Malaysia S Corrosive Nexus Of Politics And Business

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When UMNO was declared illegal in 1988 because of its election irregularities, the learned judge did not in his wisdom specify what to do with those lucrative assets held in secret by the party’s nominees. 
M. Bakri Musa
Tun Daim Zainuddin, who died on November 13, 2024, represented the era where money and politics were closely intertwined in an opaque, very personal, and often incestuous relationship. The result was (and is), as elsewhere, pervasive corruption on a grand scale.
Malaysian money politics is also overshadowed by, as with everything else, race. Hence the incendiary element. UMNO (United Malay National Organization) leaders, specifically Mahathir, Daim, and Najib Razak, successfully hoodwinked their followers as well as Malays generally that these leaders’ personal interests were aligned with the party, race, and nation. They would have portrayed themselves as also the champions of Islam but for the Islamic Party (PAS) thwarting their efforts.
Mahathir and Najib were longtime Presidents of UMNO while Daim, its perennial money bag holder. Daim has died, Najib is in jail for corruption, and Mahathir, ailing, watches helplessly as his adult sons are being hauled before the Anti-Corruption Agency. He is also enmeshed in multiple civil litigations. Mahathir, who together with Daim quit UMNO in 2016, was politically castrated during the 2022 General Elections, as was UMNO.
UMNO’s money politics began when Mahathir became its president in 1981, and with that the country’s leadership. Elections are expensive and unlike his predecessors, Mahathir chafed at having to beg the leaders of his ruling coalition partners for election funds. I remember Tengku Abdul Rahman campaigning in my village in the 1955 and 1959 elections. He had to sleep in the house of one of the UMNO members and be driven around by volunteers. Mahathir would have none of that. He had his pride, self as well as racial.
Thus began UMNO’s “millionaire envy” that led to its heavy involvement in business. Initially they were simple import/export permits. If those had spawned the blossoming of a genuine Malay entrepreneurial class, then they could have been defended and indeed applauded. Alas that was not to be. Instead, those nouveau riche UMNOPutras solidified themselves into a permanent, fast expanding, and ever voracious rentier class. Thus was born crony capitalism, Malaysian style, with government-linked companies emerging like gnats after a downpour. Many had about the same lifespan. The graveyard of corporate Malaysia is filled with the likes of Maminco (tin mining), Perwaja Steel, and Bank Bumiputra.
As for the few successful enterprises held by UMNO nominees, as things turned out they had an unexpected bonanza. When UMNO was declared illegal in 1988 because of its election irregularities, the learned judge did not in his wisdom specify what to do with those lucrative assets held in secret by the party’s nominees.
Perversely today those lucky UMNO “menengek (anointed) millionaires” like Halim Saad and Tajuddin Ramil are suing Mahathir. Pure gall or height of ingratitude, take your pick.
In the early 1980s Mahathir tried to corner the tin market. That folly cost Malaysia over RM 1.2 billion (1980 figures, estimated by the American Central Intelligence Agency). Worse, that destroyed the tin industry. Malaysia was the top tin producer then. Mahathir thought he was smarter than the Hunts brothers who earlier tried to control the silver market. The Hunts used their own money; Mahathir gambled with funds that rightly should have gone to schools.
Bank Bumiputra collapsed following excessive exposure to Hongkong’s George Tan, but not before a smart, honest young Malay banker, Jalil Ibrahim, was murdered in cold blood. He was investigating the shenanigans there. Mahathir’s George Tan was an earlier and slightly less expensive version of Najib’s later Jho Low. Perversely, both are now spun as yet another crooked Chinese hoodwinking an honest Malay leader. That also fits Malaysia’s race narrative.
Former Law Minister Zaid Ibrahim revealed in his recent podcast that he once prepared papers to sue Daim for non-payment of his Bank Bumiputra loan. Zaid withdrew that lawsuit because of last minute instructions. I hope for the sake of Zaid’s professional integrity that instruction to withdraw came from his client.
In one of my books, I enumerated the long list of favorable “goodies” Daim obtained from the state, including his very first enterprise, salt-making, that eventually failed. I also congratulated him for his many charities. Daim wrote to me saying that I had unfairly characterized him. I replied that if he could point to any error in the facts that I had cited, then I would reexamine my conclusion and also publicly apologize to him. Never heard back!
Mahathir claimed victory with the so-called Dawn Raid on the London Stock Exchange wresting control of Guthrie Plantations. Hundreds of millions of pound sterling (of public money) were spent, yet not a single rubber tree was planted. Worse, that “victory” distracted Malays into sunset-industries like tin and rubber, leaving emerging sectors like tourism and technology to non-Malays.
Then consider the opportunity costs. Had the funds been spent not on buying Guthrie but to clear new plantations, that would have at least added to the nation’s productive capacity. Better yet, use those funds to improve rural schools. That Dawn Raid benefited only the foreign brokers, investment bankers, and institutional shareholders like the Kuwaiti fund who sold their shares to the Malaysian entity, at a premium of course.
Only Allah knows Daim’s fate in the Hereafter, or what will await Najib and Mahathir. This much is certain. Daim and his loved ones endured Hell towards the end of his life, just as Najib and Mahathir are now suffering theirs.
The post Malaysia’s Corrosive Nexus Of Politics And Business appeared first on Malaysia Today.

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