Money politics inflame Malaysia’s election season

Allegations that billionaire Robert Kuok is secretly funding an opposition party sparks new rounds of race-baiting and debate over political donations

Originally published by Asia Times (March 8, 2018)

 

Malaysia’s richest man, billionaire Robert Kuok, has recently become something of a punching bag for the country’s two main political coalitions as a general election draws near. A blogger writing for Malaysia Today, a news portal, claimed late last month that Kuok has been secretly funding the Democratic Action Party (DAP), a multi-ethnic composite party of the opposition coalition known as Harapan. Raja Petra Kamarudin, the blogger, alleged that funds were channeled through one of Kuok’s nephews, an accusation the billionaire has strenuously denied and threatened to take legal action against. The DAP has also denied receiving money from Kuok.

Amid the denials, threats and media circus, the United Malays National Organization (Umno), the main party of the ruling Barisan Nasional (BN) coalition, has leapt headfirst into the controversy. Mohamed Nazri Abdul Aziz, the Minister of Tourism and Culture, went as far as to describe Kouk as a “coward” and asserted that the billionaire should give up his Malaysian citizenship. Though a Malaysian national, Kuok, 94, is based mainly in Hong Kong. Prime Minister Najib Razak even waded into the debate, saying in a statement that the wealthy, including Kuok, should remember that their riches were earned thanks to successive Umno-led government policies. Umno has been in power uninterrupted since Malaysia achieved independence from colonial rule.

Kuok, with interests spanning commodities, energy, property, publishing and finance, is estimated to be worth more than US$15 billion, making him the world’s 96th richest person, according to Forbes. (Kuok could not be reached for comment for this story.)

Significantly, Umno’s attacks on Kuok, an ethnic Chinese Malaysian, were refuted by the Malaysian Chinese Association (MCA), an allied party in the ruling BN coalition. The party’s youth chief Chong Sin Woo asked for Umno politicians to apologize for their comments.

The Kuok saga has again dredged up not-so-subtle undertones of racial politics that typify Malaysia’s political discourse, particularly in an election season.

The tacit accusation behind the allegation is that as a Sino-Malaysian Kuok is trying to remove the ethnic Malay-centric Umno from power. One Umno assemblyperson from Johor even called the MCA “racist” for defending Kuok, though he was reprimanded by a party whip over the comment.

In recent months, Umno has been accused of repeatedly whipping up anti-Chinese sentiment ahead of the upcoming general election, which must be held before August.

This is partly because the battle for Malay Muslim voters, who make up the majority of the electorate, has intensified since the formation of another Malay-centric party, the Malaysian United Indigenous Party (PPBM).

Founded in late 2016 by ex-Prime Minister Mahathir Mohamad who previously headed but recently resigned from Umno, the PPBM joined the opposition Harapan coalition last year.

Mahathir is now the coalition’s prime ministerial candidate for the upcoming elections, which some analysts think will be one of the closest in recent times. He has also bid to galvanize anti-Chinese sentiment in the run-up to polls.

While the ongoing Kuok saga has shown how the sensitive matter of race can easily be dredged up by opportunistic political parties, it has also raised hard questions about political party funding.

Malaysia’s laws on political party financing and spending are lax. Political candidates are limited to only spending RM200,000 (US$50,000) in running for parliamentary seats and RM100,000 (US$25,000) for state seats. But there is currently no law on how much can be spent by any party.

Meanwhile, political parties are supposed to disclose their financial statements to the Registrar of Societies, which monitors public-registered organizations, but there is currently no requirement for parties to disclose from whom it receives donations.

During his first year in office, premier Najib raised the prospect of party funding reforms, an issue subsequently taken up by several parliamentary committees.

It wasn’t until 2016, however, that plans were afoot to introduce the Political Donations and Expenditure Act (PDEA), a piece of legislation that would create an independent audit body to monitor donations and expenditures.

All donations worth more than RM3,000 (US$770) would have to be disclosed, including the identity of the donor, according to the PDEA.

But progress in passing the PDEA has since stalled. Umno is now thought to want to delay enacting the measure until after this year’s election, reportedly because it is still being drafted.

Money politics is a sensitive subject for Najib. Allegations surfaced in 2015 that he may have pilfered more than US$1 billion from the 1Malaysia Development Berhad (1MDB), a failing state investment fund he founded and oversaw.

Although Najib was cleared of any wrongdoing by the Attorney General, it was later revealed that the US$681 million transferred into Najib’s personal accounts was a “donation” from the Saudi royal family, which is questionable but not illegal under Malaysian law.

In recent days, Pakatan Harapan has taken up the baton of party funding reform. DAP parliamentary leader Lim Kit Siang raised the issue of the PDEA last weekend, commenting that all political parties need to support the legislation as it would “end money politics.”

“It should be legalized to allow Malaysia to move towards mature politics. Transparency is needed,” he added.

On March 5, one of the PPBM’s chief strategists, Rais Hussin, announced that the Harapan coalition will include political party funding reforms as part of its manifesto, which is expected to be announced on March 8.

So far, the opposition coalition has not commented on whether their proposed reforms would be along the same lines as the stalled PDEA or even more strict.

There is speculation that Harapan’s recent interest in party funding came after PPBM politicians met last week with a civil-society coalition that has long pushed for party funding reform, known as the Governance, Integrity, Accountability and Transparency coalition, or GIAT.

Today Online, a local newspaper, reported this week that the GIAT has asked political parties to commit before elections to several reforms, including a provision that requires all elected officials to declare their assets and political parties to declare their income and expenditures.

“These are the things we are fighting for. Time for [the groups] to join PPBM as well,” the Today Online quoted Rais.

Such comments raise suspicions that the Harapan coalition, which has been widely charged of putting personality before policy, is now trying to win over civil society organizations ahead of polls.

That might be the case, but it’s less clear if proposed party funding reforms or new curbs on party corruption will have any effect on how the electorate votes at the ballot box.

A year after the 1MDB scandal first broke, the opposition coalition campaigned on the corruption allegations in two by-elections in Sungai Besar and Kuala Kangsar. Still, the BN won both by-elections with increased margins.

Thereafter, Mahathir questioned whether corruption and party donations were really major concerns for ordinary Malaysians, the New Mandala reported at the time.

“People are openly talking about [corruption] if they understand it, but among others, among the villagers, they do not understand the problem,” the ex-premier said.

“The educated ones, the leadership of the opposition for example, thought that this 1MDB [was] an issue with the people, but most of the electorate [did] not.”

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