MALAYSIA'S NEW CABINET - STATUS QUO WITH ONLY

C O N F I D E N T I A L SECTION 01 OF 05 KUALA LUMPUR 000192 SIPDIS SIPDIS FOR EAP/MTS E.O. 12958: DECL: 03/18/2018 TAGS: PGOV PREL KDEM MY SUBJECT: MALAYSIA'S NEW CABINET - STATUS QUO WITH ONLY HINTS OF REFORM REF: A. KUALA LUMPUR 184 - POST-ELECTION SCENE ¶B. KUALA LUMPUR 178 - ELECTION AFTERMATH ¶C. KUALA LUMPUR 163 - CRUNCHING BN'S NUMBERS ¶D. KUALA LUMPUR 160 - ELECTION SHOCK ¶E. 07 KUALA LUMPUR 291 - RAZAK BAGINDA CASE KUALA LUMP 00000192 001.2 OF 005 Classified By: Political Section Chief Mark D. Clark for reasons 1.4 (b , d). Summary -------------- ¶1. (C) Prime Minister Abdullah Badawi announced his new cabinet on March 18, retaining roughly half (17) of his ministers from the previous cabinet, but bringing in only a few politicians identifiable for their reform credentials. Abdullah remained Finance Minister I, but gave up his his position as Internal Security Minister. Najib Tun Razak remains Deputy Prime Minister and Defense Minister. Other senior UMNO stalwarts continue to occupy the most important portfolios, including Internal Security/Home Affairs (now combined),Finance II, Agriculture, and International Trade/Industry. Former Culture Minister Rais Yatim has been appointed the new Minister of Foreign Affairs. Abdullah shed a number of prominent cabinet members including Rafidah Aziz and Samy Vellu, while Abdullah's son-in-law Khairy Jamaluddin did not make the cut. Identifiable reformers or UMNO progressives include Zaid Ibrahim with the de facto justice portfolio, Shahrir Samad for Domestic Trade, and possibly Shabery Cheek as Information Minister. ¶2. (C) The cabinet make-up reflects UMNO's dominance in the National Front (BN) coalition, with 23 positions, unchanged from the outgoing cabinet. East Malaysia only received a total of four cabinet seats, also unchanged from the previous cabinet despite Sabah and Sarawak's contribution of roughly one-third of BN's parliament seats. The cabinet does not appear to strengthen DPM Najib's hand and possibly weakens it with the removal of several long-time Mahathir cronies, suggesting Abdullah does not want to empower the man best poised to challenge him for UMNO leadership. Following the election debacle, Prime Minister Abdullah stated that he understood Malaysians were not satisfied with his first administration, but he will have a difficult time presenting the new cabinet as a strong platform for change in response to many voters' desertion of the National Front. Regardless, PM Abdullah is not likely to be able to remain in office beyond the next UMNO elections, and we believe most observers will view this cabinet as an interim line-up until UMNO has settled its leadership question. End Summary. Abdullah restructures his cabinet -------------- ¶3. (SBU) Prime Minister Abdullah Ahmad Badawi announced his new cabinet in a noon press conference on March 18, just 10 days after his National Front (Barisan Nasional or BN) coalition emerged from a hotly contested snap election with a significantly decreased majority. Malaysia's monarch, the Yang di-Pertuan Agong, is scheduled to swear in the new ministers on March 19 at the National Palace. In announcing the cabinet, Abdullah reduced the number of ministries from 28 to 27 and retained roughly half (17) of his former ministers. Abdullah merged the Ministry of Internal Security and the Ministry of Home Affairs, recreating a significant concentration of power. He also merged the Office of National Unity (formerly a division in the PM's Department) with the Ministry of Culture, Arts and Heritage. By eliminating all Parliamentary Secretaries, whose value to government efficiency appeared questionable, Abdullah further reduced the overall size of his cabinet from 90 to 68. BN's reduced majority in the 12th Parliament and the corresponding increase in opposition parliamentarians mean Abdullah needs more back-benchers to regularly attend parliament sessions. A smaller cabinet will ensure BN controls sufficient seats in parliament on a daily basis to achieve their legislative objectives. Out with the old -------------- ¶4. (SBU) Conspicuously absent from the new line up are former Minister of International Trade and Industry, Rafidah Aziz; former Minister of Science and Technology, Dr. Jamaluddin Jarjis; former Minister of Home Affairs and current UMNO Secretary General, Radzi Ahmad; former Minister of Tourism, SIPDIS KUALA LUMP 00000192 002.2 OF 005 Tengku Adnan Tengku Mansor; former Minister of Human Resources, Dr. Fong Chan Onn; former Minister in the PM's Department, Dr. Abdullah Md Zin; and former Minister of Natural Resources, Azmi Khalid. As previously announced, Abdullah did not nominate as senators and subsequently reappoint any previous cabinet member who failed to be reelected in the 2008 General Election, to include: former Minister of Rural and Regional Development Abdul Aziz Shamsuddin; former Minister of Public Works, S. Samy Vellu; and former Information Minister Zainuddin Maidin. Former Minister of Housing and Local Government, MCA President Ong Ka Ting, declined to accept a new cabinet posting, and former ministers Chua Soi Lek (Health) and Dr. Lim Keng Yaik (Energy, Water and Communications) resigned before the 2008 elections. Chan Kong Choy (Transportation) and Mohd Effendi Norwawi (PM's Department) did not seek re-election and were thus ineligible for reappointment. ¶5. (SBU) Former Women's Ministry Shahrizat Jalil became an exception to Abdullah's decision not to reappoint ministers who failed at the polls. In a separate written announcement from the PM's office, Abdullah announced that Shahrizat, current deputy and possible heir apparent for UMNO's women's wing, has been appointed as a Special Advisor to the PM for women's issues, with the rank of minister. ¶6. (C) We note that Abdullah's son-in-law Khairy Jamaluddin was absent from the new line up. Prior to BN's shocking election set-back, Khairy was widely touted for a minister or deputy minister slot. Many in UMNO appear to blame Khairy as an significant factor behind UMNO and BN's poor showing. In with the new -------------- ¶7. (SBU) While several previous deputy ministers were promoted in the new cabinet, there were a number of new faces to Abdullah's administration. Most notable of the new additions are attorney and former parliamentarian Zaid Ibrahim; former President of the BN Backbenchers' Club Shahrir Samad; former Parliamentary Secretary in the MFA, Ahmad Shabery Cheek; and former Chief Minister of Selangor and current UMNO Information Chief Muhammad Muhammad Taib. Zaid has been appointed a Minister in the PM's Department and charged with overseeing reforms in the judiciary. Shahrir Samad, who also served as the outgoing chairman of Parliament's Public Accounts Committee, has been appointed as the new Minister of Domestic Trade and Consumer Affairs. Shabery Cheek is a relatively young and seemingly progressive parliamentarian who could bring a new approach to the Ministry of Information. Muhammad, a long-term UMNO insider and power player, has returned to federal politics as the Minister of Rural Development. Party, Race and Gender -------------- ¶8. (SBU) Although the new cabinet saw the number of ministries reduced by one to 27, the number of cabinet ministers remained unchanged at 32, with UMNO Malay ministers not only occupying the large majority of the seats but also the key cabinet portfolios. Out of the 32 member cabinet, UMNO holds 23 positions, followed by MCA with 4, and MIC, Sabah's PBS and UPKO, and Sarawak's SUPP and PBB each with one. Old-time UMNO stalwarts continue to hold the most important portfolios of Finance I and II (PM Abdullah and Nor Yakcop),Defense (DPM Najib),Internal Security/Home Affairs (former FM Syed Hamid Albar),Agriculture (Mustapha Mohamad), and International Trade/Industry (UMNO VP Muhyiddin). Former Culture Minister Rais Yatim, not known for his dynamism, has been appointed the new Minister of Foreign Affairs. ¶9. (SBU) The racial breakdown of the cabinet includes 23 Malays (those of UMNO),five Chinese, and one each from the Indian, Kadazan-Dusun and Iban-Dayak Communities. The number of cabinet positions represented by Sabah (non-UMNO) and Sarawak Members of Parliament remain unchanged with two cabinet portfolios from each state, despite East Malaysia's contribution of one-third of BN's seats in parliament. From Sabah, both the non-UMNO cabinet positions are held by leaders from the indigenous Kadazan-Dusun community, while from Sarawak, one is held by a Chinese Sarawakian and the other by a leader from the indigenous Iban-Dayak community. Except for Melaka and Perlis, all other states had representatives in the cabinet with Johor having the largest representation with seven ministers, followed by Pahang and KUALA LUMP 00000192 003.2 OF 005 Selangor with four each. ¶10. (SBU) There are only two women in the cabinet-- one each from UMNO and MCA. This compares to three women in Abdullah's previous cabinet. Whither support for Najib? -------------- ¶11. (C) Prior to the cabinet announcement, observers speculated about the involvement of Deputy Prime Minister Najib in the cabinet making, but at first glance the new cabinet does not appear to strengthen Najib's hand. The cabinet removes some long-time Mahathir cronies, notably Jamaluddin Jarjis and Tengku Adnan Mansor, and consequently two close allies of Najib, given Mahathir's backing of Najib over Abdullah. Of course, Najib retains the key Defense portfolio, and another important member of his camp, Education Minister and UMNO Youth chief Hishammuddin, remains in place. We have not identified other Najib supporters newly included in the cabinet. Speculation has already begun in opposition circles that Abdullah has resisted efforts to strengthen Najib ahead of the UMNO leadership elections. ¶12. (C) Abdullah, who boasted of selecting only honorable, uncorrupted ministers, was forced at his live March 18 press conference to field pointed questions from the journalists regarding his reappointment of Najib as DPM. One reporter specifically asked Abdullah to explain Najib's re-appointment given the frequent allegations of wrongdoing in military contracts (ref E). Abdullah, initially taken aback by the question, responded that "there is no proof that Najib is involved in any corrupt activities. People can make all kinds of allegations, but what is important is that there is no evidence of that." (Comment: Abdullah's reappointment of Najib as DPM was a foregone conclusion, given Najib's position as Deputy President of UMNO. Najib faces public and private criticism for allegedly profiting greatly from the Sukhoi jet and Scorpene submarine purchases, and for rumored ties to the Razak Baginda murder case. End Comment). Comment -------------- ¶13. (C) After the election debacle, Prime Minister Abdullah stated that he understood many Malaysians were not satisfied with his first administration. Abdullah, however, will have a difficult time presenting the new cabinet as a platform for change in response to voters' desertion of the National Front. Despite the appointment of Zaid Ibrahim and Shahrir Samad, two noted reformists, and possibly Shabery Cheek, there is little other initial indication that Abdullah has broken the status quo. The majority of appointees are long-time UMNO insiders who have benefitted from the system, not challenged it. The states of Sabah and Sarawak have not gained any significant influence in the cabinet, despite their critical role in voting in roughly one-third of BN's parliamentary seats. De facto opposition leader Anwar Ibrahim has already spoken publicly of his desire to woo BN's East Malaysia partners into the opposition, and thus remove BN from power, and the cabinet line-up does not appear to cement East Malaysia's allegiance to Abdullah's National Front. We still assess that PM Abdullah is not likely to be able to remain in office beyond the next UMNO elections (septel),and as challenges to Abdullah's authority continue so do rumors of plans to remove him even sooner than the UMNO vote. This cabinet is best viewed as an interim line-up until UMNO has settled its looming leadership question. End Comment. New Cabinet Line-Up -------------- ¶14. (U) The new cabinet is presented below. Septel provides more detail about changes in the portfolios. Prime Minister: Abdullah Ahmad Badawi Deputy Prime Minister: Najib Tun Razak Ministers in the Prime Minister's Department: Bernard Dompok Nazri Aziz Ahmad Zahid Hamidi Mohd Zaid Ibrahim KUALA LUMP 00000192 004.2 OF 005 Amirsham Abdul Aziz Deputy Ministers in the Prime Minister's Department: Johari Baharom Dr Mashitah Ibrahim ¶K. Devamany Hassan Malik Finance Minister - Abdullah Ahmad Badawi Second Finance Minister - Nor Mohamed Yakcop Deputies - Ahmad Husni Hanadzlah, Kong Cho Ha Defense Minister - Najib Tun Razak Deputy - Abu Seman Yusop Internal Security and Home Affairs Minister - Syed Hamid Albar Deputies - Chor Chee Heong, Senator Wan Ahmad Farid Wan Salleh Housing and Local Government Minister - Ong Ka Chuan Deputies - Robert Lau , Hamzah Zainuddin Works Minister - Mohd Zin Mohamad Deputy- Yong Khoon Seng Energy, Water and Communications Minister - Shaziman Abu Mansor Deputy- Joseph Salang Gandum Agriculture and Agro-based Industry Minister - Mustapa Mohamed Deputy - Rohani Abdul Karim International Trade and Industry Minister - Muhyiddin Yassin Deputies- Loh Wei Keong, Jacob Dungau Sagan Foreign Affairs Minister - Dr. Rais Yatim Deputy- Tunku Azlan Abu Bakar Education Minister - Hishammuddin Hussein Deputies - Wee Ka Siong, Razali Ismail Higher Education Minister - Khaled Nordin Deputies - Khoo Kok Choong, Idris Harun Transport Minister - Ong Tee Keat Deputy - Anifah Aman Human Resources Minister - S. Subramaniam Deputy- Noraini Ahmad Women, Family and Community Development Minister- Dr Ng Yen Yen Deputy- Noriah Kasnon National Unity, Culture, Arts and Heritage Minister- Shafie Apdal Deputy- Teng Boon Soon Science, Technology and Innovation Minister- Dr Maximus Ongkili Deputy- Fadilah Yusof Entrepreneurial and Cooperative Development Minister - Noh Omar Deputy- Saiffuddin Abdullah Natural Resources and Environment Minister - Douglas Unggah Embas Deputy - Abu Ghapur Salleh Rural and Regional Development Minister - Muhammad Muhd Taib Deputy- Joseph Kurup Domestic Trade and Consumer Affairs Minister - Shahrir Samad Deputy - Jelaing Mersat Plantation Industries and Commodities Minister - Peter Chin Fah Kui Deputy- Senator A. Kohilan Youth and Sports Minister - Ismail Sabri Yaacob Deputy - Wee Jack Seng Health Minister - Liow Tiong Lai Deputy- Dr. Abdul Latiff Ahmad KUALA LUMP 00000192 005.2 OF 005 Information Minister - Ahmad Shabery Cheek Deputy- Tan Lian Hoe Tourism Minister - Azalina Othman Deputy - Sulaiman Abdul Rahman Abu Taib Federal Territories Minister - Zulhasnan Rafique Deputy- M. Saravanan SHEAR