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Knives out for Malaysia's Najib

Asia Times - August 18, 2011

Anil Netto, Penang Just over a month after a large rally in Kuala Lumpur to demand clean and fair elections rattled Malaysia's ruling elite, Prime Minister Najib Razak has announced that a bipartisan parliamentary select committee will be set up to review the electoral system. The move comes as Najib's government faces rising pressures on several political fronts, including a speculated challenge to his leadership from inside his own party.

Najib's announcement has been interpreted as an attempt to placate disquiet about the integrity of the electoral process before the next general election, which must be held before mid-2013, and to prevent any repeat protest rally to press home the demands. The political opposition has claimed elections are structurally set up to favor the long-ruling United Malays National Organization (UMNO) and Barisan Nasional (BN) coalition.

On July 9, police authorities fired tear gas and water-cannon at protesters and arrested over 1,600 people, including opposition politicians. Protesters defied an official ban on the rally, which was organized by the civil society-led Coalition for Clean and Fair Elections, or Bersih. The group has called for cleaning up electoral rolls, the use of indelible ink to prevent repeat voting and longer campaign periods. Another key demand has called for a revamp of the postal balloting system to ensure Malaysians abroad and outside their constituencies can vote. Bersih has insisted that police and military personnel, who presently use controversial "postal ballots" cast outside of public view, must vote normally like other voters if they are not on duty on election day.

Since the July 9 crackdown, the state Election Commission has been put on the defensive as online news portals have highlighted the dubious registration of a string of voters, as well as allegations that foreigners have been illegally enlisted on ballot rolls. Despite mounting media and civil society pressure and Najib's apparent concession of the need for electoral reforms, it's still unclear if the two sides can reconcile.

Instead of introducing indelible ink as demanded by Bersih, Najib's government will provide allocations to fund the Election Commission's plan to introduce a biometric voter verification system. That proposal has been met with widespread skepticism over whether such a complicated system could be ready by the next election and if it could genuinely prevent manipulation and repeat voting.

Without iron-clad assurances of meaningful electoral reforms in time for the general elections, the proposal of a parliamentary select committee is "neither useful nor acceptable", says veteran opposition politician Lim Kit Siang. He stressed that Najib should "give a categorical assurance that there would be meaningful electoral reforms when the next general elections are held".

The tens of thousands who turned out at last month's Bersih rally despite a lock-down of the capital has put the Najib administration on the political defensive while giving new momentum to the Pakatan Rakyat (People's Alliance) opposition alliance. That's raising speculation about whether Najib could face an internal challenge by ambitious factions within UMNO.

Analysis has centered on the ambitions of his deputy, Muhyiddin Yassin, who also serves as education minister. Muhyiddin has been seen as falling out of line with Najib and Najib's predecessor, Abdullah Badawi, through contrary comments on key issues in recent years.

In March, for instance, Muhyiddin courted controversy when he claimed he was "Malay first" and only then "Malaysian", a seeming contradiction to Najib's "1Malaysia" policy that aims to bridge ethnic divides and promote a Malaysian identity.

Muhyiddin, who was first brought into the cabinet in the early 1980s by former strongman premier Mahathir Mohammad, is perceived in some circles to be allied with his former boss and his third son, Mukhriz Mahathir, who now serves as a deputy minister and is believed to have higher political ambitions.

Tumultuous dynamics

Those tumultuous internal dynamics are also likely being fueled by an investigation in France into the sale of Scorpene submarines to Malaysia under a deal entered into in 2002, when Mahathir was still premier. Acting on behalf of the Malaysian human-rights group Suaram, French lawyers lodged a complaint with Parisian investigators who are probing similar deals in France to establish whether kickbacks were paid to top French and foreign officials in connection with naval vessels sold by DCNS, a French naval defense company.

Attention in Malaysia has focused on an alleged payment of 114 million euro (US$167.8 million) to Perimekar Sdn Bhd in apparent connection with the submarine purchase. The firm is a subsidiary of KS Ombak Laut Sdn Bhd, of which the wife of former Najib aide Abdul Razak Baginda was reportedly a principal shareholder. Najib was defense minister at the time.

Although the case in France is confined to bribery investigations, many here believe it will shed light into the murder by bombing in Malaysia of a Mongolian woman, who is alleged to have been a translator for the deal. Underscoring the case's sensitivity, French lawyer William Bourdon was detained at Kuala Lumpur's international airport last month during a trip to brief Suaram on the progress of investigations and to raise funds for legal costs. He was promptly deported, but not before he vowed to relentlessly pursue the case.

Over the past month, more controversy erupted when it was revealed that the federal government had issued a call to government-linked companies to withdraw all civil suits against Tajudin Ramli, a once high-riding and well-connected corporate figure during the Mahathir era.

The government has reportedly decided to settle out of court all suits against the former Malaysia Airlines System Bhd chairman. The airline had lodged complaints against Tajudin in connection with huge losses incurred when he was at its helm in the 1990s.

"A settlement [out of court] would in effect... prevent the truth of who were actually responsible for the losses incurred from being revealed," noted the Edge business weekly. The rehabilitation of Tajudin may be seen as an attempt to close a chapter on an embarrassing sage under Mahathir's administration. At the same time, the lack of transparency and accountability in resolving the disputes out of court will not bode well for Najib's touted economic transformation plans.

The economy is slipping and weighing against UMNO's and the BN's popularity. Economic growth fell to its lowest level in two years in the first quarter, dipping to 3.6% from 4.6% last year. That decline could delay what many analysts believe is a much-needed hike in interest rates to cool inflation, which has risen sharply over the past two years. Taken together with government plans to remove some price subsidies, rumblings about the higher cost of living will be a key issue at the next polls.

At the same time, falling global crude palm oil (CPO) prices could dampen support for the BN in plantations that come under the state-managed land development scheme, traditionally seen as UMNO strongholds. The benchmark CPO price for October on the Bursa Malaysia Derivatives Exchange was 3,028 ringgit (US$1,014) per ton on Thursday morning, down nearly 25% from a February high of close to 4,000 ringgit.

With rising civil society pressure for reforms, new questions about top UMNO leaders' integrity and a sliding economy, Najib's two-year rule now arguably faces its biggest test. As those three-way pressures mount, the heat on Najib from within UMNO and a resurgent opposition will likely intensify and complicate his government's plans to hold general elections early next year.

[Anil Netto is a Penang-based writer.]

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