RECENTLY, International Trade and Industry Minister Mustapa Mohamed told Parliament a week back that a new RM628mil exhibition complex, with a floor space of 90,000 sq m, would be built at the Malaysian External Trade Corporation (Matrade) centre in KL.

While this will double the exhibition space in the Klang Valley and allow Malaysia to compete with other Asian countries for bigger international shows and conventions, sceptics fear it will just be a 'white elephant' when completed.

Furthermore, it is also likely to spark a controversy because the development contract  has been given to Naza TTDI, allegedly without an open tender.

Mustapa has painted a grand picture of the spanking new centre that would be built in the prime Mont Kiara-Jalan Duta area and when asked by reporters if the government will help the company in raising funds for the development, he had reportedly said: "We are not Port Klang Free Zone."

Not everyone is convinced.

PAS Youth chief Nasruddin Hassan At-Tantawi said the company is liable to make millions in profit at the expense of the government and ratepayers.

Among the major exhibition centres currently being used in Malaysia are the KL Convention Centre (9,710 sq m), Putra World Trade Centre (23,504 sq m), the current Matrade centre (13,000 sq m) and the Malaysia Agro Exposition Park, Serdang (10,000 sq m).

Small compared to other Asian countries

Mustapa said the floor space of such centres is small compared to regional players in the exhibition industry, adding that the proposal by Naza TTDI was too good to turn down.

Explaining the deal, Mustapa said Naza TTDI had proposed to build the centre for Matrade in March 2007.

The proposal was accepted by the Cabinet in December of that year, he said, adding that when the deal was proposed, the land area to be exchanged with Naza TTDI was valued at RM197mil.

The minister said with the new centre more efforts will be made to market Malaysia as a trade exhibition destination. It is scheduled to be completed in 2013.

Nasrudin said exisiting centres, including the Putrajaya International Convention Centre (PICC) and the Lankgawi Trade and Exhibition Centre, were all under-used.

"I understand that these centres had failed to meet the objectives for which they were built and the government has to bear much losses in maintaining them," he said in his blog.

Citing the PICC as an example, he said the RM600mil centre that was completed in 2003 os a burden to the government because it was reaping only about RM2.5mil in revenue against a much bigger amount to maintain it.

Something hidden from the public?

He alleged that the central government did not give even a sen to Naza TTDI to build the RM628mil expo centre,  where the deal was for it to only grant a premium land of 65.5 acres. (which is said to be worth RM72 per sq ft; giving a total value of RM197mil).

"It would seem like the Naza TTDI had 'presented' to the Government some RM341mil," Nasruddin alleged.

He further asked: "Which company would want to lose that much of money if it does not expect a bigger return? Is there something that is being hidden from public knowledge?

"Could it be true that the government would gain RM341mil after the centre is built? Is it true that Naza TTDI only got the land at RM197mil (at RM72 per sq ft)?"

Petaling Jaya Utara MP Tony Phua had claimed that the land concerned is under-valued if the worth is assessed at just RM72 per sq ft.

He said the actual assessment is RM350 per sq ft and the whole worth of the project is RM970mil for 62.5 acres.

Nasruddin added: "If these assessments are true, it would mean that the government has given Naza TTDI RM970mil and not RM628mil, as claimed and this would also give Naza TTDI a profit of RM342mil."

He said in the current economic climate the country does not need an extravagant exhibition centre and there is also no reason to be generous to Naza TTDI for the development. - Malaysian Mirror