KUALA LUMPUR: Malaysia has urged Norway to help expedite a refund of more than RM1 billion (US$251.5 million) for a scrapped missile procurement deal, insisting that Oslo cannot absolve itself of responsibility.
Malaysia Defence Minister Mohamed Khaled Nordin said on Tuesday (Jun 2) that he had recently met his Norway counterpart Tore O Sandvik and conveyed that the root cause of the issue was Norway’s decision to revoke the export license.
“The source of everything is Norway’s decision not to approve the export licence to Malaysia,” Khaled was quoted as saying at the sidelines of an event at Kota Tinggi Bus and Taxi Terminal.
“Therefore, Norway cannot wash its hands of this matter because its decision caused the problem,” he added.
Khaled said that he had told Sandvik that if Norway was sincere about maintaining bilateral relations with Malaysia, it should help facilitate the refund process, reported Malaysian news outlet The Star.
“But if Norway truly wants to maintain its friendship with Malaysia, it can help by prioritising the return of more than RM1 billion,” he said.
Khaled suggested that the Norwegian government should consider advancing repayment before seeking reimbursement from the Norwegian defence firm Kongsberg Defence & Aerospace (KDA), which Malaysia had contracted for the missiles.
“The company that cannot fulfil the contract is a Norwegian company. As a government, Norway can negotiate with the company rather than force Malaysia to wait indefinitely,” he added.
On May 14, Norway refused to approve an export license under a 2018 contract for a Naval Strike Missile system that Malaysia bought for its six littoral combat ships (LCS), with Oslo saying its defence technology exports would be limited to its “allies and closest partners”.
Days later, Malaysia said on May 19 it was seeking more than RM1 billion in damages from KDA, which it had paid 95 per cent of the defence contract value to before Norway unilaterally revoked the export licenses.
Malaysia had sent a notice demanding compensation for both “direct and indirect costs” from the defence firm, Khaled added.
After the Kota Tinggi event on Tuesday, Khaled said that the compensation funds were needed to secure an alternate missile system for its national navy, noting that Malaysia was evaluating missile systems from countries such as Italy, Japan, France, Turkey and South Korea.
He also said that Malaysia was prioritising securing missiles that were already in production as placing fresh orders could lead to delays to up to five years, reported local media.
“We cannot place a new order because we would have to wait a long time. That is not an option. We want what is already in production,” he said, adding that pricing and integration compatibility were also being evaluated.
“Perhaps the US (United States) is making some for its own ships, Italy too. If there are available units, I want to request those first,” he said.