Wall Street Journal
29th Sept 2015

Minorities become scapegoats as Najib tries to keep power.

Malaysian Prime Minister Najib Razak’s fight for political survival has divided the ruling United Malay National Organization and hurt the nation’s economy. Now it is sparking racial discord. Malaysia’s history of ethnic strife, including the 1969 riots in which hundreds of Chinese were killed, makes this development especially troubling.

At the end of August, a series of rallies by the reform movement Bersih demanded that Mr. Najib resign because of corruption allegations that he denies. The main Malay opposition party PAS didn’t take part as it did in past Bersih rallies, so the crowd of at least 50,000 was mostly made up of Chinese and Indian minorities.

That gave Mr. Najib’s supporters a pretext to claim that the main ethnic Chinese opposition party, the Democratic Action Party, is part of a conspiracy to bring down the Prime Minister and take away the affirmative-action privileges reserved for the Malay majority. On Sept. 16 the most radical hotheads, known as red shirts, tried to rally in Kuala Lumpur’s Chinatown, scene of the worst violence in 1969.

To the government’s credit, the police have largely kept the red shirts out of Chinatown and prevented violence. But UMNO politicians lead the red-shirt movement, which is well funded and organized. UMNO-controlled media outlets have joined in the portrayal of opposition reformers as a threat to the Malays. Mr. Najib defended the rally as a response to insults against Malay leaders.

On Friday Chinese Ambassador Huang Huikang waded into the controversy. Speaking at a holiday event in Chinatown as the red shirts planned another foray into the area, he said that the Chinese government opposed terrorism, extremism and discrimination based on race. “But with regard to the infringement on China’s national interests, violations of legal rights and interests of Chinese citizens and businesses, which may damage the friendly relationship between China and the host country, we will not sit by idly,” he warned.

The threat came as a surprise because it broke Beijing’s usual policy on noninterference in other countries’ internal affairs. Malaysia has steadily moved closer to China, and the two countries began their first joint military exercise the day before the Ambassador’s remarks.

As China feuds with the Philippines and Vietnam over islands in the South China Sea, Malaysia has helped deflect pressure for multilateral talks involving the Association of Southeast Asian Nations.

But the rising nationalism that drives Chinese aggression in the South China Sea also means that Beijing will speak up for ethnic Chinese under attack in the region. China has plenty of economic leverage, with annual two-way trade exceeding $100 billion and Chinese investment in Malaysia booming.

If race riots do recur, retaliation from China wouldn’t be the biggest cost. Ethnic Chinese and Indian Malaysians still dominate the economy and could move their capital and management know-how offshore. Prominent Malaysian entrepreneur Tony Fernandes, CEO of AirAsia Group, recently cited deteriorating race relations as one of his biggest worries.

The system of racial preferences created after the 1969 riots to mollify Malay anger have had a perverse effect. The benefits fostered corruption among UMNO politicians who channeled public funds to their cronies. The struggling Malaysian economy means the competition for spoils is even more vicious.

Even if Mr. Najib steps down, tensions are likely to increase for some time. After the Prime Minister sacked his deputy and rival, Muhyiddin Yassin, in July and purged other reformers from UMNO, Malay chauvinists have moved into positions of power. Malaysia’s minorities have good reason to fear they will again be scapegoats in the country’s power struggles.