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PETALING JAYA – The outstanding debts of the littoral combat ships (LCS) procurement project that have not been paid for the past three years need to be settled as soon as possible to enable the vendors involved to continue their respective work, said Maritime Strategic Association of Malaysia (Mastra) Defence and Security Committee chairman Datuk Wan Othman Wan Ab Rahman.
Wan Othman said Boustead Naval Shipyard’s debts, estimated at RM1 billion to over 100 local vendors, had affected them financially, causing many workers to be laid off.
He said the settlement of all outstanding debts was important to enable vendors to proceed with their work to complete the six LCS.
“The first LCS, Maharaja Lela, is expected to be handed over to the Royal Malaysian Navy (RMN) in 2025.
“We have lost talents in this field as they had to move to other industries. We hope that the payments can be made immediately so that we can call back our experts and restart the project,” he told a press conference here today with several vendors involved in the project also present.
Meanwhile, MTU Services (Malaysia) business development director Wan Safwan Mohd Aris said they failed to complete some components of the LCS engine due to insufficient funds.
“We have completed several components of the LCS engine but the last engine could not be completed as the required funds were not paid,” he said.
Yesterday, Senior Defence Minister Datuk Seri Hishammuddin Tun Hussein said the cabinet unanimously agreed to proceed with the LCS procurement project.
He said the decision was made after taking into consideration two key factors, namely that the LCS assets are much needed by RMN and there are 400 vendors involved in the project, with a financial implication of over RM4 billion.
Hishammuddin said of the 400 vendors involved, over 100 of them were companies owned by Malaysians, with 90% linked to Malaysian Armed Forces veterans. – Bernama, April 21, 2022