Mahathir wants Australia to step into Malaysia


The Australian

In view of his record, former Malaysian prime minister Mahathir Mohamad’s call for Australian intervention in the 1MDB state investment fund scandal swamping incumbent Prime Minister Najib Razak is supremely ironic.

Dr Mahathir, 90, made his comments to Southeast Asia correspondent Amanda Hodge. His argument that “foreign interference” in the crisis is warranted starkly contradicts the rabid nationalism that was his hallmark in office from 1981 to 2003.

In 1993, Paul Keating famously dubbed Dr Mahathir “recalcitrant” when the Malaysian leader refused to attend the first Asia-Pacific Economic Co-operation summit in Seattle. During that row, Dr Mahathir complained that the West “tells the Asians how to behave themselves”. Now he wants Australia to do precisely that, no doubt to embarrass Mr Najib, whom he wants to see hounded from office.

Dr Mahathir also dug in stubbornly against the rest of the world during the 1997 Asian economic crisis, which he blamed on a worldwide conspiracy of Jewish financial traders. He defied the International Monetary Fund and used currency controls to isolate Malaysia temporarily from the global economy.

That said, Dr Mahathir’s comment that Mr Najib’s opponents have exhausted all avenues inside Malaysia reflects the serious crisis surrounding the country’s state investment fund that has tarnished Malaysia’s reputation as a centre for investment. But like all sovereign states grappling with corruption, Malaysia, a functioning democracy, must use its regulatory authorities and strengthen them if necessary to resolve the issues and improve transparency and accountability.

Its parliamentary Public Accounts Committee has found 1MDB paid out more than $US4 billion, without its board’s approval, to companies whose ownership is being questioned. In another controversy, Mr Najib is also under fire over his lavish lifestyle and $1.3bn allegedly transferred into his personal bank accounts, including a $680 million gift from the Saudi royal family.

Dr Mahathir’s call overlooks the fact it would be inappropriate for Australia to interfere in a Malaysian domestic matter, however serious. Such meddling could only undermine the strong defence, security, economic, trading and humanitarian relationships that benefit both nations. The latter was reflected in Australia’s swift and generous responses to the disappearance of Malaysia Airlines flight MH370 in March 2014 and the shooting down of MH17 over Ukraine four months later.

Since 1971, Australia, together with Britain, New Zealand, Singapore and Malaysia, has been committed to the Five Power Defence Arrangement, under which the five nations would consult and respond to any armed attack on Singapore or Malaysia. Defence co-operation between Australia, Malaysia and other regional nations is also essential to checking any encroachment of Islamic jihadism and to maintaining security in the South China Sea.

Australia’s two-way trading relationship with Malaysia is our eighth largest. It grew by 25 per cent over five years to $20bn in 2014, with vast scope for expansion. Investment-wise, it is in Australia’s interests for Malaysia to sort out its financial controversy. Nations learn from outside experience, but they must forge their own pathways to good governance.