SHAH ALAM: Business daily, The Edge, is reporting that the MACC has started investigating alleged impropriety in the FLIT/LCA tender. The publication is also saying that the Korean Aerospace Industries (KAI) T/FA-50 was the front-runner for the tender.
From The Edge
KOREA Aerospace Industries (KAI) has emerged as the front runner to secure a RM4 billion contract to supply the Royal Malaysian Air Force (RMAF) with 18 light combat aircraft (LCA), according to sources familiar with the outcome. However, the award is said to have triggered an investigation by the Malaysian Anti-Corruption Commission (MACC), following a complaint by one of the unsuccessful bidders.
The anti-graft body is understood to have opened a case file on the matter based on documents and text messages sighted by The Edge.
MACC declined to comment when contacted.
Meanwhile, caretaker Defence Minister Datuk Seri Hishammuddin Hussein assures that the contract is being handled professionally by those responsible for the multi-billion ringgit deal.
The report quoted a Datuk Lau Kong Cheng, a consultant to one of the bidders as saying that the Finance Ministry should not be negotiating with KAI as the current government was only a caretaker and therefore had no right to enter into any contracts. Lau is quoted in in November 1 Harian Metro report which stated that one of the bidders for the FLIT/LCA had lodged a police report alleging impropriety with the tender process. The report quoted Lau as a retired Brigadier General and the managing director of Paragon Avtech Sdn Bhd. (A Google check showed Lau was a former fighter pilot). The report did not say which aircraft the company had bid for the tender
However, an earlier Harian Metro report quoted Lau as saying the Avic JF-17 Thunder was a better plane than the South Korean aircraft which meant the company was representing the aircraft. The report also quoted Lau as saying that the company had also bid for the MALE UAS tender (AFAIK, no police report was lodged).
It is likely the police forwarded Lau’s report to the MACC for further investigations as it found that the alleged impropriety was in the powers of the commission (or he himself lodged a report with the MACC). As I have no current contacts with the MACC, I guess we will have to wait for the commission or the Edge to announce new developments on the case. Malaysian Defence had reported previously that the FLIT/LCA decision rested with the Finance Ministry. With a new government expected only by Wednesday at the latest, I guess the final decision on the tender will not be made any time soon. The new government will need to
come up with a new budget first.
— Malaysian Defence
If you like this post, buy me an espresso. Paypal Payment
View Comments (21)
Perhaps H2O can publicly threaten to come after MACC Commissioner for daring to investigate this tender matter. After all if it works for someone...
We've reached a stage where it is the norm for companies which have lost out to make claims of corruption or irregularities. Also, the esteemed former Brigadier General was talking rot he Saud that the JF-17 was "better". There is no "better"; only what comes the closest to meeting specific requirements of individual users and ultimately it will be the key enablers which will enable the platform to be utilised to its full potential.
RM4 billion for 18 units or usd$47 milion each. Is training and tools included?
It is still a fair price although higher than pinoy's FA-50 blick 10.
Our neighbour...ID really walk the talk about modernization their fleet.
They already provided usd$3.9 billion to get batch 2 rafale F4 and ex Qatar AF mirrage 2000-5EDA. Tbe US-ID already agreed on the F15 waiting for their finance minister approval.
Without more details on the equipment and other stuff specific for RMAF and likely TOT costs, its hard to determine whether the price is comparable with other buyers. The Indonesians are relying on loans to finance the procurements. We do not want to go down that route
Make SPRM bigger and stronger
So many task for them lately, and covering almost every aspect of money matters in everydays life of rakyat Malaysia.
Philippines cost includes the set up of simulator center in the Philippines.
http://www.pna.gov.ph/articles/1072419
Things that could be included in RMAF cost
- Setting up simulator center/virtual learning center.
- Korean weapons such as glide bombs etc.
- specific RMAF mods, but I believe we don't have to pay much for this as Poland has signed the contract before RMAF, and we can just opt to have the same thing Poland has without the need to pay for R&D (let Poland pay for them instead). So I believe the cost on the actual signing could be lower than RM4 bil. Known Polish mods include refueling probe, Targeting pod, AESA Radar.
- Spare parts, sustainment costs.
- ToT cost (need a full list of these)
- Half of payment through palm oil, maybe costs associated to this.
One thing that JF-17 and Tejas cannot compare to the FA-50. Advanced pilot training systems that is already proven and mature with the T-5/FA-50. If choose JF-17 or Tejas, RMAF will be on its own. Pilot training is a big part of LCA/FLIT requirements.
- embedded virtual simulation in the aircraft itself. You can have virtual enemy fighters, radars, missiles while you are flying the actual aircaft.
- Comprehensive ground-based simulator and computer learning systems
https://m.koreaaero.com/EN/images/business/TrainingSystem/img02.jpg
JF17 did not participate in the tender excercise, so his likely clients is JL10.
Mr retired Brigadier General complaints was that the 'winner' is always chosen beforehand which negated the reason for an actual tender.
He claimed that
1) MOF is currently in a direct nego with KAI exclusively.
2) RMAF didn't bothered spending time on physical inspection for the other 2 final contenders compared to KAI
3) MOF had written a letter asking for the other bidder to take back their deposit after the parliament has been dissolved.
Personally I don't think he's counting on MACC to find irregularities. His likely intentions is to bring this forward to the public court of opinion & his clients would put a diplomatic pressure to both SK & us in hope that the decision is overturned by the next administration.
At 900 million dollars for 18 FA-50, we are paying less than the poles who paid more than 3 billion dollars for 48 planes.
I don't believe we'll take a long break before a firm decision is made on the LCA/FLIT deal. If this Brig. Gen. is right, I'd assume that 'his' JF17s are coming in as single-seat and tandem-seat fighters. IF. Any new government will be a chacha-merba government but seeing the public interest and criticism levelled, there there's bound to be a backlash if the decision were to drag on. The public apathy on defence issues has somewhat dissipated replaced by mainly uneducated criticism from the public including some politicians on this issue.
dundun,
The poles are getting the 1st 12 as soon as next year, with 36 more starting 2024.
The poles are also getting an European MRO and spare parts center for FA-50. So if other european countries are going to buy FA-50 (Ireland, Slovakia, Bulgaria, Hungary to name a few), they will have to service their FA-50 in Poland.
KAI will also establish an international flight school in Poland as a part of the deal.