China offered to bail out 1MDB, scuttle probe in return for mega projects, says report
FMT Reporters
-January 8, 2019 9:33 AM
Najib Razak was promoting the East Coast Rail Link project, among several big contracts awarded to Chinese firms. (Bernama pic)PETALING JAYA: Beijing had offered to help bail out troubled state firm 1MDB in 2016 in exchange for lucrative stakes in railway and pipeline projects, the Wall Street Journal (WSJ) reports citing minutes from meetings between Chinese and Malaysian officials.
The paper, which broke the 1MDB story in July 2015, said Chinese officials had proposed that Beijing use its influence to try to persuade the US and other countries to drop their investigations into the state investment fund, following revelations of billions of dollars being siphoned off from the company.
It said the purposes of the projects eyed by China were meant to appear market-driven in nature despite their true aim to “shore up Najib Razak’s government, settle the 1MDB debts and deepen Chinese influence in Malaysia”.
1MDB is under investigation in at least six countries including Singapore and Switzerland.
According to the minutes, WSJ said, the Chinese also offered to launch surveillance of the homes and offices of journalists in Hong Kong who were investigating 1MDB.
This, according to a Malaysian summary of the meeting, included “full scale residence/office/device tapping, computer/phone/web data retrieval, and full operational surveillance”.
WSJ also quoted people familiar with the meetings who claimed the former prime minister had been aware of them.
It said a review of documents related to the meetings showed that Malaysian officials had suggested that some of the projects be financed at above-market values, which would generate extra cash for other needs.
When asked about the meetings, it said, Najib issued a statement saying the rail project would have brought many jobs to Malaysia and that under his leadership, the country had experienced nine years of continuous economic growth.
