The anti-government protests that swept through the Malaysian capital of Kuala Lumpur on Saturday continued unabated on Sunday after tens of thousands of demonstrators camped in the streets overnight.
Emboldened by the presence of influential former Prime Minister Mahathir Mohamad, protesters chanced being confronted with water cannons and tear gas, which police used to disperse crowds at previous Bersih rallies.
As we detailed on Saturday, calls for the ouster of Prime Minister Najib Razak have grown louder in recent months after the government appeared to be obstructing an investigation into how more than $600 million in funds from a Goldman-backed development bank ended up in Najib’s personal bank account. Mahathir Mohamad, who many say still hasn’t accepted the fact that he hasn’t been Prime Minister since 2003, has called for a no-confidence vote and insists that the man he handpicked to govern "has to go."
Estimates of Sunday’s crowd varied slightly depending on who you listen to. Police, for instance, say the gathering attracted around 20,000 protesters while Bersih insists the number was closer to 300,000.
Whatever the number, it was large enough to cause the police to move tonight’s Independence Eve celebrations from Kuala Lumpur’s Merdeka Square to a location outside the city, Bloomberg said, citing local officials.
As for Najib, the premier blasted the protesters in comments made to the media on Sunday. "What is 20,000? We can gather hundreds of thousands. The rest of the Malaysian population is with the government."
Perhaps, but that too could change should the country plunge further into financial crisis. As we've documented extensively (here and here, for instance), a plunging currency, falling FX reserves, and a collapsing stock market threaten to push Malaysia over the edge and many fear a repeat of the capital controls the country introduced to stem the 1997/98 crisis may be just around the corner.
And the punchline - because there's always a punchline - the government has banned the color yellow...
* * *
For those interested in the backstory, we have included it below
1MDB was set up by Najib six years ago and has been the subject of intense scrutiny for borrowing $11 billion to fund questionable acquisitions. $6.5 billion of that debt came from three bond deals underwritten by Goldman, whose Southeast Asia chairman Tim Leissner is married to hip hop mogul Russell Simmons’ ex-wife Kimora Lee who, in turn, is good friends with Najib’s controversial wife Rosmah Manso.
You really cannot make this stuff up.
What Goldman did, apparently, is arrange for three private placements, one for $3 billion and two for $1.75 billion each back in 2013 and 2012, respectively. Goldman bought the bonds for its own book at 90 cents on the dollar with plans to sell them later at a profit (more here from FT). Somewhere in all of this, $700 million allegedly landed in Najib’s bank account and the going theory is that 1MDB is simply a slush fund.
So you can see why some folks are upset, especially considering Rosmah has a habit of having, how shall we say, rich people problems, like being gouged $400 for a home visit by a personal hairstylist. Here’s The New York Times with more on the protests:
Tens of thousands of demonstrators in Malaysia defied police orders on Saturday, massing in the capital in a display of anger at the government of Prime Minister Najib Razak, who has been accused of corruption involving hundreds of millions of dollars.
The demonstration in central Kuala Lumpur, which has been planned for weeks, has been declared illegal by the Malaysian police, and the government on Friday went as far as to pass a decree banning the yellow clothing worn by the antigovernment protesters.
But the demonstrators, who represent a broad coalition of civic organizations in Malaysia, including prominent lawyers, asserted their right to protest on Saturday.
The government has acknowledged that Mr. Najib received the money in 2013 and said it was a donation from undisclosed Arab royalty.
One group of protesters on Saturday carried the image of a giant check in the amount of 2.6 billion ringgit, with a sign that read, “You really think we are stupid?”
The group organizing the protest goes by the name Bersih, which means clean in Malay.
Calls for Mr. Najib to resign have come both from within his party, which is divided, and from the opposition. One junior member of Mr. Najib’s party, the United Malays National Organization, filed a lawsuit against Mr. Najib on Friday asking for details of how the money was spent.
Of course the most prominent voice calling for Najib’s ouster is that of the former Prime Minister Mahathir Mohamad. "I don’t believe it is a donation. I don’t believe anybody would give [that much], whether an Arab, or anybody," he says.