Financial scandals and foreign affairs
If Malaysia’s political impasse breaks, the impact may be global.
Amrita Malhi, New Mandala
“I myself have never wanted foreign interference in our domestic affairs,” former Prime Minister Mahathir Mohamad declared in late June in his Putrajaya office. “But domestic means of redress have been closed.”
Since I spoke to him then there’s been much debate between Malaysia analysts on whether current PM Najib Razak’s position is safe, and how much longer he can hold on before the cluster of problems now assembled around him ends his political career. Today, the ANU Coral Bell School of Asia Pacific Affairs hosts the 2016 Malaysia Update largely focused on this debate.
This is an important question, not only for Malaysia but for Australia. Analysts in Asia continue to argue that Najib is unassailable, based on their analysis of formal UMNO structures and the Malaysian bureaucracy. Mahathir largely concurs in his assessment of Najib’s domestic prospects, saying “the AG [Attorney-General] will not take up the case against him in the court.
“The AG simply brushes aside all reports, just like 1MDB,” the state development fund that the United States Department of Justice (DoJ) is now investigating under its Kleptocracy Asset Recovery Initiative. “So he will never be proven guilty because the courts are under his control,” Mahathir adds.
Nevertheless, DoJ documents have named Najib’s step-son Riza Aziz, financier Low Taek Jho (or Jho Low), his associate Eric Tan, along with two government officials in Abu Dhabi. The DoJ believes that USD $3.5 billion was siphoned out of the fund, of which it claims that $1 billion was laundered through the purchase of US-based assets or “dissipated” through lavish lifestyle expenses.
The DoJ announcement makes clear that the international reach of the Najib saga—now creating many problems for Malaysia’s trading partners—makes external jurisdictions the key arena in which Najib’s opponents are now moving to depose him. Yet precisely because the networks, relationships and Machiavellian stand-offs now operating around Najib are too numerous and diffuse, there remains no telling how long he will last, or, importantly, what change will follow if sufficient forces combine to push him.
