KUALA LUMPUR (AFP) – Malaysia’s premier is under mounting scrutiny for cracking down on opponents, troubles in a strategic development fund and questions over his family assets, with even ruling-party conservatives questioning his leadership.
Prime Minister Najib Razak, 61, took the helm of the multi-ethnic country’s long-ruling regime in 2009, promising to soothe racial tensions and bolster democracy.
But he is under fire from progressives for abandoning such pledges and from ruling-party hardliners over 1MDB – a development vehicle he launched that is believed to be in a precarious state.
“People are beginning to doubt whether he is the sort of leader who can address Malaysia’s problems,” said Wan Saiful Wan Jan, head of Malaysian think-tank IDEAS.
Malaysia also drew international criticism after opposition leader Anwar Ibrahim was jailed for five years last week on a sodomy conviction widely considered politically motivated, the latest in a crackdown on Najib’s opponents.
1MDB, meanwhile, has missed repeated deadlines to pay down billions of dollars in debts, according to Malaysian media reports, with questions swirling around the whereabouts of huge sums.
1MDB said a $560 million loan payment was finally made last week, after a Malaysian billionaire was reportedly drafted in to stump up the cash.
Also last week, a New York Times investigative report detailed multi-million-dollar purchases of luxury US real estate by a close Najib family associate, financier Low Taek Jho, whom various reports have linked to 1MDB.
It also said documents showed millions of dollars in jewellery purchases for Rosmah Mansor, Najib’s wife, who is widely ridiculed in Malaysia for her luxurious tastes.
In a statement to AFP, Najib’s office said the report raised “false allegations”.
“The prime minister does not have, nor has he ever had, a financial interest in, or any sort of agreement related to, the properties mentioned in the article,” it said.
It added that “no purchases by the prime minister or his family involved funds from 1MDB”.
In a separate statement, 1MDB denied ever missing any debt payments and said it has no links with Low.
But Malaysia’s opposition and other government critics, who allege decades of widespread government graft, have called for Najib to detail the sources of his wealth and for an independent audit of 1MDB.
The government is yet to respond to such calls.
Fears that the fund could collapse and rattle Malaysia’s financial system have exacerbated economic unease in the energy-exporting country.
Sagging oil prices have dragged the ringgit currency to six-year lows and are expected to crimp economic growth this year while the government struggles to contain a troubling deficit.
Most experts expect the economy to avoid serious harm.
Leading criticisms of 1MDB is Mahathir Mohamad, who was premier from 1981-2003 and still casts a long shadow at 89.
That is potentially worrisome for Najib – Mahathir engineered the ouster of his own chosen successor, installing Najib. Mahathir wrote on his widely read blog last week that “there is something rotten” in Malaysia, and on Thursday suggested Najib should resign.
“The country is currently facing a lot of problems but the government is not admitting it. They are in denial,” he said.
Political observers say such pressure is part of a battle for influence and spoils in the ruling United Malays National Organisation (UMNO), pitting Najib against forces seeking to take the country even further to the right.
“The danger for Najib on 1MDB is that people in his own party realise the magnitude of money going around, and that the cake is not being shared equally,” said Rafizi Ramli, the opposition’s leading graft whistle-blower.