Lim Guan Eng

Malaysia’s new finance minister has big job ahead

Malaysia’s new finance minister, Lim Guan Eng, has stated he doesn’t care about being “unpopular” – but can Mahathir Mohamad’s new government fix the $250 billion deficit without abandoning campaign promises?

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July 19, 2018
Malaysia’s new finance minister has big job ahead
New Malaysian Finance Minister Lim Guan Eng speaks during a press conference at the Ministry of Finance Complex in Putrajaya, Malaysia Photo: Ahmad Yusni / EPA-EFE
Who is he?

Formerly the chief minister of Malaysia’s flourishing Penang state, Lim Guan Eng – who also serves as secretary-general of the centre-left Democratic Action Party (DAP) – was appointed Minister of Finance by Prime Minister Mahathir Mohamad after the opposition coalition’s unprecedented triumph in this year’s national election. Once the chairman of the DAP Socialist Youth, the former chartered accountant spent a year in prison in the late 90s after publicly criticising the nation’s attorney general for not pursuing a statutory rape case against a chief minister in the ruling UMNO coalition that has dominated Malaysian politics since independence.

Illustration: Antiochus Omissi for SEA Globe
Why is he in the news?

Widespread jubilation at the historic election of Malaysia’s opposition has been somewhat tempered by Mahathir’s revelation that the national deficit is far greater than previously believed – more than $250 billion. The new government has heaped much of the blame for the economic malaise on what it describes as widespread corruption, embezzlement and mismanagement under former prime minister Najib Razak, who is being investigated for his role in a series of high-profile corruption scandals, including the theft of billions of dollars from the 1MDB sovereign wealth fund. Now, Lim Guan Eng finds himself in the unenviable position of having to potentially slash spending on public services and infrastructure after campaigning heavily on bringing down the cost of living.

Will the public forgive him?

National University of Malaysia Emeritus Professor in Sociology Abdul Rahman Embong argued that, despite the bitter news, the government’s decision to fulfil its promises to remove the deeply unpopular goods and services tax and bring back fuel subsidies had proven a hit with the Malaysian public. “There is at present enormous goodwill towards the new government and Lim Guan Eng,” he said. “The people want the government to tell the truth and bite the bullet. The people are sick and tired of 61 years of UMNO-Barisan Nasional, especially of Najib – his corruption, abuse of power, arrogance and disconnect with the people. They regard getting rid of UMNO rule like attaining second independence.”

So can he fix the economy?
Short-term measures like the Tabung Harapan Malaysia fund – which allows ordinary Malaysians to donate money to directly pay off the nation’s debts and has so far collected tens of millions of dollars – seem unlikely to address the full extent of the deficit. Abdul said these measures have been popular, and that there’s also widespread public support for a full investigation into the entrenched corruption that has dragged Malaysia’s economy for decades. “The timing is both ripe and right to wage an all-out war against corruption, abuse of power, maladministration and wastage,” he said. “Heads must roll and the law must come down hard on those who break the law with impunity. The kleptocratic regime must be dismantled and the institutional reforms promised by [the victorious] Pakatan Harapan [coalition] must be throughgoing. I think Malaysia has all these ingredients to succeed. Failure is not an option.”

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