Malaysians underestimate the damage caused by the 1MDB scandal
FORTY thousand people wearing yellow shirts gathered in Malaysia’s capital on November 19th, to protest against corruption and impunity in government. The rally was orderly and restrained; the response of the authorities was not. On the eve of the protest, police arrested Maria Chin Abdullah, leader of a coalition of human-rights groups that organised the event. She was placed in solitary confinement, and can be held there for 28 days. Even by Malaysia’s dismal recent standards this marked a fresh low. Ordinary Malaysians should not stand by while their leaders undermine the rule of law so casually.
Ms Chin Abdullah’s detention was justified by an anti-terrorism law which the government had promised would never be used against political opponents. The true motivation was to stifle outrage over 1MDB, a state-owned investment firm from which billions have gone missing. In July American government investigators said they thought that $3.5bn had been taken from the firm and that hundreds of millions of dollars went to the prime minister, Najib Razak (who says he has never taken public funds for personal gain). The investigators’ findings corroborated exposés written by local and foreign journalists, who have been unravelling the saga for several years.
Elsewhere the scandal would have sparked a swift change in government. But the United Malays National Organisation (UMNO) has held power for six decades and enjoys broad support from Malaysia’s ethnic-Malay majority, some of whom resent their ethnic-Chinese and Indian compatriots. The party has devised many ways to protect its leaders from internal revolts, so Mr Najib found it easy to purge critics, delay a parliamentary investigation and replace an attorney-general said to have been preparing charges against him.
No one in Malaysia has been charged over 1MDB’s missing money. But a court has handed a prison sentence to an opposition politician who frustrated efforts to hush up the affair. The editor and publisher of one of Malaysia’s last independent news organisations face jail under a rule which forbids certain content published with “intent to annoy”. A competitor closed in March after authorities ordered its website blocked.
Mr Najib’s party is carelessly widening Malaysia’s ethnic and religious splits. Seeking to bolster support among conservative Malay Muslims, it is toying with a proposal to intensify the whippings which may be meted out by sharia courts. It has failed properly to condemn pro-government gangs that last year menacingly gathered in a Chinese part of the capital. Their leaders paint ethnic Malays as victims of sinister conspiracies—dangerous rumour-mongering in a country where politics is still defined by the racial violence of the 1960s.
Easily broken, hard to fix
Until now foreign investors have been fairly sanguine about the economy. But they are growing rattled. The ringgit has depreciated faster than other emerging-market currencies (see article). Last week the authorities asked foreign banks to stop some ringgit trading abroad, raising fears of harsher controls.
Rural ethnic Malays, a crucial constituency, feel that the scandal is a remote affair. Even some educated urbanites still favour Mr Najib’s government over the opposition, underestimating the damage being done by the scandal. If change is to come, the disparate opposition needs to do a better job of winning such people over; its fractious parties must overcome their divisions and present a plausible candidate to replace Mr Najib in a general election that could be held as soon as next year. Malaysia has always been an imperfect democracy, but the rot eating at its institutions is harming its international standing and its economic prospects alike.