Well that was an unexpected move.

According to the New Straits Times, 1MDB chairman and Treasury Secretary-General Tan Sri Dr Mohd Irwan Serigar Abdullah announced that the government-linked company will be shut down once it pays off all its debts.

Need money to make money

Irwan outlined the ways in which the government will raise the necessary revenue to pay off 1MDB's debts:

• The development of the Tun Razak Exchange, which will be the tallest building in Malaysia once completed.
• The East Coast Rail Link.
• Second Mass Rapid Transit Project.

Now these are all infrastructure projects that cost money, but as he explained:

"Soon, residents who own a place in the TRX city will pay rent, and we will also sell land plots of Bandar Malaysia which will be developed with public transport such as high-speed train, ECRL and MRT.

Through this, we will pay the debts... Rome wasn't built in a day, we will not get the revenue immediately, instead it will take more than 10 years to generate income from the long-term development. Once the debts are paid, there will be no need for 1MDB."

Irwan was speaking in a press conference following an Economic Challenge Order event with the students of Universiti Malaysia Kelantan.

[related_story]

O$P$

1MDB has already started paying back its debts.

In December 2017, the International Petroleum Investment Co (IPIC), owned by Abu Dhabi in the United Arab Emirates, reported that 1MDB had paid back the US$1.2 billion that was owed under the Settlement agreed upon in May 2017.

According to this Straits Times report in April 2017, the money in the Malaysia/ Abu Dhabi tussle is of special interest to legal suits brought about by the US Department of Justice, which alleges misappropriation of about US$4.5 billion from 1MDB.

But the company has denied any wrongdoing and Malaysian Prime Minister Najib Razak, who founded 1MDB, has denied all allegations of corruption against him.

With a general election looming, perhaps Najib wants to put the whole 1MDB saga to bed and out of the minds of voters.

It remains to be seen if this unusual move will have any impact on the upcoming election.

Related stories:

Top image by Chris Jung/NurPhoto via Getty Images