10 August 2015

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Malaysiakini

Some 50 people gathered outside the Sungai Buloh Prison today to celebrate the 68th birthday of jailed former opposition leader Anwar Ibrahim.

Among those in attendance were Anwar’s wife and PKR president Dr Wan Azizah Wan Ismail and their five daughters.

Also present were PKR vice-presidents Tian Chua and Rafizi Ramli, and the party’s Wanita chief Zuraida Kamaruddin.

The crowd, who sang Happy Birthday and Allah Selamatkan Kamu (God save you) for Anwar from outside the prison gates, also brought three birthday cakes and a giant postcard signed by supporters.

The PKR de facto leader was on Feb 10 sentenced to five years’ jail by the Federal , which upheld his Court of Appeal conviction for sodomising his former aide Saiful Bukhari.

Critics have slammed the sentence as politically-motivated, a claim that Anwar’s family maintains till today.

Nurul Izzah Anwar said her father’s imprisonment, and the recent cabinet reshuffle that saw Umno deputy president Muhyiddin Yassin axed, are proof that Prime Minister Najib Abdul Razak is a dictator.

“It is clear that Najib is a dictator who is misusing his powers to ensure that there is no separation of powers,” Nurul Izzah, who is the MP for Lembah Pantai, said.

10 August 2015

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Malaysiakini

Former world leaders today urged the Malaysian government to release Anwar Ibrahim from jail unconditionally and immediately, in conjunction with his 68th birthday today.

The call was made, among others, by former Indonesian president Bacharuddin Jusuf Habibie, former president of Turkey Abdullah Gul and former US vice-president Al Gore.

Also making the call with them in a joint statement released today are former Philippines president Joseph Estrada, former British prime minister Gordon Brown and Tunisian Ennahdah Movement leader Sheikh Rashid al-Ghannushi.

The group believed that Anwar’s conviction and imprisonment are the outcome of an ongoing political conspiracy to end his political life and to deprive the opposition in Malaysia of its parliamentary leader.

“(We recall) that Anwar’s unjust imprisonment on Feb 10, 2015, based on politically motivated charges, has been widely condemned internationally and Amnesty International has adopted Anwar Ibrahim as a prisoner of conscience,” they said.

In a separate statement, a group of globally known activists, academicians and intellectuals declared their solidarity with Anwar and condemned the “politically motivated” charges against him.

Among the 38 signatories are Noam Chomsky (Massachusetts Institute of Technology), Tariq Ramadan (Oxford University, photo), John L Esposito (Georgetown University), Francis Fukuyama (Stanford University), Saad Eddin Ibrahim (Drew University) and British author Karen Armstrong.

“The political machinations behind Anwar’s conviction are clear as Malaysian citizens who dared to criticise the outcome have been investigated and/or charged under the country’s draconian Sedition Act.

“Many see Anwar Ibrahim’s conviction as the beginning of an intense crackdown on freedom of speech and freedom of peaceful assembly in the country.

“The crackdown, which is ongoing, has even extended to the social media. Numerous police investigations have been triggered over social media postings that are perceived to be critical of the government,” the statement by the group says.

The group went on to call on the authorities to release Anwar and uphold democracy in order for  Malaysia to continue touting itself as a democratic country.

10 August 2015

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TMI

We, the undersigned human rights organisations, stand in solidarity with Datuk Seri Anwar Ibrahim, condemn the politically motivated charges and trial that led to his imprisonment, and call for his immediate and unconditional release.

August 10, 2015 marks Anwar’s 68th birthday and 182 days spent as a prisoner of conscience. Prior to his imprisonment, Anwar was the head of Malaysia’s opposition and a prominent Muslim leader. The trial that led to his conviction was condemned as not meeting international standards for fair trials by numerous independent observers who monitored court proceedings.

Anwar’s conviction on charges of sodomy on February 10, 2015 raised serious doubts about the independence of Malaysia’s judiciary. The irregularities in the proceedings appeared to chime with a long-standing effort by the ruling coalition to disqualify him from holding political office and from fulfilling his elected role as a member of Parliament and leader of the opposition.

We also note with great concern Anwar’s deteriorating health and the difficulties he continues to face in receiving proper medical attention in Sungai Buloh prison, Selangor. Anwar’s poor detention conditions are indicative of wider problems within the Malaysian prison system.We call on the Malaysian authorities to uphold the rule of law and human rights, in particular the right to a fair trial, including by ensuring that the judiciary is completely independent from the executive branch.

We also express our grave concern over the continued crackdown on freedom of expression and political dissent in Malaysia. The ongoing arrest, detention and criminal proceedings against dozens of government critics under repressive laws, such as the 1948 Sedition Act, and the increasing harassment and censorship of independent media, represent a major setback for human rights in the country.

The rights to freedom of expression and peaceful assembly are enshrined in the Universal Declaration of Human Rights and guaranteed by Malaysia’s constitution. The continued use of repressive legislation to suppress fundamental rights is severely damaging Malaysia’s international reputation.

We therefore urge the Malaysian government to take immediate steps to repeal or amend all laws that impose unreasonable and disproportionate restrictions on the rights to freedom of expression and peaceful assembly. These laws include the 1948 Sedition Act, the 1959 Prevention of Crime Act, the 1984 Printing Presses and Publications Act, the 2012 Peaceful Assembly Act, and the 2012 Security Offences (Special Measures) Act.

Instead, human rights, including the rights to freedom of expression and peacefully assembly, should be protected by law in accordance with international human rights law and standards.

In addition, we call on the Malaysian government to repeal Article 377 of the Criminal Code and abolish sodomy as a crime. This colonial-era provision, which bans private consensual homosexual acts, is blatantly discriminatory and has no place in a modern and rights-respecting nation. United Nations (UN) human rights mechanisms have repeatedly called for a repeal of such legislation because it violates a number of key human rights, including the rights to equality and to privacy.

We firmly believe that the Malaysian government must listen to the people’s calls for reforms. Authorities must respect all human rights promote transparency and good governance and uphold the rule of law.

Amnesty International

Article 19

Asean Parliamentarians for Human Rights (APHR)

FIDH (International Federation for Human Right)

Global Bersih

Suara Rakyat Malaysia (Suaram)

10 August 2015

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TMI

Despite Pakatan Rakyat’s demise, Datuk Seri Anwar Ibrahim will still be the prime minister if the opposition manages to secure Putrajaya in the next polls, says DAP parliamentary leader Lim Kit Siang.

He said today the decision to retain Anwar as the choice for prime minister was based on the current political situation and that the former opposition leader was seen as having the ability to save Malaysia from the current crisis.

“Anwar has become the victim of persecution, he is detained (in prison) and obviously a political prisoner. It is important to have Anwar with us.

“It is vital for him to be the prime minister to uplift Malaysia, where it has never been in a very severe condition in terms of economic, politics… and the ringgit has plunged to its lowest in history,” he said in his speech during the Hari Raya open house and Anwar’s 68th birthday celebration at Sungai Buloh prison today.Lim later told The Malaysian Insider that he was confident that the decision to make Anwar prime minister would be well-received by new movement, Gerakan Harapan Baru (GHB), as it moved forward to form a new political party that rivalled PAS.

“Despite Pakatan Rakyat no longer existing, a new movement is being formed with the participation of a new political party. We believe there should be no problem with that,” he said.

On June 16, DAP announced that the seven-year coalition ceased to exist, after an irreconcilable rift between the party and former ally, PAS.

It came after PAS progressive leaders lost in the recent party’s elections, which led former deputy president Mohamad Sabu to announce the formation of GHB, the group expected to form a new alliance with DAP and PKR.

10 August 2015

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TMI

The ringgit stayed near a pre-peg 17-year low on Monday after news that Malaysia’s foreign exchange reserves fell below the US$100 billion (RM392.32 billion) threshold, raising doubts over the currency’s ability to withstand further political fallout and low commodity prices.

The ringgit stood at 3.9245 per dollar as of 0109 GMT (9.09am MYT), compared to the previous close of 3.9220.

The currency on Friday hit 3.9280, its weakest since September 2, 1998, the day before the government pegged it at 3.8000 per dollar to put a floor under the currency during the Asian financial crisis. Malaysia lifted the peg in 2005.

Malaysia’s international reserves fell to US$96.7 billion as of July 31 from US$100.5 billion on July 15, the central bank data showed on Friday.”It now becomes a question of when does the bleeding stop?” asked Stephen Innes, senior trader for FX broker Oanda in Singapore.

“No doubt BNM (Bank Negara Malaysia) will continue to sell USD to temper the move higher but at what cost can they to do so as further drops in reserves will likely accelerate the move higher.”

The central bank has been selling dollars and buying ringgit since June in an attempt to stem the ringgit’s slide, traders said, but the ringgit has still been Asia’s worst-performing currency this year, losing some 11% of its value against the US dollar.

The ringgit has been under pressure from sliding commodity prices, and its declines accelerated after a graft scandal linked to Prime Minister Datuk Seri Najib Razak and the indebted 1Malaysia Development Berhad (1MDB) state fund.

The ringgit’s weakness has hit foreigners’ appetite for local bonds, with five-year government bond yields rising to 3.856%, the highest level since January 16.

– See more at: http://www.themalaysianinsider.com/malaysia/article/ringgit-near-17-year-low-as-fx-reserves-fall-below-us100-billion#sthash.2BgcIPSZ.dpuf

10 August 2015

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TMI

A hard-hitting opinion piece by international business daily Financial Times (FT) has compared Singapore’s achievements with Malaysia’s, saying that despite the city-state’s tightly controlled society, its ruling party is largely appreciated by Singaporeans due to the success of its socio-economic policies.

In comments on Singapore’s Golden Jubilee celebrations yesterday, which marked 50 years since it separation from Malaysia, FT said the difficulties faced by Singapore “paled in comparison with those in Malaysia”.

“Not only is Malaysia going through its worst political crisis in years after hundreds of millions of dollars found their way into the bank accounts of (Datuk Seri) Najib Razak, the prime minister,” said FT, referring to allegations surrounding Najib in the 1Malaysia Development Berhad (1MDB) saga.

“More critically, Malaysia has been undergoing a long-term meltdown in which the political, religious and ethnic compact that has underpinned the country since independence groans under its own rotten contradictions,” said the paper, noting that Singapore’s per capita gross domestic product is five times that of Malaysia’s.FT said Malaysia could learn from Singapore, adding that its fight against corruption should start with Najib coming clean on the 1MDB affair, or stepping down.

Drawing comparisons between PAP and Umno, the two political parties which have dominated Singapore and Malaysia respectively since independence, FT said Singaporeans still regarded PAP as “honest and competent”, despite recent inroads by opposition parties in the republic.

On the other hand, it said the Malaysian public “senses” that Umno has long fronted a corrupt system.

But the paper acknowledged that both countries are vastly different in terms of demography, and that Singapore’s micromanagement style might not work for Malaysia.

“Still, both countries have potentially combustible ethnic mixes. Singapore has done better at forging a sense of fairness and national unity, through language, meritocracy and incorruptibility.

“Malaysia, in the name of protecting Malays through positive discrimination, has by contrast created a crony capitalist state,” said FT, calling for the dismantling of religion and race-based policies.

10 August 2015

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South China Morning Post

Would a government manipulate news of a devastating plane crash in an attempt to save its political skin?

No one is directly accusing Malaysia of doing that. But Prime Minister Najib Razak’s crisis-plagued government’s controversial statements about the Malaysia Airlines Flight 370 crash investigation make some wonder.

Three days after Razak’s middle-of-the-night announcement that a wing flap that washed ashore in the southern Indian Ocean was definitely part of the missing plane, investigators from France, the U.S., Australia and other countries have not backed up his assertion.

Things got stranger after Razak’s transport minister said Malaysian searchers found a window, seat cushions and other plane debris on the French island of Reunion and gave them to French investigators. But French officials told news agencies Friday they had not received the parts.

During the worst financial scandal in Malaysian history, the confusion surrounding the multinational flight investigation seemed, for some, to thicken the gloom enveloping this country, long a bulwark of stability and wealth in Southeast Asia.

For months, Razak’s government has been dealing with much more than the mystery over Flight 370, which went missing in March 2014 after taking off from Kuala Lumpur with 239 people aboard, most of them Chinese. All are presumed dead.

Malaysian officials have been investigating a troubled government-owned investment fund that Razak founded, known as 1MDB, which has racked up $11 billion in debt and might need a public bailout. The prime minister’s problems worsened last month after The Wall Street Journal and Sarawak Report, a British-based website, obtained leaked documents showing that nearly $700 million from entities linked to 1MDB ended up in his personal bank accounts.

Razak has not explained the source of the funds, although in the past, he has denied taking money from 1MDB for personal gain.

Some of his recent moves have appeared panicky. Authorities suspended two newspapers that reported on the scandal, and last month, Razak fired the deputy prime minister, who had publicly raised questions about the government’s handling of the matter.

This was the backdrop of the 1:45 a.m. news conference that Razak called Thursday, where he announced that the wing flap found on Reunion was definitely part of Flight 370. State-run Malaysia Airlines contacted family members of the passengers and crew, calling the news “a major breakthrough for us in resolving the disappearance of MH370.”

Relatives accused the airline and the Malaysian government of trying to close the book on the incident without definitive evidence. Malaysian authorities had already come under fire after the plane’s disappearance for a series of contradictory statements, including about the jet’s flight path, that critics say hampered the initial search.

Opposition lawmaker Liew Chin Tong called on the transportation minister to explain “the haste and hurry” to declare that the wreckage belonged to Flight 370.

Malaysia, a Muslim-majority country of 30 million, is not used to crisis. Its people are better educated and wealthier than most of their neighbours, and it has been ruled since independence in 1957 by one party, the United Malays National Organisation.

But this year, the most prominent opposition leader, Anwar Ibrahim, was jailed on sodomy charges that many say were politically motivated. Dozens of other politicians, human rights advocates and journalists have since been detained.

Malaysia also faced scrutiny after winning a slight upgrade last month in the State Department’s annual global report on human trafficking – despite the discovery earlier this year of mass graves near the Thai border that were believed to contain the remains of Rohingya Muslims fleeing persecution in Myanmar.

Malaysia has long been criticised for its policies toward Asian migrants, and human rights groups questioned whether the Obama administration did the government a favor to secure its participation in a U.S.-backed regional trade agreement.

In Kuala Lumpur last week for a summit of Southeast Asian countries, Secretary of State John Kerry defended the upgrade, saying Malaysia “has made significant efforts to comply with the minimum standards” on fighting human trafficking.

All this is overshadowed domestically, however, by 1MDB, which comes as Malaysia’s oil-dependent currency slides to its lowest value in nearly two decades and the cost of living rises sharply. The prospect that the government will have to bail out 1MDB – and that the country’s top leaders may have gotten rich while ordinary people suffer – have deepened the sense of crisis.

10 August 2015

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Forbes

Malaysian Prime Minister Najib Razak broke a cardinal rule in politics. He inadvertently admitted ‘guilt’ when the Malaysian Anti-corruption Commission cleared him of any wrongdoing in accepting a political donation. His position – vulnerable since his ascent to premiership – is no longer tenable as Malaysians question his sincerity and trustworthiness.

On 2 July 2015, the Wall Street Journal alleged that $700 million had gone into a personal bank account of Razak’s. The Prime Minister offered a non-denial denial:

Let me be very clear: I have never taken funds for personal gain as alleged by my political opponents – whether from 1MDB, SRC International or other entities, as these companies have confirmed.

Razak also labelled the report a political sabotage and threatened to sue the Wall Street Journal (more than a month after the allegation was made, at the time of publishing this article, the Prime Minister has yet to sue).

As the noose tightened around his neck, Razak went for broke.

On 20 July 2015, the Sarawak Report, a blog that had been systematically publishing reports on corruption and abuse of power in Malaysia was blocked by ‘the government’. An arrest warrant for its founder-editor, Clare Rewcastle-Brown, was subsequently issued.

On 24 July 2015, ‘the government’ announced that The Edge Financial Daily and The Edge Weekly that had been reporting extensively on the 1MDB issue were to be suspended for three months.

On 28 July 2015, the prime minister sacked his deputy and four other ministers in a cabinet reshuffle in an effort to strengthen his control of the government and the United Malays National Organisation (UMNO). With the cabinet reshuffle, Razak also neutralized the Parliamentary Public Accounts Committee that had been vigorously investigating the 1MDB affair. He also removed the attorney-general, who as part of a high-level task force (involving the Attorney General’s Chambers, the Central Bank of Malaysia, the Malaysian Anti-Corruption Commission (MACC) and the Royal Malaysian Police) was believed to have been preparing to charge the prime minister for corruption.

After pulling off this brazen act skilfully, the Prime Minister blinked.

On 3 August 2015, the ‘MACC’ announced that the $700 million channeled into Razak’s personal bank account came from donors. In doing this, Razak inadvertently confirmed the Wall Street Journal’s report and opened Pandora’s Box.

This admission of ‘guilt’ has taken the toxicity of the Prime Minister to an all-time high. More damaging than the legality of the matter (i.e. was it corrupt for Razak to solicit donations on behalf of UMNO; is it certain that the donations were for UMNO; who donated; what were the donations for; were the donations used at the 2013 general elections; did the donation break Malaysian laws; etc) is the question of trust and legitimacy.

Malaysians will now once again question Razak’s honesty and sincerity in denying all other allegations made against him, his family and his administration. After all, if the Wall Street Journal’s  preposterous allegation is correct, could all other preposterous allegations be true?

Malaysians will begin to wonder if there is truth to the preposterous allegations made by the suspended The Edge Finance Daily and The Edge Weekly.

Malaysians will begin to wonder if there is truth to the numerous preposterous allegations made by the blocked Sarawak Report.

Malaysians will begin to wonder if there is truth to the many preposterous allegations on 1MDB made by members of the opposition.

Malaysians may also begin to wonder if there is truth to all other preposterous allegations made about the Prime Minister, his wife and his family.

Malaysians will begin to wonder if there is truth to the preposterous claims being made by Bersih 2.0, namely that elections are neither free nor fair in Malaysia.

UMNO members will begin to wonder if there is truth to the sacked Deputy Prime Minister Tan Sri Muhyddin’s preposterous premonitions about UMNO’s future.

Having realised this faux pas, the Prime Minister and UMNO are currently engaged in rear-guard action to correct the mistake. But for an embattled Prime Minister already suffering serious trust and legitimacy deficit, this may be too late.

One should not however dismiss Razak outright. It goes without saying that a dead man walking can be very unpredictable and dangerous.

Note: It appears that ‘the government’ and its ‘agencies’ (e.g. the Attorney General’s Office, the MACC, the Central Bank) are divided on 1MDB. It appears that some are aligned to protecting the Prime Minister, others intent on removing him, and some who are just doing their work. I discuss this in next week’s article.

7 August 2015

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The New York Times

Malaysia’s handling of the discovery of a wing part that apparently came from the missing Malaysia Airlines Flight 370 has worsened frictions with its partners in the investigation, rekindled frustrations among the families of people who were aboard the plane and further dented the country’s battered credibility.

Many questioned the timing and motives of the Malaysian prime minister, Najib Razak, who announced in the early hours of Thursday that the wing part had been “conclusively confirmed” to be from the missing plane. He spoke just before a news conference in Paris at which French investigators were much more guarded, saying only that the experts had “very strong presumptions” that the part came from the plane, a Boeing 777.

Later on Thursday the Malaysian transportation minister, Liow Tiong Lai, clouded the picture further when he told reporters in Kuala Lumpur that a Malaysian team had found more aircraft debris on the French island of Réunion, where the wing part was discovered last week. The French authorities in Paris denied that any new aircraft debris had been found.

The discrepancies between the Malaysian declarations and what others involved in the investigation, including experts from Boeing, were prepared to conclude about the evidence have created significant tensions between Malaysian and French officials, according to a person close to the investigation.

Mr. Najib has domestic political worries, not least a scandal swirling around a troubled state investment fund that has put him under intense scrutiny. The Wall Street Journal and The Sarawak Report, a website based in Britain, have reported that documents found by investigators in Malaysia indicate that almost $700 million was transferred to accounts that Mr. Najib is believed to control.

In late July, Mr. Najib dismissed his deputy prime minister, who had publicly called on him to give a full account of the matter, and the country’s attorney general, who was one of the leaders of the investigation into the scandal.

But exasperation with the Malaysian authorities dates to when the plane first disappeared, on a night flight from Kuala Lumpur bound for Beijing in the early hours of March 8, 2014. Ground controllers lost contact with the plane about 40 minutes after takeoff, but the authorities did not issue an alert about the missing plane for hours.

Then, Malaysia spent a full week directing a major search-and-rescue effort focused on the Gulf of Thailand, along the plane’s scheduled flight path, even though the Malaysian military had tracked an unidentified aircraft flying in nearly the opposite direction — westward and out into the Indian Ocean — which investigators later concluded was Flight 370.

Eventually, based on the radar data and automated satellite signals received from the jet, investigators concluded that it had flown on for hours more, and probably ran out of fuel and crashed in the Indian Ocean west or southwest of Australia. Searchers began working from the air, and later scanning the deep ocean floor with sonar devices, but nothing has been found there.

The wing part was the first tangible trace of the plane to turn up.

For many people who had loved ones aboard Flight 370, the identification, or near-identification, of the object only intensified their desire to know how and why the jet had veered off course and flown unnoticed into remote ocean waters.

Chinese citizens made up about two-thirds of the 239 people on the plane, and in Beijing, relatives of the victims viewed Mr. Najib’s announcement with skepticism or outright disbelief.

On Thursday morning, about 20 relatives gathered outside the Malaysia Airlines office in Beijing, demanding to talk to airline representatives and to be flown to Réunion. More than two dozen police officers kept them from entering the office building.

“We don’t accept this; this is not closure,” said Dai Shuqing, who had five relatives on the plane, including her sister. “The Malaysians want to lie to the whole world, but they cannot lie to us. We will persevere and keep digging.”

Others outside the airline’s office held signs with slogans such as “Malaysia hides the truth.” Later in the day, some of the relatives moved the demonstration to Boeing’s offices in the city.

Under international aviation conventions, Malaysia is leading the overall Flight 370 investigation because the aircraft was registered in Malaysia and took off from Kuala Lumpur. The ocean search is being led by Australia, whose ports are nearest the search area. But the wing part found on Réunion is being examined at a laboratory near Toulouse, France, because it washed ashore on French territory. The Paris prosecutor’s office has opened an inquiry into the crash because four French citizens were aboard the flight.

Though Malaysian officials appeared eager to reach conclusions swiftly and put the mystery of Flight 370 behind them, Tony Abbott, the Australian prime minister, said Thursday that the ocean search would continue. “We owe it to the hundreds of millions of people who use our skies,” he said.

Meanwhile, Jean-Paul Virapoullé, the mayor of St.-André, Réunion, near where the wing debris was found, said Thursday that his town would organize a “meticulous search” of the beaches there next week.

“If it can soothe the terrible pain of these hundreds of families, the city of St.-André, with the agreement of the relevant international authorities, is ready to erect a memorial for the people who are missing,” the mayor said in the statement.

The person close to the investigation said that volunteers on Réunion turned in some additional debris to French aviation officials on the island on Thursday, but that a preliminary evaluation indicated that none of the objects were from a plane.

Still, David Griffin, an Australian scientist who has mapped ocean currents in the area, said Thursday that he believed more debris from Flight 370 could wash up on Madagascar, the much larger island nation to the west of Réunion.

“There could be a very large amount of debris floating, or a very small amount,” said Mr. Griffin, who is with the Commonwealth Scientific and Industrial Research Organization in Australia. “I am slightly surprised that something turned up at Réunion, rather than Madagascar, because Madagascar is so much bigger.”

Wen Wancheng, 63, whose son was on the aircraft, said finding one wing part did not resolve the mystery of Flight 370.

“The sort of closure the families want is to know what exactly happened to the plane, and have the bodies returned,” he said by telephone from Jinan, in eastern China.

That sentiment was shared by other relatives of Flight 370 victims around the world, some of whom said that the discovery of the wing part, known as a flaperon, only intensified the mystery.

“Ultimately in the end for the families to have a sort of closure, we need to know why it ended up in the ocean, what happened,” Sara Weeks, whose brother Paul was a passenger, said in an interview with Australian radio from Christchurch, New Zealand. “It is really important for everyone because if that plane can go missing, another one can.”

For some, the longing for more evidence has only grown stronger.

“It’s a piece of flaperon; it’s not my husband,” said Jacquita Gonzales, the wife of a Flight 370 crew member, Patrick Gomes. Ms. Gonzales was one of a small group of family members who spoke to reporters on Thursday in the Malaysian city of Petaling Jaya.

“Although they found something, it’s not the end,” she added. “They still need to find the whole plane and our spouses as well. We still want them back.”

7 August 2015

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Bloomberg

International investors are selling Malaysian stocks at the quickest pace in Asia as Prime Minister Najib Razak struggles to contain a political scandal and doubts grow over the outlook for the economy.

Foreign funds have pulled a net 11.7 billion ringgit ($3 billion) of the nation’s shares this year as the benchmark FTSE Bursa Malaysia KLCI Index retreated 4.6 percent. The ringgit has slumped to its weakest since 1998 after tumbling 11 percent against the dollar, the biggest decline among Asian currencies.

Overseas money managers are withdrawing funds amid concern the crisis will distract Najib as a commodities rout and the prospect of higher U.S. interest rates threaten economic growth. The prime minister is fighting off a scandal linked to 1Malaysia Development Bhd., a debt-ridden state investment company. A probe into about 2.6 billion ringgit that was deposited into Najib’s personal accounts found that the funds were legal donations from the Middle East.

“Already shaky trust of foreign investors is being eroded,” said Mixo Das, a strategist at Nomura Holdings Inc. in Singapore. “Further outflows are possible.”

Net foreign sales in Malaysian stocks this year are almost double the 6.9 billion ringgit for the whole of 2014, exchange data show. Overseas investors have been net sellers for 14 straight weeks through the week ended July 31, the longest selloff since 2008, according to MIDF Amanah Investment Bank Bhd.

International ownership of government and corporate debt dropped 2.4 percent in July to 206.8 billion ringgit, the least since August 2012, the central bank reported on Friday.

Rising Volatility

The KLCI has slumped 9.8 percent from its April 21 high, including a 1.8 percent decline on Thursday that was the biggest this year. The gauge lost 0.8 percent at 4:35 p.m. in Kuala Lumpur on Friday. The ringgit dropped 0.3 percent, taking its weekly decline to 2.4 percent. That would be the biggest slump in eight months.

Volatility is increasing, with a gauge of 30-day price swings rising to its highest level in six months. The stock measure trades at 15.2 times projected 12-month earnings, or about 10 percent higher than the MSCI Southeast Asia Index.

The Wall Street Journal reported on July 3 that $700 million may have moved through government agencies and state-linked companies to accounts bearing Najib’s name. The premier has denied taking money for personal gain and has described the furor as part of a campaign to remove him from office.

The Malaysian Anti-Corruption Commission said it won’t disclose the identities of the donors to Najib and plans to question him to seek an explanation on the funds.

Stability Threatened

For Aberdeen Asset Management Sdn.’s Gerald Ambrose, the political crisis means Malaysia risks losing its status as a safe haven in the region.

The ruling National Front coalition has dominated power since the country gained independence in 1957. Neighboring Thailand is under military rule after a coup, while in Indonesia, President Joko Widodo is struggling to push through policies following the closest election in more than a decade.

“Long-term political stability has long been one of Malaysia’s trump cards, but it’s not so easy to say that nowadays,” said Ambrose, who oversees about $3.6 billion as managing director of Aberdeen Asset Management in Kuala Lumpur. “Uncertainties surrounding 1MDB and the quite public political spat has clearly not helped foreign investors’ sentiment towards the country.”

Minister Sacked

Najib chairs the advisory board of 1MDB and has resisted calls from ex-premier Mahathir Mohamad to quit over the fund’s performance as it amassed about 42 billion ringgit of debt in less than five years. Najib on July 28 sacked his deputy prime minister Muhyiddin Yassin, who had called for answers on the 1MDB imbroglio including its investment decisions.

Franklin Templeton Investment is sticking with its investments in the nation’s stocks.

“We actually stayed in and we will continue to stay in,” Mark Mobius, chairman of the emerging markets group at Franklin Templeton Investment, said by phone from Singapore. “We are still finding opportunities in that market and particularly when there are concerns there, you can see some possibilities.”

Foreign outflows may accelerate if the political scandal prevents the government from tackling the issues affecting the economy, says Alan Richardson, a Hong Kong-based money manager at Samsung Asset Management, which oversees about $112 billion.

Growth Concern

Malaysia’s foreign-exchange reserves have dropped to the lowest level since the 2008 global credit crunch, reducing ammunition to shore up the currency. A plunge in Brent crude is cutting revenue for Asia’s only major net oil exporter, while the Federal Reserve is mulling its first increase since 2006 as soon as next month.

The government forecasts the economy will expand 4.5 percent to 5.5 percent this year, down from its earlier projection of as much as 6 percent. Earnings at companies on the KLCI are projected to grow 11 percent in the next 12 months, data compiled by Bloomberg show. That compares with a 41 percent gain in Thailand and an increase of 82 percent in Indonesia.

“Investors are worried,” said Richardson, who has been underweight Malaysian equities since November. Stocks in the nation would only start to look attractive “if some of the adverse developments” are resolved, he said.

7 August 2015

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Malaysiakini

US Secretary of State John Kerry said he raised the issue of former opposition leader Anwar Ibrahim in his talk with Prime Minister Najib Abdul Razak.

Kerry, who is in Malaysia for a two-day visit to attend the Asean meetings, had bilateral talks with Najib and Anifah yesterday.

“I raised concerns about freedom of expression and I spoke to the prime minister about Anwar Ibrahim’s situation (in the bilateral talks),” he said at a press conference in Kuala Lumpur today.

Kerry did not elaborate on how the discussions about freedom of expression and Anwar went.

On Feb 10, Anwar was convicted of sodomising a former aide and is currently serving a five-year jail sentence in Sungai Buloh prison.

However, opposition supporters and human rights groups have criticised the verdict, saying the proceedings were politically motivated.

Last week, British Prime Minister David Cameron also spoke to Najib about the treatment of Anwar during his visit to Malaysia.
British newspaper The Telegraph had reported that Cameron also challenged his Malaysian counterpart to clean up his government, in reference to allegations that RM2.6 billion had been deposited into the PM’s personal accounts, as well as other issues plaguing 1MDB.
Anwar’s conviction received a chorus of criticisms and concerns from various governments, including the US.
The jailed politician, declared a “prisoner of conscience” by global human rights organisation Amnesty International, had also been facing increasingly serious health problems while in jail.

In December last year, before the apex court verdict, US vice-precident Joe Biden (photo) tweeted on Malaysia’s use of sedition to silence opposition, but expressed hope that the government would make things right through Anwar’s case.

“Anwar’s appeal gives Malaysia a vital chance to make things right and promote confidence in its democracy and judiciary,” Biden added then.

7 August 2015

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Former opposition leader Datuk Seri Anwar Ibrahim has urged Datuk Seri Najib Razak to stop intimidating investigators probing into the 1Malaysia Development Berhad (1MDB) controversy.

In a statement from prison released through his lawyer R. Sivarasa, Anwar said there were indications that the Malaysian Anti-Corruption Commission (MACC) and Bank Negara Malaysia (BNM)  were being threatened.

“I call upon Prime Minister Najib to cease all acts of interference and intimidation of public officers of our key investigatory and regulatory agencies.

“I refer in particular to the recent use of PDRM officers to arrest, interrogate and even remand persons involved with the Malaysian Anti-Corruption Commission, including those directly investigating how RM42 million from SRC International ended up in Najib’s personal accounts at Ambank,” he said in the statement.The PKR de facto leader also urged Malaysians to rally behind MACC and Bank Negara to protect them from facing intimidation in their investigations.

He said these institutions must be “saved” from political disturbances.

“I urge all the people, NGOs, politicians and civil society to set aside their differences and unite to save the country from the economic and political crisis we are going through,” he said.

Recently, the police conducted a series of raids and arrested MACC officers over alleged leaks in the 1MDB probe.

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