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It’s
becoming the highest-rating program in Asia: Malaysia’s
crime- scene investigations.
Just
like its wildly popular American counterparts, this
crime drama—call it “CSI Malaysia”—features sex, murder,
DNA samples, cover-ups and a colorful cast of characters
wondering who’s guilty of this or that.
At the
center of Malaysia’s CSI franchise is Anwar Ibrahim, a
former deputy prime minister who did time on corruption
and sodomy charges. Last week, Anwar was arrested on new
sodomy claims. He accuses Deputy Prime Minister Najib
Razak—who denies sexual-misconduct allegations related
to a 28-year-old Mongolian woman killed two years ago—of
manufacturing the charges to discredit him.
The
storyline is captivating this nation of 26 million
people, most of whom are Muslim. It’s sparking steamy
and decidedly awkward debates about how one defines
sodomy and whether it should be a crime. (It is, under
Malaysian law.)
Surreal
subplots abound. Mahathir Mohamad, the man in power when
Anwar was jailed a decade ago, has been fighting a very
public war of words against his successor, Prime
Minister Abdullah Ahmad Badawi, over corruption
allegations.
Events
in Kuala Lumpur would be far more entertaining if they
were confined to a television screen—and not denting the
image of one of Asia’s most promising economies.
Shifting
in seats
Many
Malaysians aren’t quite sure what to think. Are the
charges against Anwar trumped up to keep him from
toppling the government? Is the male aide who claims to
have had sex with Anwar telling the truth? If Anwar is
innocent—he claims he has never engaged in sodomy—why
not submit a DNA sample and clear himself? If you were
Anwar, would you trust authorities not to taint the DNA
test?
It was
impossible to avoid this issue at a Bloomberg panel
discussion on July 17, the day after Anwar was arrested
(and the day on which he was released). On the panel
were bigwigs from the likes of Malaysia Airline System
Bhd., Maxis Communications Bhd. and CIMB Investment
Bank. You could see them shifting nervously in their
seats as the issue of sodomy came up.
If
Malaysians don’t know what to make of Anwar’s plight,
you can imagine what foreign investors think. “Summer of
Discontent” is how Deutsche Bank AG analyst Teoh Su-Yin
titled a recent report on Malaysian stocks.
Last
week, it was hard to find an analyst predicting a quick
resolution to Malaysia’s fragile political backdrop. Nor
could I find anyone in Kuala Lumpur who felt markets had
fully priced in the negative impact of higher inflation
on the economy and corporate earnings.
Changing
world
What’s
so frustrating about Malaysia is the obvious potential.
Its natural-resource-rich economy has achieved great
things in the 50 years since independence from Britain.
Twenty-five years ago, this was a tropical backwater.
Today, Malaysia’s modern, skyscraper-filled capital is
home to the world’s tallest twin buildings, the Petronas
Towers.
Yet, the
world is moving ahead at a rapid pace, hastened by the
rise of China and India. It won’t wait for Malaysia, and
the current scandals preoccupying the government are
coming at the worst possible time. Malaysia should be
acting boldly to increase its global competitiveness.
Nations
as diverse as China, India, Indonesia, Thailand and
Vietnam are working to raise their global influence.
Five years from now, any of these economies might
harness specific advantages, from low costs to human
capital to technology, to challenge Malaysia’s growth
prospects.
Leadership vacuum
Malaysia
should start by fixing a key weakness: a four-decade-old
affirmative-action program favoring the predominant
Malay community. It limits investment, stifles
competition and keeps the economy from becoming a
meritocracy. It’s a third-rail issue and isn’t discussed
seriously.
The
leadership vacuum in Kuala Lumpur means Malaysia is
squandering time its economy doesn’t have. Its
$151-billion economy is becoming a smaller blip on
investors’ radar screens, and politics deserve much of
the blame.
Abdullah
is under pressure to quit after his coalition’s
worst-ever election result in March. Earlier this month,
he announced plans to stay in power for two more years
as his chosen successor, Najib, faces sexual-misconduct
allegations. What has the makings of a trashy novel has
become reality, and it’s not clear Malaysia’s leaders
see that.
Unstable
situation
Malaysia, it seems, is being run for the sole benefit of
those in charge. The nation has become more about
Abdullah’s party, the United Malays National
Organization, than the welfare of its people. That’s not
being lost on overseas observers.
“Investors are already considering the situation as
unstable,” says Tricia Yeoh, director of the Centre for
Public Policy Studies in Kuala Lumpur. “They are already
reconsidering their options in the country. The new
investors are possibly not looking at Malaysia as a
viable option, and previous investors would be thinking
of extracting their funds to be put in more stable and
viable locations.”
Financiers may be perfectly happy to watch CSI at home.
They are far less keen on exposing their money to a
whodunit playing out on Malaysia’s national stage. |
