Najib Rewards Party Loyalists in Malaysia Cabinet Rejig

  • Premier has faced calls to resign over funding scandals
  • Ruling coalition retained two seats in recent by-elections

Malaysian Prime Minister Najib Razak rejigged his Cabinet and rewarded party loyalists who have backed him through a year of scandals, further bolstering his grip on power.

Abdul Rahman Dahlan, minister of housing, urban wellbeing and local government, will now be head of the Economic Planning Unit, Najib told reporters on Monday. His former position will be filled by Noh Omar, chief of Najib’s United Malays National Organisation in the state of Selangor, where a recent by-election saw the party retain a seat with a wider margin.

Johari Abdul Ghani, who was deputy finance minister, is now Second Finance Minister. Najib named Mah Siew Keong, a minister in his office, to be in charge of the Ministry of Plantation Industries and Commodities. The premier said he will reshuffle the duties of ministers in his department and will announce the changes soon.

“These new Cabinet appointments are designed to strengthen the government and ensure that we focus unwaveringly on our economic development plan for Malaysia," Najib said. “This government’s priority will continue to be the economic welfare, social wellbeing and security of all Malaysians.” ‎

Poll Victories

The Cabinet revamp came after Najib’s coalition retained two seats in a June 18 by-election, garnering a bigger majority in both.

Najib previously rejigged his ministerial lineup last July, seeking to head off internal rumblings amid scandals surrounding troubled state fund 1Malaysia Development Bhd., whose advisory board he had chaired. Najib dumped his then-deputy Muhyiddin Yassin in that change after Muhyiddin called for greater clarity on the 1MDB investigations.

Najib strengthened his hold over the ruling UMNO after the party’s supreme council voted unanimously on Friday to expel Muhyiddin and Mukhriz Mahathir, son of former premier Mahathir Mohamad. The two have been critics of Najib amid a campaign led by Mahathir Mohamad for the premier’s removal, although Mukhriz has recently toned down his public comments and congratulated the UMNO-led Barisan Nasional coalition on its by-election wins.

Najib named Johari as a replacement for Ahmad Husni Hanadzlah, who had held the Second Finance Minister position since 2009 and stepped down for personal reasons. Husni is also giving up his leadership positions in UMNO which include his role as the party’s treasurer and a division chief, according to a political aide.

Political Donations

The premier has faced political tensions for a year, including questions over $681 million that ended up in his bank accounts before the 2013 general election. While Najib has the support of powerful divisional chiefs in UMNO, the protracted turmoil is a distraction as economic growth slows. Voters -- including his key support base of ethnic Malays -- face increased living costs.

Malaysia’s stock benchmark FTSE Bursa Malaysia KLCI Index fell 0.3 percent on Monday, while the ringgit dropped 0.2 percent to 4.0985 per dollar in Kuala Lumpur.

Najib received a boost in May from Barisan Nasional’s strong win in the Sarawak state election. BN secured a bigger majority in the country’s largest state, helped by Najib’s pledges of development funds and by a fractured opposition.

The government has said the money in Najib’s account was a private donation from the Saudi royal family, and most of it was later returned. Both 1MDB and Najib have denied any wrongdoing over money.

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