Malaysia: PM’s New Cabinet Includes Graft-Tainted Ally As His Deputy – Analysis

New Malaysian Prime Minister Anwar Ibrahim had campaigned hard against corruption but named a graft-tainted coalition ally as a deputy in the cabinet he unveiled Friday, with analysts saying such compromises were required of a “unity government.”

The PM also named a second deputy premier for the first time in Malaysia, giving the position to his other coalition ally from the Bornean state of Sarawak.

Anwar named himself finance minister, a post he has held before, at a time when Malaysians are grappling with the rising cost of living amid a looming recession.

Announcing the appointments at a press conference, Anwar, who was sworn in last week, said the cabinet line-up reflected that of a unity government, “so in some aspects, it is adapted to embrace all the component parties.”

“The priority of the unity government is to ensure good governance and finding steps to ease the burden of the people,” Anwar said.

Anwar’s Pakatan Harapan bloc won the most seats – 82 – in the Nov. 19 election, but not a majority to be able to form the government.

To end a political impasse, the king urged the formation of a unity government, which two other blocs, Barisan Nasional and Gabungan Parti Sarawak (GPS), agreed to and joined Pakatan in a coalition government.

On Friday, Anwar announced that he had appointed Barisan leader Ahmad Zahid Hamid and GPS’s Fadillah Yusof as co-deputy prime ministers.

Barisan, which is anchored by the United Malays National Organization (UMNO), led the previous government but was routed in the general elections, winning just 30 seats in the 222-seat house. Many of Barisan’s members held chairman and UMNO president Zahid responsible for the rout and called for his head.

Zahid faces 47 criminal charges in a case related to the alleged misappropriation of a total of 52.25 million ringgit (U.S. $11.42 million) from his family-owned foundation, which was set up to help the economically disadvantaged. In that trial, Zahid is accused of using the funds to make credit card and car payments.

After Anwar was sworn in on Nov. 24, civil society organizations and some Pakatan members urged Anwar not to include any corruption-tainted MPs in his cabinet. They were clearly pointing to Zahid.

But Zahid was instrumental in persuading his coalition to ally with Anwar’s coalition, so many analysts expected he would get one of the deputy PM posts, by virtue of being Barisan’s leader.

Analyst Oh Ei Sun, of the Singapore Institute of International Affairs, said Anwar would have been on the horns of a dilemma.

“On the one hand, with Zahid saddled with criminal cases, it doesn’t look good on a government priding itself on reform,” Oh told BenarNews.

“On the other hand, Zahid is instrumental in retaining UMNO [Barisan] support for Anwar, absent which the government could collapse.”

Another observer, Tunku Mohar Mokhtar, of the International Islamic University of Malaysia, concurred.

“In the end, Anwar has to respect Barisan’s party hierarchy and the fact that Zahid is yet to be convicted. It’s a matter of political expediency,” Tunku Mohar told BenarNews.

However, many Malaysians on Twitter were unhappy at Zahid’s appointment, as was Ramon Navaratnam, the former president of Transparency International Malaysia. 

“Zahid Hamidi has become deputy PM so there’s a question of the credibility of our future policy,” Ramon told BenarNews.

“We talked about anti-corruption then we got people charged with corruption [as deputy PM]. Where is the credibility?”

Many critics had said that Zahid’s insistence on holding the general election almost a year ahead of schedule was related to his criminal trial. That is, critics believed he wanted a government that would help him in his trial.

Now that Zahid has been made deputy PM, will Anwar also feel pressed to intervene in the UMNO leader’s graft case? Analysts are divided on the issue.

Mazlan Ali, of Universiti Teknologi Malaysia, doesn’t believe Anwar will interfere in the judiciary’s work.

“Our country practices the concept of separation of powers [of the executive, legislature and judiciary],” he told BenarNews.

“So the court case of Zahid Hamidi and his appointment as deputy PM are two different things. Maybe at the end of the trial if he is found guilty, Zahid must resign from the cabinet.”

Universiti Kebangsaan Malaysia’s Salawati Mat Basir was not as upbeat as Mazlan.

“Zahid’s case is about to be dropped,” Salawati told BenarNews.

‘Most of them have experience’

At the press conference on Friday, Anwar announced a smaller cabinet, with 28 members, than the one of the previous Barisan-led government.

It is an ethnic Malay-majority cabinet, and includes five women.

Anwar’s Pakatan saw the most representation in the cabinet, with 15 ministers. Its portfolios include home, finance, economy, and health. 

Barisan was given six ministries, including deputy PM, defense, law, and foreign affairs. UMNO’s number two man, Deputy President Mohamad Hasan, was named defense minister.

GPS was also given six portfolios.

Mazlan of Universiti Teknologi Malaysia was satisfied with the cabinet line-up.

“It’s a working cabinet, small but compact. The cabinet is prepared specifically to deal with economic issues,” he said.

“The selected cabinet members have a good reputation in the work, [and] most of them have experience.”

Anwar’s appointing himself finance minister should give the market and investors’ confidence, because he has held the portfolio before – albeit 30 years ago – analysts said.

“With Anwar helming finance …, the markets should react quite positively,” said analyst Oh.

Besides, “Anwar is the only one with seven years of experience as finance minister before,” said Mazlan, of Universiti Teknologi Malaysia.

“His sense of compassion for the poor will be translated into the country’s financial and economic agenda,” Mazlan added.

Anwar was named finance minister in 1991 by then-Prime Minister Mahathir Mohamad. Anwar stayed finance minister until he was fired in 1998 for disagreeing with his boss over how to handle the economy during the Asian financial crisis. 

However, Ramon, former president of TI Malaysia, looked askance at the idea of PM also holding the finance portfolio.

“We have made the blunder of having a PM as finance minister. I thought there was a lot of public concern on the conflict of interest,” Ramon said.

“We learned the lesson from former PM Najib Razak. Finance minister has to be independent,” he added.

Najib was allegedly complicit in the 1MDB sovereign fund scandal that brought down his government in 2018. He had established 1MDB in 2009 when he served as prime minister and finance minister, saying it would benefit the Malaysian people.

More than $4.5 billion was diverted from 1MDB through fraudulent shell companies to corrupt officials and their associates, according to the U.S. Justice Department.

Najib is standing trial on 25 charges of abuse of power and money laundering connected with 2.3 billion ringgit ($551 million) that went missing from 1MDB. He could also face trials on 10 additional outstanding charges.

The former PM is already in prison, serving a 12-year sentence, in a case related to a 1MDB subsidiary.

Meanwhile, Anwar’s first task as finance minister when parliament reopens Dec. 19 will be to present the 2023 budget.

But before that he will seek a vote of confidence in parliament to prove his government’s legitimacy.

Iman Muttaqin Yusof, Fitri Hazim, Nisha David and Tengku Noor Shamsiah in Kuala Lumpur, and Nani Yusof in Washington contributed to this report.