In “The Siege Within”, journalist Leslie Lopez claims Low Taek Jho, better known as Jho Low, intended to use those connections to design a “grand scheme” to resolve 1MDB’s looming financial commitments.
Low, he says, had an impressive set of contacts among the kin of several of Beijing’s powerful political class, while China was keen on finding a strong economic partner to expand its interest in Southeast Asia.
And by early 2016, the pivot to China became the newest economic initiative for embattled then prime minister Najib Razak.
“The deals Low was putting together with Chinese entities, with (Najib’s) blessing, helped register foreign direct investment flows and turned Malaysia into the most favoured destination for mainland Chinese businesses,” Lopez writes.
By mid-2016, Putrajaya had signed US$34 billion worth of Chinese investments in power generation, property development as well as contracts to build railway networks and gas pipelines among others, the book claims, adding that these projects and investments were “part of a grand scheme to bail out 1MDB”.
“The purchases of Malaysian assets by state-owned Chinese companies were inflated in order to disguise kickbacks that flowed into a slush fund to meet 1MDB progress payments.
“Similarly, Malaysia awarded government infrastructure projects to Chinese concerns at bloated valuations. These projects were funded by loans from state-owned banks in China on terms that allowed Malaysia to receive up to 80 per cent of the project funding upfront.
“These funds went towards dealing with 1MDB’s debt woes,” the book claims.
In 2019, a former aide to Najib testified at the former prime minister’s SRC International trial that several big infrastructure projects had been offered to Chinese firms.
Najib’s former special officer, Amhari Effendi Nazaruddin, said these included two pipeline projects and the East Coast Rail Link, which was intended to become a major part of China’s Belt and Road initiative.
Jho Low eyed RHB Bank to leverage on Mid-East connections
Prior to dabbling with 1MDB, Low saw RHB Bank “as an ideal vehicle to leverage his strong Middle East connections”, as he attempted to bring in the foreign direct investments that Najib’s predecessor, Abdullah Ahmad Badawi, was eager to attract.
Then only 25 years old, Low envisioned RHB as a bank with “sizeable Middle Eastern equity” and dreamt up an “ambitious and audacious multi-stage corporate exercise” to take over the bank from its existing shareholders, including the Employees’ Provident Fund which held a 31% stake.
“‘Low pitched RHB as a huge onion and with each peel there was money to be made’, recalls a banker who was involved as an advisor to the deal.
“There was huge money to make, but the broad picture of Low’s plan leaked,” the book says, which eventually thwarted the move.
The Siege Within, is available on pre-order at Lit Books, Amazon Singapore, Shopee, and at bookshops such as Kinokuniya.