February 14, 2004

PM's graft war right on money

By Southeast Asia correspondent Kimina Lyall

THE Anti-Corruption Agency in Malaysia has a mission statement, a motto - trustworthiness, firmness, fairness - and even a corporate song.
What it hasn't had in its 36-year history is bite. Despite strong anti-corruption laws, under the 22-year leadership of Mahathir Mohamad, Malaysia gained an international reputation for money politics, patronage and cronyism.
So when wheelchair-bound Eric Chia, a businessman so close to Mahathir he was given a diplomatic passport, was wheeled into a courtroom on Tuesday morning to face charges he illegally sent 76million ringgit ($25.2million) of public money to a false Hong Kong bank account, the shockwaves rippled through Malaysia's elite.
Chia, 71, who was handpicked by Mahathir in the late 1980s to rescue the failing Perwaja Steel corporation -- a mission he did not accomplish -- had been investigated for eight years but was considered untouchable because of his connections.
His arrest was the clearest sign yet that Prime Minister Abdullah Badawi would deliver on his promises to rebuild trust and integrity in Malaysia's institutions.
Two days later, a low-profile cabinet minister and member of Abdullah's own political party, the United Malays National Organisation, was to follow Chia, when Kasitah Gaddam, 56, appeared before the courts charged with illegally selling shares in a state-owned enterprise.
Since he took office a little more than 100 days ago, Abdullah has vowed to fight corruption, committing his personal reputation for spiritual integrity to the future of his notoriously corrupt party.
Abdullah arrived at his first cabinet meeting as leader in November with a modest to-do list: cut red tape, re-engineer administrative land offices and create a Malaysian Institute of Public Ethics and a national Integrity Plan.
It was a far cry from his predecessor, and more in keeping with Abdullah's mantra that he would usher in a change of style, not policy.
"He talks very friendly but he is very strict," says Works Minister Samy Vellu, who explains that Abdullah now arrives at cabinet meetings with a four-column document charting the progress made on his directives. "He asked us to work with him and we are happy to support him."
However, few observers expected he would move so dramatically against his party and his former mentor.
Within weeks, Abdullah had quietly cancelled a 14.5billion ringgit railway contract, awarded in the dying days of the Mahathir regime to a businessman close to the then prime minister, reportedly cancelling letters of intent sent to the Indian and Chinese governments. He then announced that major public contracts would be issued by tender, rather than favour.
Abdullah removed the police chief and set up a royal commission into the police, appointing the man Mahathir sacked as chief justice, Mohamed Dzaiddin Abdullah, as its head and putting government critics on the panel.
The corruption cases brought so far are not among the worst in Malaysia. Abdullah's senior officials insist only cases with a strong chance of successful prosecution will be pursued -- perhaps a way to sidestep action against some of Malaysia's most notorious, and powerful, corrupt officials.
Most observers believe Abdullah is driven by the courage of his convictions, but he is probably also looking for votes. He must win back the support of the Malay community, which has been leaking to the fundamentalist Islamic PAS party, if he is to solidify his party's vote.
Abdullah may yet be tarnished by a family insider. It emerged last week that his only son, Kamaluddin, was the main shareholder in the parent company of Scomi Precision Engineering, which produced centrifuges shipped to Libya as part of the black market in nuclear equipment.
An investigation began almost as soon as Abdullah took office, but details of the link did not emerge until the father of Pakistan's nuclear bomb, Abdul Qadeer Khan, publicly confessed he had been selling state secrets.
Intelligence officials agree with the company's claims that it filled the order without realising its deadly purpose, but, as one official said, Malaysia's connection to the trade in secrets "doesn't look good".

Parent site: "Focus on Malaysia"