Malaysia PM si­lences crit­ics & media to sur­vive scan­dal


Malaysia’s prime min­is­ter has a prob­lem: He can’t ex­plain away a US$700 mil­lion bank ac­count to a skep­ti­cal public.

His re­sponse? A crack­down on crit­ics and the press that has kept him in power but doesn’t ad­dress a deep reser­voir of dis­sat­is­fac­tion with his lead­er­ship.

Less than a month af­ter leaked doc­u­ments sug­gested that US$700 mil­lion from en­ti­ties linked to debt- rid­den state in­vest­ment fund 1MDB was fun­neled into Prime Min­is­ter Na­jib Razak’s ac­counts, he has ex­pelled crit­ics in his gov­ern­ment, sacked the at­tor­ney-gen­eral prob­ing him, sus­pended two news­pa­pers, blocked a UK-based web­site and stalled in­ves­ti­ga­tions over the scan­dal.

It is the first time a Malaysian leader has faced crim­i­nal al­le­ga­tions, and news of pos­si­ble cor­rup­tion at the top level has gripped the coun­try. It is also the big­gest po­lit­i­cal cri­sis for Na­jib since he took power in 2009. Con­cerns over 1MDB also con­trib­uted to the Malaysian cur­rency plung­ing to a 17-year low be­yond 4 ring­git to the U.S. dol­lar on Wed­nes­day.

‘ Le­git­i­macy Cri­sis’

“Malaysia’s leader is still fac­ing a le­git­i­macy cri­sis with de­clin­ing do­mes­tic sup­port,” said Brid­get Welsh, se­nior re­search as­so­ciate at the Cen­ter for East Asia Demo­cratic Stud­ies at the Na­tional Tai­wan Univer­sity.

The mes­sage be­ing sent is that Na­jib’s lead­er­ship is mov­ing fur­ther to­ward a hard- line tra­jec­tory, she said. “History shows that crack­downs, ar­rests and threats back­fire, and are at best tem­po­rary mea­sures that fail to ad­dress the un­der­ly­ing de­mands for a bet­ter Malaysia.”

A na­tion of 30 mil­lion, Malaysia is pre­dom­i­nantly Malay Mus­lim with sig­nif­i­cant Chi­nese and In­dian mi­nori­ties. It is a U. S. ally in South­east Asia and one of the re­gion’s lynch­pin economies, with am­bi­tions to rise from mid­dle in­come sta­tus to de­vel­oped na­tion level this decade. Na­jib’s in­creas­ing au­thor­i­tar­i­an­ism is a set­back for the hopes of many Malaysians that their coun­try was slowly em­brac­ing el­e­ments of lib­eral democ­racy.

In a new twist last week, the an­ticor­rup­tion agency said the money was do­na­tions from the Mid­dle East, and un­re­lated to 1MDB. Na­jib, who in­sists he has never used gov­ern­ment funds for per­sonal gain, then said he re­ceived the money on be­half of his rul­ing Malay party, with much of it go­ing to­ward “so­cial re­spon­si­bil­ity” pro­grams.

While the ex­pla­na­tion has seem­ingly cleared Na­jib of cor­rup­tion claims, it didn’t mol­lify crit­ics nor im­prove his public im­age. On the con­trary, it raised new ques­tions over who in the Mid­dle East would do­nate such a huge sum and whether it came with con­di­tions. It also didn’t an­swer the mys­tery over why it landed in Na­jib’s ac­counts.

Elec­toral re­form group, Ber­sih, is plan­ning mass ral­lies at the end of Au­gust, on the week­end of Malaysia’s In­de­pen­dence Day, to de­mand Na­jib’s res­ig­na­tion but po­lice have warned of a crack­down. Na­jib has also in­di­cated he may crack the whip fur­ther, say­ing re­cently that laws reg­u­lat­ing In­ter­net con­tent need to be tight­ened to pre­vent “trial by the so­cial media” against the gov­ern­ment.

The scan­dal started with in­ves­ti­ga­tions into 1MDB, which was set up in 2009 by Na­jib to de­velop new in­dus­tries. But in just six years, it amassed 42 bil­lion ring­git ( US$ 10.6 bil­lion) in debt af­ter its energy ven­tures abroad fal­tered. Crit­ics have long voiced con­cern over its mas­sive debt and lack of trans­parency. Na­jib still chairs its ad­vi­sory board.

Po­lice, mean­while, have gone on a witch-hunt to de­ter­mine who leaked the doc­u­ments show­ing trans­fers to Na­jib’s ac­counts. Po­lice have ques­tioned nine mem­bers of the anti-cor­rup­tion agency, seven cen­tral bank of­fi­cials and have said they may also ques­tion cen­tral bank gover­nor Zeti Akhtar Aziz.

Foot­ing Strength­ened

De­spite the cri­sis, Na­jib has strength­ened his foot­ing in his United Malays Na­tional Or­ga­ni­za­tion, or UMNO, and taken full con­trol of the gov­ern­ment by plac­ing loy­al­ists in key po­si­tions. UMNO is the linch­pin of the Na­tional Front coali­tion that has ruled Malaysia since in­de­pen­dence from Bri­tain in 1957.

Sup­port for the Na­tional Front has eroded in the last two gen­eral elec­tions. In 2013, it won the polls but lost the pop­u­lar vote for the first time to the op­po­si­tion al­liance led by An­war Ibrahim, who is now in prison af­ter be­ing con­victed of sodom­iz­ing an aide in a case widely re­garded as po­lit­i­cally mo­ti­vated.

UMNO is en­trenched as the de­fender of ma­jor­ity eth­nic Malays, pro­tect­ing their rights through decades- old af­fir­ma­tive ac­tion poli­cies fa­vor­ing Malays in jobs, ed­u­ca­tion and gov­ern­ment con­tracts — and this is hard to dis­lodge, an­a­lysts said.

“This party has cap­tured the state in­sti­tu­tions and ma­chin­ery and that’s why they can con­trol ev­ery­thing,” said James Chin, who heads the Asia In­sti­tute in Aus­tralia’s Univer­sity of Tas­ma­nia.

“In Malay po­lit­i­cal cul­ture, a strong leader is feared and ad­mired, and that’s how Na­jib is selling him­self, as a strong­man,” Chin said.

The 62-year-old Na­jib, whose fa­ther and un­cle were the coun­try’s sec­ond and third prime min­is­ters re­spec­tively, was ed­u­cated in the UK. He re­turned to work for the cen­tral bank and the na­tional oil com­pany but was un­ex­pect­edly thrust into pol­i­tics when his fa­ther, then-Prime Min­is­ter Ab­dul Razak Hus­sein, died in 1976.

At age 22, he was Malaysia’s youngest law­maker ever at the time and pa­tiently worked his way to the top. He speaks im­pec­ca­ble English and seen as mod­ern: he has his own blog and is an avid so­cial media user.

Since be­com­ing premier, Na­jib has bat­tled crit­i­cism over his man­age­ment of the econ­omy, his fam­ily’s lav­ish lifestyle and as­so­ci­a­tion with the killers of a Mon­go­lian model nine years ago. Na­jib has said he had noth­ing to do with the model. Two se­cu­rity of­fi­cers linked to Na­jib at the time were found guilty of her mur­der.

One of his most vo­cal crit­ics is for­mer Prime Min­is­ter Ma­hathir Mo­hamad, who stepped down in 2003 af­ter 22 years in power. Ma­hathir has called for Na­jib to re­sign over the 1MDB af­fair, warn­ing there was “some­thing rot­ten” in the gov­ern­ment.

Na­jib’s own brother, Nazir Razak, who heads Malaysia’s sec­ond largest bank­ing group CIMB, has also echoed con­cerns over the coun­try’s fu­ture. In an In­sta­gram post last month, Nazir said “in this dark­est hour of po­lit­i­cal times, we must re­mem­ber to place the coun­try and the ( peo­ple) first. Not per­sonal in­ter­ests, not per­sonal loy­al­ties, not even party pol­i­tics.”

Ibrahim Suf­fian, who heads the Merdeka Cen­ter for Opin­ion Re­search, said UMNO and other Na­tional Front par­ties have ral­lied be­hind Na­jib be­cause they fear the 1MDB cri­sis could sink the gov­ern­ment.

The con­tro­versy over 1MDB came at a time of eco­nomic slow­down as fall­ing com­mod­ity prices hurt Malaysia’s ex­port-driven econ­omy and gov­ern­ment rev­enue. The public is also grap­pling with higher cost of liv­ing due to a new goods and ser­vices tax im­posed in April.

Chin from the Univer­sity of Tas­ma­nia said Na­jib is more fo­cused on con­sol­i­dat­ing power, than fix­ing the econ­omy.

“Na­jib has the up­per hand now but if the econ­omy sours fur­ther, it could spell trou­ble for him.”

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