I have been visiting Malaysia for 30 years – family reasons. It is a captivating yet frustrating country, full of potential that is never quite realised. Domestic politics has a lot to do with this. I’ll leave the wider issues to one side, and comment here only on the defence aerospace business, where I have some expertise.
The Defense Services Asia (DSA) event in Kuala Lumpur this week brought the great and the good – and the not so good – to a large exhibition venue in the suburbs. Top brass from many regional countries attended. But the focus was on Malaysia’s defence policies and procurements.
For its size, the country has a relatively small air force. But the Royal Malaysian Air Force (RMAF) has habitually outlined ambitious new requirements. Its desire for a fourth-generation Multi-Role Combat Aircraft (MRCA) brought Dassault, Eurofighter and all to successive trade events. These companies spent a lot of money, but ultimately got nowhere. The country couldn’t afford such expensive jets.
“Malaysia has acquired a reputation for window shopping,” one informed foreign observer of the local scene told me. More than that, though, it has long had a reputation for doing dodgy deals, involving inflated commissions paid by overseas contractors to middle men, and some outright bribery. Most of these never reach the public domain, but a scandal involving the Navy’s Littoral Combat Ship (LCS) has surfaced. Two unnamed chief executive officers are suspected of receiving bribes through payments to three companies abroad.
The Malaysian Army has just taken delivery of six armed MD530G helicopters. They are years late. That’s no fault of the contractor, MD Helicopters. They chose a local agent to “smooth the path” to a contract. But that agent fell out of favour. It took a change of government to right matters.
In 2003, the RMAF bought 18 Sukhoi Su-30MKI fighters. The opposition leader, exiled at the time in Dubai, later told media that the Russians paid a substantial bribe to the Defence Minister Najib Razak. Quite probably true, since Najib subsequently became Prime Minister and skimmed off MYR2.7 billion ($700 million) from the 1MDB national investment fund. He was convicted, but is currently out on bail pending an appeal. (The Sukhois are still in service, but facing an uncertain future because of sanctions against Russia for invading Ukraine).
Senior Defence Minister Dato Seri Hishammuddin Tun Hussein says that things are changing. After the RMAF abandoned the MRCA, it developed a requirement for a Light Combat Aircraft (LCA) that could also serve as a Fighter Lead-In Trainer (FLIT). Hishammuddin told Parliament that an open tender was advertised “to ensure that there are no more issues of transparency and misconduct in the procurement process.” There are five contenders and a decision is due shortly.
We shall see. Another RMAF tender has closed, for two Maritime Patrol Aircraft (MPA). Why only two, when Malaysia is surrounded by waters that are rife with pirates and illegal fishermen? Not to mention the Chinese, who have laid claim to large swathes of the South China Sea, and built military bases on newly-created islands. The reason is probably that they can’t afford more. I was told that the RMAF favours the Leonardo ATR72MP, but has asked the company to reduce its price – without reducing the specification in any way. The strange thing is, the service is about to introduce three smaller CN235 maritime surveillance aircraft that have been converted from CN235 transports already in service with the RMAF. They do not have full MPA capability, such as for anti-submarine warfare. But is that really a priority for Malaysia? And don’t you think that the RMAF would have introduced the CN235s and seen how they perform, before making a more ambitious and expensive procurement? Incidentally, the CN235 conversions were funded by the US government under a military capacity-building scheme. The sensors are therefore American. No local commissions there, I presume.
As I walked the halls at DSA, I noticed how few Indian or Chinese were to be seen. Certainly none amongst the Malaysian military heirarchy, who are all Muslims. Yet the Indians and Chinese are substantial minorities in Malaysia. I’m sure that they have the talent to contribute significantly to the country’s defence operations and industrial development. A big missed opportunity for the country, that sadly seems likely to continue.
I truly hope that Malaysia is cleaning up its act, especially with respect to big government procurements. Unless they do, it’s small wonder that the population at large tolerates endemic corruption at the working level. On my way to the airport in a taxi after DSA, we passed a half-dozen cars that had pulled over by the police, probably for speeding. The taxi driver explained that the officers would be seeking a cash bribe in lieu of issuing a ticket for a fine. The latter would cost MYR300 ($70) whereas the bribe would only be MYR50 ($12). According to the taxi driver, the going rate for the bribe had recently increased from MYR10 because the pandemic had reduced the number of cars on the road that could be stopped, and because the policemen needed some extra cash for the upcoming Hari Raya Muslim festival. He accepted the situation. “Their basic pay is not much,” he added.
amended to clarify that Najib Razak was Defence Minister in 2007, when the opposition leader made his accusation
my report on the show for AIN can be found here