Najib embarrasses Obama

March 30, 2016

1MDB scandal embarrasses President Barack Obama and strains US-Malaysia relations

by David J Lynch in Washington

US President Barack Obama (R) greets Malaysia's Prime Minister Najib Razak upon arrival at Sunnylands estate for a meeting of the Association of Southeast Asian Nations (ASEAN) on February 15, 2016 in Rancho Mirage, California. / AFP / Mandel Ngan (Photo credit should read MANDEL NGAN/AFP/Getty Images)

Malaysia’s Prime Minister Najib Razak, left, and US President Barack Obama during the ASEAN leaders meeting in California in February

In 2014, Malaysia’s Prime Minister Najib Razak bonded with US President Barack Obama over golf and a presidential “selfie”, as the White House sought to cultivate Malaysia as a counterweight to both China and ISIS.

Less than two years later, the mushrooming 1MDB scandal is complicating those efforts as Mr Najib faces multiple investigations into the 1 Malaysia Development Bhd state investment fund.

 “It definitely is already threatening the relationship. You can tell from any number of angles,” said James Keith, US Ambassador to Malaysia from 2007 to 2010. “Already, there’s a bit of symbolic distance between the President and Najib, which is likely to persist.”

The latest twist occurred last week when former Prime Minister Mahathir Mohamad filed suit against Mr Najib, accusing him of blocking an investigation into the fund, including allegations that nearly $700m had ended up in his personal accounts.

Mr Najib has repeatedly denied wrongdoing and his attorney-general earlier this year cleared him of any criminal offences. Probes in Switzerland, Hong Kong and the US continue. A Department of Justice spokesman declined to comment.

During Mr Obama’s presidency, Malaysia has drawn closer to the US, adopting a harder line on China’s island-building in the South China Sea and joining the Trans-Pacific Partnership trade pact. Mr Najib, who in November labelled ISIS “perverted Islam”, also agreed to establish a digital centre to counter the terrorist group’s internet propaganda. Now, the Malaysian leader is increasingly distracted by the global 1MDB controversy.

“It certainly will make for a more inwardly focused Malaysian government that’s less able to take on a leadership role,” said Mr Keith, now McClarty Associates’ senior director for Asia.

Mr Najib is not scheduled to be among the more than 50 world leaders attending a nuclear security summit in Washington at the end of this month. New restrictions on reporting about the scandal also drew sharp US criticism, with the State Department earlier this month saying it was “very concerned” by Malaysia’s crackdown on domestic and foreign journalists as well as new limits on social media.

Some analysts bemoan opportunities lost to the mounting 1MDB fallout.“Obama and Najib really got along well,” said Ernest Bower, chief executive of Bower Group Asia, a consultancy. “The leader-to-leader relationship would have gone much deeper and more high profile if Najib weren’t under this cloud.”

The diplomatic stall comes after longstanding Obama administration efforts to convert Malaysia into a more dependable US partner than it had been under past leaders such as Mr Mahathir.

In April 2014, Mr Obama travelled to Kuala Lumpur, becoming the first US president to visit since Lyndon Johnson in 1966. Nineteen months later, he visited for a second time, hailing Malaysia as “a Muslim-majority country that represents tolerance and peace”.

Since then, the 1MDB affair has only drawn greater scrutiny. “People are talking about it. They’re wondering where this is going to go,” said Murray Hiebert, senior fellow at the Center for Strategic and International Studies in Washington. “Can Prime Minister Najib survive?”

Mr Najib’s position, though bruised, is not in imminent danger. He retains a parliamentary majority and all the power of incumbency. Elections are not due until 2018.

Though he will miss the Washington nuclear summit, he was among the Association of Southeast Asian Nations (ASEAN) leaders who met Mr Obama in February at the Sunnylands estate in Palm Springs, California.

Investors also do not appear unduly worried. The ringgit, though 6 per cent below its level last summer when allegations about Mr Najib first surfaced, is at a seven-month high against the US dollar.

The stock market has been treading water.“No doubt this is a distraction,” said one senior state department official. “But our relationship is much stronger than it used to be.”


10 thoughts on “Najib embarrasses Obama

  1. Finally, The White House realises Najib is an embarrassment to President Obama. Let us hope the next US President who takes over in January, 2017 will be less chummy with the most corrupt Prime Minister of Malaysia. –Din Merican

  2. The mere fact that at least one million Malaysians have voted with their feet and left 1Malaysia, should tell President Obama that 1Malaysia under UMNO Baru’s kleptocratic rule (where the rule of law is a joke) is not
    “a Muslim-majority country that represents tolerance and peace”.

  3. “Donation” that is used for Jewelry, Fashion, Holliday, Jewelry, Exotic Cars..Obama should be asked, if US Presidents are in the habit of being friends of people who should be jailed like Al-Capone was.

  4. We cannot hope for the next US President to be less chummy than Obama… I have never trusted the US to do the right thing…. they will do whatever that will benefit them diplomatically, commercially and not necessary doing the right thing… over the years (esp under Obama) I have lost faith in the US moral compass…

  5. In politics anything could happen. Foes of today become friend of tomorrow. Hypocritical world of clowns. There are no true leaders but a bunch of tail wagging dogs without sense to read the good and the bad. Even a dog could sense when something went wrong.

    You can read of what Najib’s stooges speak of after the ABC release of 4 corners news > too good to be true. Are they trying scorn people who spoke against this unending episode of Obama’s golfing buddy?

  6. If Donald is the next president, things will be different, wrt us- Malaysia relations. Donald will be a refreshing change from ex “NGO” president Obama.

  7. ” The White House realizes Najib is an embarrassment to President Obama ”

    I believe ,
    in the end, the *great ” elite leaders, those at Sunnylands (their embarrassment) would cancel each other out, together with other leaders of the world .

    With their invisible and invincible hands, often treacherous, scheming from behind the scenes, are the real global shame and embarrassment to the people of the world, except may to a few Donald Trumps —-all because of greed,power and dominance over their targeted regions and sadly,at the immeasurable pain and expense of the people wherever they are.

    Such were the painfully wicked events that repeatedly being played on stage over and again in historical time …..

    Sigh, …..

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