International Trade and Industry (Miti) Minister Mustapa Mohamed said much of the loan will be for the national car manufacturer to make payments to Proton vendors.
As part of the conditions for the soft loan, Proton is required to turn around the business, he said.
“Proton needs to convince the government about its new business model so that the business is viable and competitive,” he said in a media statement today.
In particular, Mustapa said Proton would need to create a restructuring model and have a strategic plan for the expansion of the market, locally and abroad.
In addition, Proton will also need to get a foreign partner to assist in research and development (R&D) and to make the company viable and competitive at the international level, he said.
Mustapa said a task force, headed by Performance Management and Delivery Unit (Pemandu) Chief Executive Officer Idris Jala will be set up to carry out the transformation programme.
“This team will have three representatives, from both the private sector and public sector.
“The government representatives will stand in for the Ministry of Finance, Miti and Economic Planning Unit.
“The private sector representatives will be identified as soon as possible.”
Mustapa said apart from ensuring the terms of the soft loan were complied with, the task force was also required to check on the business model of Proton in the past, identify weaknesses and ways to overcome them.
He said the automotive industry was a strategic industry and Proton had 12,000 employees with the parent company and 50,000 people employed by Proton’s vendors.
“The Cabinet decision today is also to take into account the welfare of 60,000 workers who depend directly on the future of Proton.”
– BERNAMA