widening probe into corruption, the new Malaysian government will investigate “dubious” Malaysian state investments in the UK, including deals concerning London’s Battersea Power Station, a senior politician has said.

Anwar Ibrahim, leader of the Pakatan Harapan coalition that ousted former prime minister Najib Razak at the 9 May election, said a number of deals entered into by Malaysian state funds had to be investigated, and would be renegotiated if any wrongdoing was discovered.

Malaysian opposition leader Anwar Ibrahim speaks at a rally in Penang on 11 May 2013 (Firdaus Latif/Creative Commons)

The politician, who spent nine years in prison while in opposition, called on the British government to investigate Malaysian money laundering, appealing specifically to British foreign secretary Boris Johnson for help in uncovering “reckless spending sprees” by state funds.

“All these deals which are considered dubious, including investments in housing in London, will have to be investigated. Yes, that includes Battersea. Because they were made using state funds. We have to be convinced that this was the right investment decision and that there was no political influence or direction,” Anwar said in an interview with UK newspaper The Guardian during a visit to London to meet British ministers.

In January, the Malaysian developers of the £9bn Battersea regeneration scheme announced they had agreed to sell stakes in the power station building, together worth £1.6bn, to two Malaysian state-linked investment funds, Permodalan Nasional Berhad (PNB) and the Employees Provident Fund of Malaysia (EPF).

PNB and EPF already own around 70% of the entire project directly and through their holdings in the current developers.

In 2012 Malaysian developers SP Setia and Sime Darby bought the 39-acre site of the decommissioned, iconic power station on the Thames and began its long-planned commercial and residential redevelopment. Apple plans to locate its new UK headquarters there.

Yesterday, shares in SP Setia and Sime Darby slumped in the wake of the interview, which was published on Monday, 11 June.

Anwar said the Najib government had used the savings of Malaysians to cover up an alleged multi-billion-dollar embezzlement scandal at 1MDB, another state investment fund that was set up in 2009 by the Najib government, and which was declared insolvent last month with debts of $18bn.

The new government of Prime Minister Mahathir Mohamad, who is chairman of the ruling coalition, initiated a sweep of state finances immediately after the election and launched an investigation into Najib, who is barred from leaving the country and has had properties raided. Najib denies any wrongdoing.

As part of that sweep, Malaysia cancelled the planned high-speed railway from Kuala Lumpur to Singapore.

The Mahathir government also scrutinised the Chinese funded $14bn East Coast Rail Link project, but has concluded it is too late to cancel it.

Now, the government has turned its gaze on foreign property deals.

“It’s clearly a political decision to invest,” he told the Guardian. If there is something wrong then we will want to renegotiate. We are looking at umpteen deals extending to hundreds of billions of ringgit – that is tens of billions of dollars.

“You look at every deal from housing in London to railways built by China. It’s baffling to me and I was monitoring the policies of Najib and attacking him ferociously. But even I am shocked to the extent he seems to have gone to to earn more to cover up the 1MDB fiasco.”

Anwar appealed to the British government for help in fighting corruption, telling the Guardian that the money trail of the 1MDB fraud ran through London.

“There was no attempt by British authorities to investigate. But this was a crime using sovereign wealth funds for reckless spending sprees. I am seeking support from the British government and from the foreign secretary, Boris Johnson,” he said.

“I say to Britain: you talk about transparency and anti-corruption drives, now is the time for action. I am saying now allow the institutions to conduct investigations fairly and give the necessary cooperation.”

He called on Britain to follow the example of Singapore, where he said people have gone to prison and banks have been closed down for their role in laundering 1MDB cash.

“Look, the last Malaysian government did not want the British to be involved. But we are now giving them a mandate to investigate,” he said.

Top image: The Battersea Power Station redevelopment scheme as of September 2017 (Fæ/Creative Commons)

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