The government has no plans to privatise national carmaker Proton and the issue of a strategic foreign partner for the troubled firm will be resolved as soon as possible.

Second Finance Minister Nor Mohamed Yakcop was quoted by state news agency Bernama as saying that there were various options available for Proton but the one thing that would not happen "is that we are not taking it private."

The government is talking to both Germany's Volkswagen AG and US automaker General Motors on a possible alliance for Proton to provide technical expertise, stem a sharp decline in its market share and cut losses.

"We are really putting it on a fast track and trying to solve it as soon as possible. We are really trying except that we cannot make any announcement because discussion is ongoing," Nor Mohamed said.

"It is not that we want to hold back any information ... but there are certain things that are very sensitive," he said.

Need to protect nation's image

Separately, Bernama also quoted the Finance Ministry's parliamentary secretary Hilmi Yahaya saying the government will ensure Proton remains viable.

"The government will never let Proton die, not only to protect our nation's image and also because it is our national car, and it is still in a good position except that its performance has dropped," Hilmi said.

Proton last year lost its status as Malaysia's biggest-selling automaker to homegrown rival Perodua and recently reported larger than expected net losses of RM591.36 million for the year to March 2007.

State investment arm Khazanah Nasional is the controlling shareholder in Proton, with a 42.74 percent stake. State pension fund EPF and national oil firm Petronas own 12.07 percent and 8.84 percent respectively.