Army gets 257 APCs. Quite funny listening in to BFM's morning talk yesterday. The host and guests were happily bitching about the news about Tan Sri Syed Mokthar's DRB Hicom Bhd being awarded a RM7.55 billion contract to supply armoured personnel carriers to our Army by 2016. (Read the story here). The chatter went, more or less, like this:
"That's RM200 million for each vehicle!"
"That is too expensive!"
"We are not at war, why are we spending so much?!"
"How come we don't hear the government spending this kind of money on education?!"
And then one of the dudes realized they'd made a grave mistake. He must have brought out his calculator and divided RM7.5 billion by 257 (the number of vehicles under the contract), which gave him RM30 million a vehicle. Not RM200 million.
Awkward seconds later ...
"Oh, we stand corrected". ".... it's RM30 million not RM200 million". "RM30 million?!" "Wow! That is still so much money!!"
Blah blah blah.
My point is, some people will oppose something even if it's good or even if their basis for opposing it is wrong, simply because their minds have been made up for them.
But for DRB shareholders, who barely a year ago had decried the company for not making their shares sexy to shareholders, the contract is a boon. The stock has appreciated by more than 80 per cent. The contract will have a minimum of 20% local content, with Malaysia having the rights to sell and market the APCs as their own in the international market. It will create about 500 jobs in Pekan, Pahang and provide indirect employment for thousands of others. DRB will be forking out up front as much as RM3 billion to ensure the contract runs smoothly.
Like all defence projects, the contract is bound to raise the ire of arm-chair critics like myself, and others. The betting man would not want to wager against Syed Mokhtar against delivering his end of the bargain, though, considering his track record. Remember Tanjung Pelepas? Against heavy odds, the tycoon staked almost his entire fortune to build Malaysia's largest container port which today counts Maersk Sealand, the world's largest container ship operator, as one of its clients.
p.s. I'll be listening in to 89.9 again this morning; it is after all my favorite radio station. But for the son of the guns who are jumping the gun and saying that Malaysia is spending too much on defence, please remember Singapore is in the Top Ten list of arms dealers in the world.