How will Najib’s China card play out

November 8, 2016

Q: Quickest answer that you can possibly manage – did Najib pull off a success in China?

A: Yes. There were many goodies – you’ve got to understand Najib is like a man with only two caps trying to stop water from coming out from ten holes – so before the China trip he was really like one of those contortionist using his body parts and only two caps to stop the water from rising above his neckline.

Now for the short term at least – he’s managed to plug the 1MDB hole with the new east coast rail line. That’s a big hole that he no longer needs to worry about. As potentially the 1MDB financial fallout would have been bigger than even the scandal itself. Now it’s sorted.

Q: What’s so important about the east coast rail line in Malaysia?

A: I’ll get to that. But first let me completely answer your question. The second thing that he has done is to send a very clear message to whoever gets elected as the President – hey, you better pick up the phone and get the attorney general in the department of justice to cut me and my tribe some slack. As by agreeing to buy Chinese frigates – he’s sending out a clear message to the Americans. He’s considering realigning Malaysia with China.

The third benefit is the rail line will revivify the much neglected East Coast of Malaysia. This is important as unlike the West coast which enjoys steady precipitation thru out the year – the east is really quite the direct opposite of optimal agricultural land. The easterly monsoon usually floods huge swathes of land – but the most important thing for Najib is this greatly enhances his prestige in the East. This is important as Najib’s political crèche is in the state of Pahang. The rail line will generate a lot of jobs for a sustained period throughout the whole vein to East to South.

Right now the east is just a top heavy tourist site with patches of padi fields – and since much of the East line will run thru PAS controlled territory – he can use that as crowbar to align UMNO further with the oppositional PAS.

Q: How important is PAS to UMNO to win the next general elections?

A: This is a fact in Malaysian social life and politics. Religion in the form of Islam is assuming an increasingly prominent role than ever as a galvanizing force along with garnering Malay votes especially in the kampungs (countryside) – it’s effects are mild and hardly registered at all in the city. But this is the new reality outside cityscape – Arabification is becoming a fact of life. Why is this occurring is a topic best left for another post. But this reality cannot be denied even by the apparatchiks of UMNO. To win significant swathes in the mainland – UMNO needs to secure votes in the rice belts of a Kedah and Kelantan to counterbalance the political shift to the South that is moving to the opposition – this can only be accomplished if UMNO collaborates with PAS.

Q: How is the China deal perceived by most Malaysians?

A: That is perhaps the most perceptive and intelligent question you have ever asked me since starting this interview series – I will speak plainly to be accurate in my personal assessment. The ultra Malay nationalist within and outside UMNO are suspicious of anything Chinese – the see a secret agenda furiously and mysteriously at work. Real or imagined is not the issue – they see it purely along racial lines. And this is quite normal in Malaysian politics as race and religion have always been set pieces – even Mahathir’s new opposition Pribumi party is streamed along racial lines to appeal to the Malay majority and specifically exclude the Chinese and Indians.

There is always the fear that China will be able to exert such a strong gravity as to be able to influence the domestic politics of Malaysia simply because there are Chinese in Malaysia – that fear has always been there historically since the days of Malayan Emergency when the Communist party was around – Najib’s recent visit to China merely stirred the sediments of history. No doubt about that – the opposition with play this up and it remains to be seen how Najib will deflect these anxieties.

Q: How well do you think Najib will perform in being able to balance the economic benefits of aligning itself with China while at the same thing soothing fears and concerns of the ultra Malay nationalist?

A: UMNO has a very well organized oligarchy from top right down to the grassroots – you don’t see this in the cities, because it’s too big. But in the kampung’s this is reality. Because communal ties are still very strong and voters still cast their votes based on communal lines.

He has to be able to demonstrate plus points – and plus points are plus points. I give you a simple example. Price of oil palm has gone up recently. Why? Because China has agreed to buy on a sustained basis, so it’s likely to stay up – kampung economy is very oil palmcentric. This is especially so after El Niño. As it has ravaged the micro kampung economy in so many ways that agricultural and livestock production will be riven with systematic complications for at least two possibly three years. This is not a period of growth. It’s a time to recover from the damage – and the lean times are not truly over yet. La Niña is expected to follow soon. So it’s a double whammy – but if the price of oil palm stays above $500 for class C many kampung folk will be more than happy to look the other way. As despite the low yield, the relative high price of commodities will make up for the shortfall – he needs to keep repeating the message – life will get better. Money can accomplish this. As it doesn’t smell no matter who or where it comes from. At the subsistence level of micro kampung economy especially the Felda small holders who number into the hundreds of thousands and run thru out the state of Perak right down to the south in Johor – this is very important. Because yield will go down significantly next year.

As for BN incurring major loses in the cities. That’s already factored into their calculations – but if the kampungs economy collapses, it’s game over for BN. If it’s holding up on the one leg of oil palm – BN will win quite comfortably with plenty of reserves to spare.

The way I see politics it’s very prosaic – if a harvester can’t even feed his family or service his loans to pay off his Honda scooter – then politicians can say anything they want but it will and can only go so far.

So this move by Najib to secure sustained Chinese oil palm imports is in relative terms the most important take away – as unlike the rail project that has a long gestation period before benefits can percolate down to the common man – this is like a shot of steroids. Bang! It’s effects are instantaneous and potent.

Having said that the opposition will certainly continue to sow the seeds of doubt by heightening the racial aspects of this deal along with possible compromise to sovereignty and even suggesting that the SCS has been flogged off without a fight.

I was quite surprised Najib unlike Duterte did not gain anything concrete from the Chinese concerning the SCS – as even a token assurance by the Chinese would have been enough to deflect the opposition from capitalizing on the geo political rammifications of this deal.

In my opinion that is a very serious omission as it looks as if he sold off Alaska in exchange for short term benefits. This will come back and bite him.

The bright side is an emotional appeal to the memory of his father’s move to connect with China – because Razak had a Nixon moment with the Chinese. So he can certainly leverage on that piece of history to create a narrative that this is just a continuation of realpolitik by other means.

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