Malaysian Prime Minister Anwar Ibrahim during a press conference in New Delhi, India, Tuesday, August 20, 2024.
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Eradicating corruption in Malaysia continues to be a difficult obstacle that Prime Minister Anwar Ibrahim must overcome if he wants to attract foreign direct investment to the country.
As Anwar approaches his second anniversary since being sworn in as prime minister, he remains deeply committed to this crackdown, and is taking a no-nonsense approach to solving the problem, he said.
“We have to save the country. In my mind… the main problem is poor governance and endemic corruption,” he told CNBC’s JP Ong.
Anwar explained that domestic and foreign investors will be more confident if they see consistency in the process of transparency and a stronger commitment to ending corruption.
“Without that trust (and) confidence, no one will invest in a big way. Except for those who have corrupt arrangements – it will continue. But it must stop. And fortunately, it has stopped,” he said.
“Although, we are still doing this mission, because I have strongly suggested that in terms of corruption, it is almost systemic. If we mean systemic, it means that the mission, the crusade against corruption, must be complete by force,” he added.
‘I’ll just follow him mercilessly’
Malaysia welcomes foreign direct investment inflows of 40.4 billion Malaysian ringgit ($9.7 billion) in 2023, a significant drop from the peak of 48.1 billion ringgit in 2021, government data shows. Meanwhile, the Southeast Asian country lost about 277 billion ringgit in economic output due to corruption from 2018 to 2023, according to official data.
When asked by CNBC if the government is too fast and hard to fight corruption, Anwar said he has a way, “damn it… I’m just going to follow him without mercy.”
However, he explained that he must ask the coalition to talk about the best way to solve this problem, and said that if they continue “very slowly and ineffectively … the nation will not be saved.”
“And I have now gained enough to suggest that this mission will continue,” he said.
Anwar did not speak specifically about the corruption case, nor did he mention the former leader during the interview. However, many cases of corruption still make headlines when proper governance in Malaysia is discussed. One of the most notorious cases is the 1Malaysia Development Berhad money laundering scandal, where then Prime Minister Najib Razak was found guilty of misappropriating millions of dollars.
In May, the government launched a new national anti-corruption strategy that aims to elevate Malaysia to one of the top 25 countries on Transparency International’s Corruption Perceptions Index over the next decade. Malaysia is currently ranked 57th in the index.
Malaysia’s economy grew by 3.7% last year, up from 8.7% in 2022, as the country recovers from the pandemic. Still, it is lower than the 4.3% growth seen in 2019.
As part of Malaysia’s strategy to increase the flow of foreign investment and propel the country’s economic standing, two separate economic zones are already in the works.
An agreement on the Johor-Singapore Special Economic Zone is likely to be finalized by the end of the year, a move aimed at increasing cross-border trade and investment activities.
Malaysia is also seeking investment into the Forest City special financial zone, hoping to increase business activity and push Iskandar Puteri into a business district with great talent. The government announced last week that Forest City will be the first place in Malaysia to offer a zero percent tax rate on family offices.
