Malaysian PM Najib Takes on his Critics

Under severe fire from factions within his United Malays National Organization and from outside by the opposition Pakatan Rakyat, Malaysian Prime Minister has gone on the offensive to seek to keep his job, marshaling his forces within UMNO to stand off his critics.

Over the weekend, the prime minister called together 160 of the 191 UMNO division chiefs to a party powwow in Kuala Lumpur that resulted in a unanimous confidence vote from those who showed up to listen to an explanation of his handling of the controversial 1Malaysia Development Fund. Unfunded liabilities and opaque reporting of the fund’s finances have earned blistering criticism from former Prime Minister Mahathir Mohamad. The former premier has declared that “something is rotten in Malaysia,” and called for Najib’s ouster as UMNO President and prime minister.

Opposition politicians, mostly led by MP Tony Pua of the Democratic Action Party and Rafizi Ramli, the secretary general of the Parti Keadilan Rakyat, have been at the forefront of the rtitics.

In the face of unprecedented pressure from his critics, last week Najib wrung a similar vote of confidence from the 37-member Cabinet – with one conspicuous exception, that of Muhyiddin Yassin, the deputy prime minister and deputy party leader, who was absent, spurring speculation that Muhyiddin intends to take on Najib for his job. His absence was minimized by party wheelhorses, saying the absence meant nothing and that Muhyiddin had prior commitments. However, behind the scenes, sources say Muhyiddin is increasingly on the hunt for Najib’s head. As early as last autumn, prior to the UMNO general assembly, the deputy prime minister, 67, was complaining publicly that the party could lose the next election, due in 2018, without serious change.

Last week, Muhyiddin came out with his own statement on the deeply indebted 1MDB, saying the government would not be allowed to bail out the fund, which has liabilities of more than RM40 billion, and demanding an immediate forensic audit to explain the fund’s tangled business dealings. However, according to people in UMNO, Muhyiddin is hardly a reformer and is likely to emphasize Malay nationalism. His own financial dealings are also tangled, with widespread rumors that he has used his public position as a path to personal wealth.

The fund’s activities have been the subject of sensational investigative reporting by The Sarawak Report, a blog edited by Clare Rewcastle Brown, who uncovered hundreds of company emails indicating that Taek Jho Low, a Penang-born financier, had virtually run the operations and that company officials themselves had little idea of hundreds of millions of dollars of investments he was making. Last week, for instance, Brown reported that Jho Low, as he is universally known, had used Najib's name to circumvent Bank Negara approval needed on a US$1 billion loan (RM3.69 billion) provided to 1MDB.

It is unclear, however, whether either the cabinet or the party division chiefs examined any of the information published either by the Sarawak Report or The Edge, a Kuala Lumpur-based newspaper that has reported aggressively on the fund’s scandals as well, or a massive New York Times article published on Feb. 6 detailing tens of millions of dollars in property purchases by Jho Low that were actually made for members of Najib’s family. News reports indicated that the cadres mainly listened to Najib’s explanation as well as that of Deloitte, the fund’s auditors.

“With his explanation, we are confident of explaining the 1MDB issue to the public and the grassroots,” Ismail Sabri Yaakob, the agriculture minister, told a press conference. As to the reports of the family’s extraordinary wealth, another party figure, Bung Mokhtar Radin, told reporters there was no issue, that Najib’s siblings are all in business and are wealthy, an explanation that has been met with sarcasm. Najib’s brothers have issued indirect criticisms of the prime minister for statements that his wealth was part of a family legacy, a statement he later retracted.

Monday, the Inspector-General of Police, Khalid Abu Bakar, announced that Najib himself would be a target of a three-agency task force that included members of the police, the Malaysian Anti-Corruption Commission and the Attorney General’s chambers to look into the fund’s dealings. That has been laughed off by cynics, who point out that all three agencies have been deeply politicized and have covered up more offenses than they have investigated. The intent behind the announcement of the probe, they say, is to provide the prime minister a clean bill of health. Najib has also ordered the country’s auditor-general to vet 1MDB's accounts.

The critics, however, have called for the cabinet to disqualify themselves from any role in probing the fund since a statement by Najib that everything is fine is hardly a serious attempt to clear up any questions. In addition to setting up the fund in the first place, Najib also functions as the chairman of the 1MDB advisory committee.