ALLOW ME TO refer you to the Oxford English Dictionary’s definition of ‘farce’: “A comic dramatic work using buffoonery and horseplay and typically including crude characterization and ludicrously improbable situations.”
Now consider the events surrounding the large sum of money that found its way into Malaysian Prime Minister Najib Razak’s personal bank account a few years ago. There’s certainly been buffoonery and a series of ludicrously improbable situations. Perhaps horseplay has been lacking, but an alternative definition from the same dictionary seems oddly fitting: “An event or situation that is absurd or disorganised.”
This particular farce kicked off last July when the Wall Street Journal claimed almost US$700m had found its way into Najib’s personal account via Malaysian government-owned investment company 1MDB.
With all the flavour of a Carry On film (readers of a certain vintage who grew up in Britain and certain of its former colonies will be familiar with that brand of British slapstick fare) denials were issued from the prime minister’s office, members of investigative committees were shifted, the attorney general replaced, associated individuals vanished overseas and bank accounts were frozen as foreign investigators got on the case.
The deus ex machina which emerged last week, seemingly to draw the farce to a conclusion without stifling the laughs of the attendant global audience, is that the funds in question came from the royal family of Saudi Arabia in the form of a political donation. Most of the cash has since been returned, and Malaysia’s Attorney General Apandi Ali last Tuesday declared the case against Najib closed.
THE LATEST TWIST certainly follows the script written by the prime minister’s supporters: all the criticism levelled against Najib has been an attempt by his detractors to force him, quite unfairly, from office.
I keep thinking of Kenneth Williams hamming it up as Julius Caesar in one offering from the Carry On stable, shouting “Infamy! Infamy! They’ve all got it in for me!” as he is stabbed in the back by errant senators.
In the Malaysian version of the play, Najib faces no such fate, and appears to have headed his detractors off at the pass. But whatever the origin of the funds deposited into Najib’s account and the farcical nature of the manner in which events have played out, the truth is that the whole affair is a tragedy for Malaysia and ordinary Malaysians.
It’s not easy to gauge just how much numerical impact Najib’s involvement in this debacle has had on the exchange rate of the Malaysian ringgit, or on Malaysian offshore credit spreads, or on Malaysia’s credit rating.
Or to divine the impact of the “missing millions” scandal on the country’s political culture and the future generations who might wish to join it.
Absent Najib, would all that have happened anyway because of low oil prices and China-led weakness in Asian demand? Yes it would, but perhaps not to the same extent.
Oddly, as Najib has become the focus of the payment scandal, 1MDB has moved out of the spotlight. That will have been a relief to 1MDB’s senior management as they go quietly about reducing the US$11bn-odd of debt that sits on the company’s balance sheet. The recent rebound in prices of 1MDB’s standalone offshore debt from distressed territory into the mid to high-80s will also have been a relief.
Still, it’s a shame investors can’t get a ready market on offshore 1MDB paper because many traders won’t touch it due to the scandal-related reputational risk.
IN THE MEANTIME, China General Nuclear Power Group has indicated it will buy 1MDB’s portfolio of 13 power plants to the tune of US$2.3bn. That will help a little in reducing the debt pile at 1MDB. As will the sale of land in the Bandar Malaysia property development to a Chinese-owned consortium. That sale was announced by 1MDB on New Year’s eve as for US$1.7bn and hailed by Najib as signalling that 1MDB’s woes had turned the corner. But the ambiance of farce returned barely a week later when the value of the 60% stake in the project to be bought by the consortium was clarified, and appeared to be around US$500m lower.
If I were a Malaysian voter I would want to see the exact price that land was sold to 1MDB for in the first place. And I would want to know just where the funds from the US$11bn of debt raised by 1MDB have ended up.
The Malaysian attorney general’s closing of any potential case against Najib might seem to be the final act in this particular farce, but it seems there may be a twist in the tail. According to a Reuters report published last week, the Malaysian Anti-Corruption Commission had recommended to the attorney general that Najib be charged with criminal misappropriation in connection with the US$681m which found its way into his bank account.
The MACC is seeking a review of the attorney general’s decision. Might that transform the tone of events from farce to harsh reality? We shall find out in due course.
