GEORGE TOWN, Nov. 7 -- The Penang state government will form a special purpose vehicle (SPV) to issue bonds for funds to pay for the state's massive transportation plans, Penang Chief Minister Chow Kon Yeow (DAP - Padang Kota) said today.

He said the prime minister has written to confirm that the federal government will provide a sovereign guarantee for bonds issued through the state's SPV to raise money for the RM46 billion Penang Transport Master Plan (PTMP).

"With a guarantee from the federal government, we have started discussions with banks on the issuance of bonds to fund the project," he said in reply to a question by Ong Khan Lee (PKR - Kebun Bunga) at the state legislative assembly today.

He added that Penang would not have be...