Giant video screens lining Malaysia’s ruling-party headquarters flash towering, 40-story images of a smiling Malaysian Prime Minister Najib Razak across a corner of the capital, a glaring reminder of who is in charge.
One year after a financial scandal that would have toppled many leaders, Najib is standing taller than ever after smothering investigations, outmaneuvering opponents, and bolstering his control with a pair of election wins.
However, the political survival steps he has taken — which include assuming tough new powers and flirting with a conservative Muslim political party — are stoking fears for multi-ethnic Malaysia’s already fragile democracy and sectarian relations.
“He called himself a reformist, but has changed into an aspiring dictator,” prominent lawyer and reform advocate Ambiga Sreenevasan said. “What changed him, clearly, is 1MDB [1Malaysia Development Berhad].”
On July 2 last year, the Wall Street Journal reported that Najib received a mysterious US$681 million payment, which capped months of allegations that billions were diverted from 1MDB, an investment fund Najib founded.
Other revelations followed, including reports that Najib’s film-producer stepson used 1MDB-related funds to bankroll the Hollywood greedfest The Wolf of Wall Street, and for millions in luxury purchases.
Swiss authorities said more than US$4 billion might have been stolen. Najib and 1MDB deny wrongdoing.
However, Najib has purged ruling-party critics, curbed investigations and cracked down on media reporting of the affair.
With former opposition leader Anwar Ibrahim jailed since February last year on politically tinged sodomy charges, Najib now towers over the country.
“Najib’s critics failed to comprehend his resolve at staying in power and the lengths he is prepared to go to,” said Ibrahim Suffian, head of Merdeka Center, an independent polling firm.
The government recently pushed through a new law allowing a Najib-led council to suspend basic liberties if security is deemed threatened, which the opposition called a “lurch toward dictatorship.”
Other proposals would tighten Internet controls and limit other legal protections.
“Any remnants of checks and balances are being dismantled by the PM [prime minister]” due to 1MDB, said Eric Paulsen, head of the legal-advocacy group Lawyers for Liberty.
However, Najib’s electoral fortunes have never looked better as general elections loom by the middle of 2018, aided by disarray in the once-formidable opposition following Anwar’s jailing.
Najib’s United Malays National Organisation (UMNO) has governed since the country gained independence in 1957 on a platform of rapid economic growth and special rights for Muslim ethnic Malays, Malaysia’s majority group.
Aided by its deep pockets and loyal Malay support, UMNO’s Barisan Nasional (National Front) ruling coalition notched landslide wins in a state election last month and parliamentary by-elections this month that exposed the limits of 1MDB outrage.
“Najib’s standing among Malaysians has gradually improved over the past six months as voter anger over 1MDB and [an unpopular consumption tax] dissipate,” Suffian said, adding that bread-and-butter economic issues matter more.
Najib denies abusing power and recently dismissed the graft allegations as “unprecedented politically motivated slander” by 90-year-old former Malaysian premier Mahathir Mohamad, who has led calls for Najib’s removal.
Najib’s office did not respond to a request for comment.
However, Barisan Nasional strategic communications director Abdul Rahman Dahlan dismissed the allegations of 1MDB-spurred repression as “absolute rubbish.”
“The opposition’s problem is they are unable to convince voters they are a viable alternative,” he told reporters. “When [voters] go to the polls, it is not just about 1MDB.”
In the scandal’s wake, UMNO also has intensified a dalliance with the country’s conservative Muslim party, refusing to denounce its proposal for harsh Shariah law in a northern state.
The Shariah bid has scant hope of succeeding, and analysts said UMNO is merely playing politics to solidify Muslim support and distract from 1MDB.
However, the conservative Muslim tilt has unsettled many who view Malaysia’s treasured religious moderation as under threat.
“I’m very worried,” said Bob Broadfoot, head of Hong Kong-based Political and Economic Risk Consultancy. “[Najib] is changing UMNO in ways that I fear could make it more Islamic and weaken the government’s support among non-Malays. This is going to strain racial relations much more.”
Fringe Muslim elements disgusted by 1MDB might also abandon political parties and turn to extremism, he said.
A half-dozen countries including the US have launched 1MDB-related probes, but few believe big fish will be caught, citing the carefully constructed complexity of 1MDB fund flows.
Najib “will get away with it,” Broadfoot said.
However, he said the allegations of fraud and embezzlement involving state-linked entities might make foreign investors think twice, at a time when Malaysia needs investment to buffer global economic headwinds.
“That’s going to cost Malaysia,” Broadfoot said.
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