Profitless, uncompetitive subsidiaries to be shut down - Melaka Chief Minister

MELAKA - The Melaka state government subsidiaries that are not generating profits or showing progress will be shut down to reduce financial burden or prevent future financial implications.

Melaka Chief Minister Datuk Seri Ab Rauf Yusoh said concerning this, a holistic assessment in terms of the potential and progress of all 67 subsidiaries is being conducted, adding that operations will cease if it is determined that they cannot be independent and lack a sustainable business plan.

He said the criteria being evaluated include the ability of the subsidiaries to pay salaries and conduct their business without having to rely on financial boost from the state government, among other things.

"We have identified the uncompetitive subsidiaries and will give them the opportunity to present their business plans.

"We are bound by existing enactments, so we cannot continue to sustain the subsidiaries that are incurring losses. We have no choice but to shut down their operations,” he told reporters after officiating the Financial Performance and Top Management Governance Enhancement Worksop for State Government Subsidiaries, here, today.

He spent over an hour discussing with the heads and representatives of the subsidiaries in addition to listening to presentations on their performance, direction and corporate governance.

Ab Rauf said employees of the relevant subsidiaries will be transferred to subsidiaries that are more competitive and capable of generating income and profits.

Meanwhile, he urged all subsidiaries to seize the investment opportunities brought in by the state government in various sectors to improve their income.

"Through the investment policy that we have outlined, we expect a lot of investments to pour into Melaka in the future. This is the best opportunity for these subsidiaries to contribute to the development of the state,” he added. - BERNAMA