The New Nation - Internet Edition

AFP, Kuala Lumpur

Malaysia's debt-ridden port authority has been rescued by the government, with the transport ministry saying on Friday that they would give them a soft loan to cover about one billion dollars of debt

Port Klang, whose officials may be investigated for corruption, has spent 4.6 billion ringgit (1.3 billion dollars) since construction began in 2004, and local press have reported that the authority is riddled with mismanagement

After meetings between the transport minister and Prime Minister Abdullah Ahmad Badawi yesterday, the government agreed to the loan for the Port Klang Free Zone (PKFZ), a transport ministry spokesman said.

"Port Klang is our main port and we have much big plans for it We cannot continue to let debt problems persist as it holds back all the plans to enhance this venture," the spokesman told AFP.

The 1,000-acre (400-hectare) PKFZ shipping area opened in western Malaysia last year, and costs have risen swiftly.

"With the high overall cost of the PKFZ in mind, the government has agreed to give the soft loan and details are being worked out on the repayment scheme. It will be a scheme that will help them to get back on their feet again."

The decision is likely to worry opposition leaders and corruption watchdogs, who have urged the government not to bail the port authority out without a thorough investigation into any corruption.

The government's powerful Public Accounts Commitee said Wednesday they would look into any financial mismanagement by the port, and possibly launch a full-scale investigation.