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Could Malaysia’s Political Feuds Let the 1MDB Scandal’s Architect Through the Cracks?

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From gifting Basquiat paintings to Leonardo di Caprio to pouring millions of dollars in champagne over himself and Paris Hilton, allegations of outrageous exploits and profligate spending surrounding fugitive Malaysian financier Jho Low are being read about across the globe—but not in the UK.

That is because Low’s lawyers have used Britain’s notoriously strict libel laws to effectively muzzle Billion Dollar Whale, a new book from investigative journalists Tom Wright and Bradley Hope that describes the playboy banker’s alleged role in siphoning off more than $4 billion from Malaysian sovereign investment fund 1MDB. Even though the book was released amid critical praise on September 18th, anyone in the UK will be hard-pressed to find a copy in their local independent bookstore— or even on the UK websites of Amazon, Waterstones, or WH Smiths. Not a single UK-based publisher agreed to take on the book due to fears over libel suits.

The Guardian published an expose this week detailing the efforts of London-based law firm Schillings to suppress the book’s sale in Britain. Low’s lawyers have tried to head off the book’s distribution by sending intimidating letters threatening to sue booksellers across the world. Outside of the UK, however, this legal campaign has failed to curb the book’s launch. The Australian owner of Boomerang Books, for example, simply rejected the threat as lawyers “blowing smoke“ and refused to take the book off shelves.

While his attorneys threaten booksellers, Low has also launched a website proclaiming his innocence and disputing allegations of his involvement in corruption, going so far as to claim his astounding wealth—at one point, Low may have had access to more liquid cash than anyone in history—comes from inheritance. A staggering inheritance is less likely than Billion Dollar Whale’s assertion that Low managed to get Goldman Sachs to transfer $3 billion of Malaysian state funds into a private Swiss bank account. Low allegedly used the stolen money to, among other things, bankroll the film Wolf of Wall Street and purchase a $250 million superyacht.

Low’s alleged role as mastermind in the 1MDB scandal may be the focus of Billion Dollar Whale, but nonagenarian prime minister Mahathir Mohamed has instead zeroed in on predecessor and onetime protégé Najib Razak. Last week, Najib’s lawyer Muhammad Shafee was detained on money laundering charges. Najib himself was then arrested on September 19th and is now awaiting trial on more than 20 counts, with anticorruption agency officials hinting at more charges still to come.

The 93-year-old Mahathir has previously stated that he has the “almost perfect case” to convict his disciple-turned-enemy. As Mahathir’s young government has moved against them, however, Najib and Shafee have pushed back. Najib has repeatedly insisted that he believes Mahathir’s focus on his role in the corruption scandal is politically motivated. He also claims the $681 million bank deposit at the heart of the money laundering accusations against him was a donation from the Saudi royal family, an assertion the Saudi government backed in 2016. Shafee revisited the details of the funds transfer this week following Najib’s arrest, pointing out that the former PM returned the vast majority of the $681 million and disputing the money laundering charges against his client as “illogical.”

While Mahathir doggedly pursues Najib, he seems to be making less of an effort to pursue or apprehend Jho Low and the billions the financier allegedly pilfered. Why the discrepancy? The answer likely lies in Mahathir’s own past as a member of the same class of strongman as the Philippine’s Ferdinand Marcos and Indonesia’s Suharto, as well as his personal history with Najib.

Mahathir may have only come to power in May, but he has already served a nearly two-decade term as Prime Minister that earned him an international reputation for ugly ethnic politics and strongarm tactics. He ushered in the “Malaysia Inc.” policy that tried to follow the Japanese model of nationalizing certain industries, but is best known for the failed nationalization of the automotive industry and the Malaysia-produced Proton car. He is also known for throwing another potential successor, Anwar Ibrahim, out of power and into prison on sodomy charges suspected to be politically motivated.

Ironically enough, Mahathir retook power this year by campaigning on the return of rule of law and an end to corruption – and is once again pointing to Anwar as his anointed successor. More than a few observers suspect Mahathir’s aspirations to return to office were born less out of any interest in saving his country, and more from a desire to wreak political vengeance on his former ally. Najib, who came to power in 2009, oversaw the reversal of many of Mahathir’s policies. Steps such as rolling back import tariffs on automobiles to the detriment of the Malaysian Proton led Mahathir to perceive Najib as undoing his political legacy.

With this personal animus playing out in the Malaysian press over the past few years, Mahathir’s current persecution of Najib risks crossing the line separating a fair judicial process from the jailing of a political rival. Asian affairs analysts have raised the specter of Mahathir using Najib as a scapegoat to avoid genuine reform. It was, after all, under Mahathir’s previous tenure that shady backroom dealings and authoritarian behavior became the norm in Malaysia.

With that track record, it certainly seems illogical to hope the man most emblematic of Malaysia’s old guard will steer the country back towards democracy after finishing with Najib. Mahathir will allegedly hand off power after two years per the terms of his agreement with Anwar Ibrahim. Two years is a long time in the context of Malaysia’s unpredictable politics and the rumblings of discontent with the arrangement within the ruling coalition.

In the interim, the new government’s single-minded focus on Najib could help Jho Low fly as low under the radar in Malaysia as he has in the UK.

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Southeast Asia

Indonesia: Balanced politics amid major powers

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In 2020, Russia and Indonesia will mark 70 years to the establishment of  diplomatic relations between the two countries. Given that the epicenter of the geopolitical activity is currently shifting towards the Asia-Pacific Region (APR), the role of Indonesia as the planet’s strategically important location increases.

Along with Russia, there are a number of other countries that are as keen on developing ties with Indonesia. One of them is Australia, which is particularly active due to its geographical location.

Indonesia and Australia boast a comprehensive bilateral strategic partnership agreement, which defines them as “strategic anchors of the Indo-Pacific Region”. According to tradition, each newly elected Australian Prime Minister pays his first foreign visit to Indonesia. Prime Minister Scott Morrison, who took office on August 24, 2018, kept the tradition as well.

In Jakarta, Morrison met with Indonesian partners to discuss the details of a strategic cooperation agreement, which envisages economic cooperation, security measures, exploitation of marine resources, ensuring stability in the Indo-Pacific Region and social projects.

According to the Jakarta Maritime Policy Strategy (Global Maritime Fulcrum), Indonesia is regarded as the fulcrum between the Indian and the Pacific. Canberra also sees Jakarta as key to Australia’s defense strategy.

Indonesia’s territory embraces most of the archipelagoes north of Australia and these make a convenient springboard for a hypothetical threat to the Australian coast. In addition, Indonesia stands at the junction of marine and air routes from Australia to Europe and from Australia to Asia-Pacific countries. Joint naval exercises run by the Indonesian and Australian defense ministries account for 24% of the total, while 33% of the drills are held by the Air Forces, 30% by special services and special task forces, and 2% by the peacekeeping contingents.

Australia became the third country with which Jakarta signed a comprehensive strategic cooperation agreement after the United States (2013) and China (2015). In 2017, the two parties signed the Joint Declaration on Maritime Cooperation, in 2018 – the Maritime Cooperation Action Plan, covering 85 areas with the participation of 17 Australian and 20 Indonesian departments and agencies.

Australia finds Indonesia more important than Indonesia finds Australia. As a single continent, Australia attaches particular importance to foreign policy with a view to ensure its national security. As for Indonesia, it has a more introverted policy. Being the largest island nation on the planet, Jakarta aims to guarantee its security through internal consolidation of the many islands that make up the Indonesian state.

Pursuing the policy of “non-alignment”, Indonesia seeks to diversify foreign economic and foreign policy relations. This becomes clear from the previous development of the Indonesian-Australian relations: Jakarta would quickly freeze projects with Canberra once it spotted a disproportionate presence of Australia in Indonesian politics.

That was the case in 1999 when Jakarta withdrew from the Security Agreement, signed in 1995, in 2013 when it suspended defense cooperation and cooperation between special services, and 2016 when it suspended the language training of military personnel.

For Indonesia, a multi-vector foreign policy is crucial for maintaining a healthy balance of power in the region. For this reason, Moscow is an attractive economic partner for Jakarta. That Russian-Indonesian contacts have been developing at fast pace can be concluded from the fact that there have been several meetings between the two countries’ presidents, that Russia has been supplying Indonesia with weapons, that the two countries’ armed forces have held joint exercises, that Indonesian representatives have participated in business forums in Russia and that the Russian capital has revealed in interest in Indonesia’s projects in the mining industry.

Jakarta and Moscow are considering prospects for the introduction of a free trade zone in Indonesia and the EEU. Indonesia is also ready to join the Chinese global infrastructure project “One Belt, One Road.”

Under the project, Chinese investments in the Indonesian transport infrastructure amount to $ 6 billion, which is clearly not enough for a rapid growth of transit of commodities and haulages from China and the Asia-Pacific countries through Indonesia. Indonesia’s medium-term economic development plan stipulates local financing at 63% (4). The rest should come from foreign investors, which could include Russia.

First published in our partner International Affairs

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Southeast Asia

Improving Vocational Education in Thailand: An interview with Khunying Sumonta Promboon

Rattana Lao

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Her Royal Highness Princess Maha Chakri Sirindhorn visited Chitlarada Technology College with a welcome by Associate Professor Khunying Sumonta Promboon, the President of Chitralada Technology College

Bangkok – When robots are advancing and industries are playing catch up to technological advancement, vocational education plays a pivotal role in national development. Instead of arcane theory, vocational education trains students with sophisticated, hands on and practical skills needed to excel in the world of work. Vocational training offers an up to date and cutting edged techniques for students not only comply but push technical boundaries forward. Countries that excel in their industrialization all champion vocational education – Germany, China and Taiwan to name but a few.

Thailand, despite setting its eyes for Thailand 4.0 to transform its economy to digitalization, automation and robotics, is falling behind the race to the top. The World Bank found that 40% of the top tier international firms reported the inadequate skills as the major constraint. While the country is in much needed position for vocational education, there are only 1 million students in vocational school comparing to 2.5 millions in higher education. Although the country has more than 900 vocational colleges, students opt for higher education because better images and prestigious. When news about vocational education in Thailand are filled with images of violent students and gang fights amongst students, there is a dire need to reform this important sector. Rattana Lao, Program Officer in Policy and Research at the Asia Foundation, talked to Associate Professor Khunying Sumonta Promboon, the President of Chitralada Technology College on ways in which Thailand vocational education can reform itself to better respond to national demand: One step at a time.

What role should vocational education play in Thailand?

Vocational education should be the main educational track to educate and encourage young students to partake in the national development of the country. After receiving basic education of grade 1 to 9, the majority of students should enroll in vocational education. However, the case of Thailand is different. The majority of Thai students like to enroll in basic education of grade 10 to 12 and continue to enroll in universities rather than vocational education.

How can one promote vocational education?

Many factors need to be taken into account in order to incentivize more students to enroll in vocational education.

Firstly, students need to have guaranteed employment. Such employment should begin when they are still students, an internship of some sorts. This requires a close collaboration between educational institutes and corporates. A symbiosis between the two stakeholders is necessary. This is not widespread in Thailand. The opportunities are still inadequate and limited to a few top students in colleges rather than available equally to all students.

Secondly, the social attitude must change. In Thailand, parents want their children attend higher education and receive bachelor degrees, master degrees and PhD. To change this attitude, it will take time. It goes back to the first point that students need secure employment.

We incorporated these ideas into the creation of Chitralada Technology College. We want to take lead in enabling students who take vocational education with us being able to transfer into higher education later on– making the opportunities for education and employment aligned.

What are the problems of vocational education in Thailand?

The first problem is the social bias. People prefer basic education because its more prestigious. The second problem is students do not know the diversity of career paths. They know only limited choices of teachers, soldiers and doctors. The educational counselling in Thailand needs an improvement.

What does Chitralada Technology College try to do?

There are two institutes within the same umbrella. The first is Chitralada Vocational School and the second is Chitralada Technology College. There are total number of 800 students in these two institutes. Although we are small in sizes, we would like to lead best practices in term of vocational educational practices. There are many programs that we offer for students.

What is your strategy to promote vocational education in Thailand that is different from others?

We have extensive networks of 67 businesses throughout Thailand as well as partnered with other organizations. In total, we have MOUs with more than 80 institutions. We partnered with Singapore, China and Germany.

Can you give examples?

With China, we partnered with Leshan Vocational Technical College. They accept our students’ exchanges for culinary school. There is also Tienjin Sino-German Vocational Technical College that we partner about mechatronics. With Singapore, we work with Singapore Polytechnique. We are beginning to initiate exchanging programs with Temasek and Singapore Polytechnique. Last year, we took Singapore students to Sumutsongkarm to visit local communities who produce shrimp pastes. It’s impressive idea they are creating. There is also Senior Expert Project we partner with Germany. Mostly it is about mechanics and mechatronics.

How do these collaborations help Thailand?

These are successful countries who implemented vocational education and we can learn from them.

There are a lot of pictures of Her Royal Highness Princess Maha Chakri Sirindhorn. How does HRH inspire this college?

Her idea is to educate students according to their talents. Those who do not like academic track should have the opportunity to pursue other alternatives. Her Royal Highness plays a monumental role to guide our college’s direction and inspires us to excel. When HRH visits other countries, HRH enables the college to expand our collaboration with successful institutions from abroad.

We want to change the images of vocational students in Thailand from being violent students to be responsible students.

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Indonesia shaping the South East Asian foreign policy of India and Sri Lanka

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Authors: Srimal Fernando and Megha Gupta*

Indonesia with more than 17,000 islands, occupies a key geopolitical position in the ten-member Association of Southeast Asian Nations (ASEAN) regional bloc. In the recent past Indonesia has been trying to strengthen its foreign policy outlook both diplomatically and economically through bilateral or multilateral means.

Indonesia with its large population, military capabilities, vast territory and rich natural resources in Southeast Asia is trying to align with India possessing similar power potentialities in South Asia. With this strategy in mind Indonesia has been trying to access the 1.3 billion Indian consumer market and also has been trying to cooperate with Sri Lanka due to its vital geographical position in the Indian Ocean. In this regard, there has been a growing bilateral and trilateral interest among these three countries such that they can tap into the consumer and producer market hence generating higher revenue. However, these three financial hotspots have found themselves in the forefront of challenges posed by globalization and this makes it vital for them to revive their cooperation in different areas.

Over the past few decades, Indonesia has made several development landmarks through restructuring its polity and society. The economy and foreign policy goals of this nation have constructively transformed from President Sukarno to Joko. Furthermore, in the 1980’s Indonesia also took a large step in establishing the regional body of ASEAN. Since then for more than a quarter century, ASEAN has been the most important reason for bilateral and multilateral engagements between Indonesia and the two South Asian countries.

Currently, the two-way trade between Indonesia and India stands at about $18.13 billion according to the Indonesia’s Central Statistics Agency (bps).  With this mutually beneficial relationship, in the coming years Indonesia and India are planning to enhance their bilateral trade to $50 billion. There is also said to be an increased strategic, defense and security partnership between the two which got reiterated with the state visit of the Indonesian President Joko Widodo.

Similarly, the trade between Indonesia and Sri Lanka has doubled from $418 million in 2011 to around a billion dollar in the recent past and the ties between the two is set to improve further with the establishment of a future Free Trade Agreement (FTA). The year 2018 has also marked the 66th Anniversary of the diplomatic relationship between Indonesia and Sri Lanka where the visit of the Indonesian President after 40 years saw the signing of a series of agreements between the two island nations.

Since the Bandung Summit of 1955, the Indonesia’s relationship with India and Sri Lanka has been strong. Later ASEAN has played a leading role in making this partnership grow further. However, India’s cooperation with Indonesia and ASEAN serves as a test bed for the new ideas to grow between the two regions.

Indonesia positioned between Southeast Asia and Australasia is a crucial gateway for India and Sri Lanka to further their foreign, economic and security endeavors in these two regions.

*Megha Gupta, a scholar of Masters in Diplomacy, Law, Business at Jindal School of International Affairs, India.

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