No commission paid for defence deals: Malaysian government

May 7th, 2008 - 1:30 pm ICT by admin  

Kuala Lumpur, May 7 (IANS) The Malaysian government did not pay any commission to any party for the purchase of French Scorpene submarines and Russian Sukhoi MKM fighter jets, Deputy Prime Minister Najib Abdul Razak said in response to the opposition’s demand in parliament for an independent probe into the deals. Malaysia purchased three Scorpenes for 4.5 billion ringgit ($1.4 billion) in 2002 and 18 Sukhois from Russia for 3.2 billion ringgit ($1 billion) in 2005.

Razak, who is also the Malaysian defence minister, said allegations of corruption were baseless as all the transactions were made in keeping with proper procurement procedures, The Sun newspaper said Wednesday.

He was responding to opposition leader Wan Azizah Wan Ismail’s demand Tuesday that Prime Minister Abdullah Ahmad Badawi set up an independent commission to probe the purchases.

Azizha, who leads an 82-member opposition, alleged that large amounts of commission were paid to finalise the deals.

Earlier, the Badawi government had denied giving political analyst Abdul Razak Baginda commission for the purchase of two of the Scorpene submarines worth $972 million for the Royal Malaysian Navy.

It had said that negotiations were carried out with the manufacturers Armaris (French) and Navantia (Spanish), which had obtained the approval of their governments.

A statement issued by Razak’s ministry said that a local company, Perimekar Sdn Bhd, was awarded a contract worth 114.96 million euros ($179 million) to provide support and coordination services for a period of six years. This was the amount that was misconstrued as “commission”.

The company’s job includes preparing accommodation facilities for 27 families and 156 submarine crew in France and Spain, preparing offices and health insurance policies for staff and crew, paying daily allowances of 50 to 60 euros per person and buying return flight tickets for the crew three times a year.

The ministry also clarified that the purchase of Sukhoi MKM fighter jets was made through direct negotiations with Russian company Rosoboronexport and the Russians had engaged a Malaysian company to facilitate its business transactions here at their own prerogative.

“But the ministry is not involved and has no interest whatsoever in any company appointed by the Russians,” the statement said.

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