IPOH, April 24 — About 200 vendors and contractors have shut down following the delay in the delivery of the second littoral combat ship (LCS) two years ago, according to Pangkor assemblyman, Datuk Seri Dr Zambry Abdul Kadir.
He said the project which involved 400 vendors and since the postponement was announced, almost 50 per cent of the total vendors were affected and the issue would affect all if there was no decision made by the government or the parties concerned.
“It is a project at national level which is not involving one group. Employment opportunities, local economy and national security are all involved in the project.
“Measures by the government are crucial for the LCS project to proceed so that vendors and workers can continue their work and will not get retrenched,” he told a press conference which was also attended by several vendors of the project.
Zambry said the failure in the construction of the LCS in Lumut is not only creating a controversy but the government should intervene and gave it serious attention as it is affecting many parties and local economic players.
One of the vendors, Safie Tamrin said his company and other vendor colleagues are facing debts apart from revolving capital which is not giving returns due to the project delay.
“We are appealing to the government to restart the LCS project to save all parties,” he said.
It was reported in December that the Ministry of Defence had conducted an in depth investigation on the failure of the subsidiary of Boustead Holdings Bhd which is Boustead Naval Shipyard Sdn Bhd (BNS), to supply six LCS valued at RM9 billion for the Royal Malaysian Navy.
Senior Defence Minister Datuk Seri Ismail Sabri Yaakob said the ministry had also conducted an investigation by reviewing the contract clauses on late delivery in the acquisition of LCS.
According to him, findings of the investigation led to the issuance of the notice of Liquidated and Ascertained Damages (LAD) amounting to RM180 million in which RM80.6 million had been collected one-off from BNS in October.
According to the original plan, two of six LCS should have been delivered but as at July 31 (2020), none had been completed.