Razak Baginda: Graft draws lousy investors


PETALING JAYA: Centre for Global Affairs Malaysia (Icon) president Abdul Razak Baginda has warned that international investors who take advantage of a corrupt system are likely to be ones offering products or services of dubious quality.

Razak, a former adviser to Prime Minister Najib Razak, was voicing his qualified agreement with another former Najib aide, who said recently that the 1MDB scandal was unlikely to prevent international businesses from investing in Malaysia.

Oh Ei Sun, who was Najib’s political secretary from 2009 to 2011 and is now a fellow at the S Rajaratnam School of International Studies in Singapore, said in a CNBC interview that if one were to “go into the minds of international investors” one would find that “a degree of corruption for businessmen is very common and in fact they will welcome and embrace that.”

Razak told FMT he agreed that a corrupt system would be inviting to some investors. But Malaysian leaders needed to decide whether they would want such businessmen to invest in the country, he added.

“If you’re bidding for a contract and you know your product is good and your pricing is good, then you really want to make sure that it’s a level playing field,” he said.

“If your product is bad and your pricing is bad, then you want corruption because otherwise you don’t stand a chance.”

He acknowledged, however, that “whom you know” would most often be as important as an investor’s capabilities when he’s bidding for a project.

“If there are five or six bidders for a contract, then more often than not, all five will have the same capability,” he said. “The only difference would be some minor elements such as packaging. That’s speaking generally.”