KUALA LUMPUR -- The Malaysian government has seized roughly 1 billion ringgit ($243 million) in assets held by a state-backed Chinese company, citing a botched public works project for which the corporation was paid under the previous administration.
The money was taken from a unit of China National Petroleum Corp. that had been selected for an oil and gas pipeline project planned for the island of Borneo and the Malay Peninsula.
The action is part of efforts by Prime Minister Mahathir Mohamad to recoup funds lost to corruption and lax management under predecessor Najib Razak.
The Malaysian government paid 8.3 billion ringgit of the 9.4 billion ringgit in total costs to China Petroleum Pipeline Engineering. But the Mahathir government scrapped the project in 2018, the year it came to power, after construction was found to be only 13% complete.
"So the government is entitled to get back the money, since the project was canceled," Mahathir said Monday.
Mahathir had vowed to renegotiate or cancel what he calls "unfair" Chinese projects authorized by Najib. The government decided in April to cut construction costs for a railway project with China on the east coast by 21.5 billion ringgit from the original plan.
The government is also trying to recoup money stolen from the scandal-plagued 1Malaysia Development Berhad state fund. It sold off a luxury yacht and other assets that it seized. More than $4.5 billion was allegedly misappropriated through the fraud.