1MDB's debt payment plan and how it doesn't add up

KINIGUIDE | After almost two years of stripping 1MDB to repay its debts, its settlement plan, what the government calls "rationalisation", is reaching a close, with four more key assets or issues to be resolved.

The first two concerns 1MDB's land bank, namely the 310 acres of land in Pulau Indah, Selangor and 235 acres of land in Ayer Itam, Penang.

The other two concerns the redemption of 1MDB's US$2.5 billion in "fund units" and resolution of the US$3.5 billion it allegedly paid to Aabar Investments PJS (Aabar) but the latter claimed it never arrived.

A parliamentary written reply by the Finance Ministry outlined how the government planned to deal with these four items.

Malaysiakini, according to the written reply, lists here how the government plans to monetise the four items and to which debt the raised money will go towards paying.

In addition, Malaysiakini provides here the context of why the debts were raised and how they were used as well as the challenges the Finance Ministry will face, based on filings by the US Department of Justice.

ITEM 1 AND 2: 1MDB land banks

What does the government plan to do?

According to the Finance Ministry's parliamentary written reply to Beruas MP Ngeh Koh Ham dated Aug 1, the government intends to transfer the Pulau Indah and Ayer Itam lands to the Ministry of Finance Incorporated (MOF Inc).

After the transfer, the lands will either be sold and/or developed. The funds raised from this will go towards paying 1MDB's RM5 billion sukuk which will mature in 2039 and 1MDB Global Investment Limited's (1MDB Global) US$3 billion bond which will mature in 2023.

What was the RM5 billion sukuk for?

This was the first debt Putrajaya raised for the then Terengganu Investment Authority (TIA) in 2009, allegedly against the wishes of the Terengganu government and palace....