Malaysia’s Prime Minister Najib Razak has shelved plans for an early general election this summer after the leaking of a mountain of documents dealing with the payment of over $180 million in bribes for the purchase of two French submarines when he was defence minister. Even more damaging for Najib, who has yet to face the electorate since taking over as leader of the stumbling Barisan Nasional coalition government in 2009, is that the documents indicate the French giant shipbuilder, DCNS, paid $45 million for a classified Malaysian government document detailing its submarine requirements.
This money and the other $142 million were paid to companies controlled by Najib’s friend and policy adviser, Abdul Razak Baginda. Opposition politicians in Malaysia are claiming that, if confirmed, the sale of the classified documents which would have given the French manufacturers of the Scorpene class submarines an advantage when tendering for the $1.1-billion deal, amounts to treason. Malaysia’s current defence minister, Ahmad Zahid Hamidi, last week tried to extinguish the political fires by denying that there had been any sale or leaking of the defence department documents.
Zahid told the Malaysian parliament the submarine deal was done through “direct negotiations in accordance with procurement procedures.” And he insisted, “The ministry has never paid any commission directly or indirectly to any companies in the procurement of the Scorpene submarines.” But that is not the allegation. The allegation is that the French company DCNS paid nearly $190 million to companies controlled by Najib’s close friend Baginda. Najib took over the government leadership after the ruling coalition, which has run the country since Malaysian independence from Britain in 1957, made a poor showing in the last elections in 2008.
He has tried to cast himself as a reformist prime minister, but his tenure so far has been riven by scandals. In recent months there have been large hints from officials in Najib’s party, the United Malays National Organization (UMNO), that he would call an early election, perhaps in July. But last week Najib’s parliamentary assistant told Parliament the government intends to hold elections only after completing its five-year mandate next March. This Scorpene submarine story has been bubbling since 2006 with the discovery of the body of Baginda’s jilted mistress, Mongolian model and translator Altantuya Shaariibuu.
She was abducted from outside Baginda’s house where she had gone to demand a $500,000 cut from the bribes to keep quiet about the deal with the French in which she had acted as Baginda and Najib’s translator. Two of Najib’s bodyguards have been convicted of Altantuya’s murder and have been sentenced to death. They have launched appeals against the sentences. To the surprise of many, a judge dropped murder charges against Baginda before any evidence was heard and he has been in exile in Britain since. Najib’s mounting problems with the Scorpene case came to a boil last week with the leaking of 133 files containing hundreds of pages to the Asia Sentinel online magazine, whose editor John Berthelsen has been the leading reporter on the story for several years.
The documents are part of the product of a raid on DCNS’s Paris offices by the anti-organized crime unit of the French Directorate of Judicial Police in April 2010. French officials started investigating the case the previous month at the request of a Malaysian human rights organization, Suaram, and in June 2011 presented the evidence to the prosecuting magistrate of the Court de Grande Instance in Paris, who is now considering whether to file charges. The picture that emerges from the leaked documents, which Asia Sentinel has made available on its website, is that after Najib was appointed defence minister in 1991 he embarked on a massive military modernization program.
Along with new jet fighters, tanks and coastal patrol boats he wanted submarines. But by 1995 the French manufacturer DCNS felt it was being out-lobbied by the German company Kockums AB. DCNS decided to buy influence and after several false starts latched on to Najib’s friend and policy adviser Baginda. “The role of the latter,” says one of the DCNS documents, “was to facilitate the submission procedure to the Malaysian government and the responsible ministers, in particular the minister of defence, with whom he claimed to have a close relationship.”
In 2000 the equivalent of $142 million was given to a company called Perimekar, which was controlled by Baginda’s wife, Mazlinda Makhzan. In other documents DCNS officials said they expected the money to be shared with other individuals and with the ruling party in the governing coalition, UMNO. Another $45 million, apparently for the defence ministry’s document specifying its submarine requirements, was paid to a Hong Kong-based company, Terasasi, whose principal officers are listed as Baginda and his father.
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