Malaysia facing major corruption crisis, global anti-graft watchdog says

Transparency International called on the Malaysian government to ensure independent investigations into all corruption allegations and a follow-through with prosecutions and punishments against the perpetrators regardless of their identity. — Picture by Yusof Mat Isa
Transparency International called on the Malaysian government to ensure independent investigations into all corruption allegations and a follow-through with prosecutions and punishments against the perpetrators regardless of their identity. — Picture by Yusof Mat Isa

KUALA LUMPUR, Sept 1 — Just two days after a mammoth rally calling for institutional reforms and the resignation of Prime Minister Datuk Seri Najib Razak over corruption allegations over a RM2.6 billion donation, Transparency International (TI) announced today that Southeast Asia’s third largest economy is facing a serious corruption crisis.

With members from over 100 countries, the non-governmental world anti-corruption organisation said it is seeking a strong commitment from the Malaysian government in three key areas.

“Malaysia is facing a major corruption crisis,” TI said in a brief statement issued after its annual membership meeting in Putrajaya.

It called on the Malaysian government to ensure independent investigations into all corruption allegations and a follow-through with prosecutions and punishments against the perpetrators regardless of their identity.

“If Malaysia is to get through its current crisis, then the government must let those who know how to investigate corruption do their job. The Malaysian Anti-Corruption Commission must be able to act independently and be free from political interference,” José Ugaz, TI chairman, said in a later statement.

The call was among three resolutions passed today at the global anti-corruption organisation’s Annual Membership Meeting in Putrajaya, Malaysia.

The watchdog said many countries around the world face similar crises and the commitments should apply to them as well, but made a seemingly unusual note specific to Malaysia in its statement.

The global watchdog also resolved to press for reconciliation and amnesty laws that do not legalise impunity, and pointed to recent developments in Mongolia which passed a new law to grant amnesty to anyone being investigated by its anti-corruption body.

TI noted too that the Tunisian parliament is weighing a similar law that would allow people who stole public funds to be given amnesty for past crimes.

Tens of thousands of Malaysians took to the streets in the national capital on Saturday and Sunday in a 34-hour demonstration to pressure the prime minister to step down from office.

Organised by electoral reform group Bersih 2.0, the rally dubbed Bersih 4 had five official demands: clean elections; clean government; right to dissent; strengthening parliamentary democracy and saving the economy.

Like many other countries worldwide, Malaysia’s economy has been affected by recent economic rumbles in China, but its currency has only recently recovered from a 17-year low when it plunged to below the RM3.80 peg to the US dollar instituted following the Asian Financial Crisis of 1998.

Foreign investor confidence in Malaysia has also been hit, with ratings agencies Moody’s and Fitch both warning of a possible downgrade to Malaysia’s credit outlook.

On June 30, Fitch had revised the country’s sovereign credit outlook to “positive” from “negative” previously.

On July 3, a political storm erupted over a Wall Street Journal article on debt-laden state fund 1MDB stating that almost US$700 million (now estimated at RM2.9 billion) from 1MDB had been deposited in Najib’s personal bank account, international news wire Reuters reported.

Najib has denied any wrongdoing, saying that he has not received money from 1MDB or any state agency for his personal gain.

Malaysia’s anti-graft commission has also said the funds were a political donation from a Middle Eastern nation, but without revealing the identity or source of the donors.

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