Mohamed Apandi Ali, a former judge with ruling party links, who was appointed attorney general by Najib last year, said on Tuesday that $681m (£475m) secretly deposited in Najib’s personal bank accounts was a private gift from the Saudi royal family.
The extraordinary decision to drop corruption investigations into Najib Razak, Malaysia’s prime minister, highlights growing concern about lack of democratic accountability in Malaysia and across south-east Asia as a whole.
Apandi refused to address the central question of why the gift was made and for what purpose. The deposit came to light last July after foreign media investigations [paywall] into a debt-ridden state fund run by Najib known as 1MDB.
“I am satisfied with the findings that the funds were not a form of graft or bribery. There was no reason given as to why the donation was made to PM Najib, that is between him and the Saudi family,” Apandi said.
Apandi offered no explanation as to why $620m was apparently later returned to the Saudis, and what happened to the remaining $61m. The Saudi regime has declined to discuss the matter.
Najib has always denied any wrongdoing. His unmatched influence as prime minister since 2009 in the ruling Barisan Nasional coalition, and his leadership of its main political component, the United Malays National Organisation, in power continuously since 1957, makes him a difficult man to challenge.
Anwar Ibrahim, Malaysia’s best-known, much-persecuted opposition leader, nearly defeated Najib in the 2013 elections. He has has since been jailed again, on what are widely viewed as trumped-up charges. In November a UN human rights group said Anwar’s detention was illegal and his treatment in prison cruel and degrading.
Mass street protests last August failed to dislodge Najib. An ongoing currency and foreign investment slump, related to the scandal, and a demand from Malaysia’s unofficial founding father, Mahathir Mohamad, that he resign have also left him unmoved.
Instead, Najib has silenced critics, sacking ministers, appointing loyalists, and dismissing the previous attorney general, Abdul Gani Patail, who was leading corruption inquiries. Under the guise of fighting terrorism, Najib has also taken additional powers to control media and opposition, notably last month’s draconian new national security council law. Human rights groups described the law as a step towards dictatorship.
In a statement on Tuesday Najib called the scandal an “unnecessary distraction” and claimed the matter had been “comprehensively put to rest”. However, the 1MDB affair reportedly remains under legal investigation in Switzerland, Hong Kong and the US.
The absence of an international outcry about this failure of democratic accountability in Malaysia is troubling. Visiting Kuala Lumpur last July, David Cameron went through the motions, urging Najib to clean up his act. Likewise, at a November meeting, Barack Obama said he had impressed [paywall] upon Najib the importance of accountability and transparency.
In the case of the US and Britain, the former colonial power, the reluctance to make waves may be explained by the high priority they attach to keeping Malaysia, a moderate, pro-western, mostly Sunni Muslim ally, onside in the age of Islamic State and global jihad. The Obama administration also views Malaysia as part of its informal regional bulwark against China’s rise, and as an important Asia-Pacific trading partner.
Similar considerations appear to influence western attitudes towards the repressive behaviour of the junta in neighbouring Thailand. Despite earlier promises, Gen Prayuth Chan-ocha, the junta’s leader, has still not set a date for free elections.
Related: Bangkok bombing wrongfoots Thailand’s junta
In Vietnam, meanwhile, where George W Bush’s administration began a process of rapprochement in the early 2000s, the US continues to turn a blind eye to one-party rule, partly in return for Vietnamese support over Chinese maritime expansionism.
Even this modest aim is at risk as this week’s Communist party congress prepares to dump Nguyen Tan Dung, the country’s moderately reformist prime minister, in favour of the authoritarian old guard.
Amid the gloom, Myanmar may offer a glimmer of regional light after last November’s landslide election victory of the opposition National League for Democracy (NLD), led by Aung San Suu Kyi. The NLD is due to take its seats in the new parliament on Monday.
But despite assurances about a proper democratic transition, Myanmar’s military seems reluctant to hand over real control. It retains sweeping constitutional powers over security, budgets, borders and external relations, and will have a veto over who becomes the next president.
Aung San Suu Kyi met the army chief, Min Aung Hlaing, this week for only a second time since November, and it was all smiles for the cameras. But this attempt to establish a credible, functioning democracy in Myanmar could yet end in tears.