×

Mahathir: Malaysia must rid itself of PM Najib

Malaysia's iconic former leader Mahathir Mohamad on Friday signed a declaration with members of both opposition and ruling parties to remove Prime Minister Najib Razak.

If Najib is allowed to remain in power, the damage from the scandal related to the deeply indebted state fund 1MDB will become worse, Mahathir said.

"We must rid ourselves of (Najib) as the prime minister of Malaysia," he said.

The declaration, which Mahathir read aloud in English at a press conference, said that Malaysia had descended to become one of the 10 most corrupt countries in the world under Najib's leadership; Mahathir didn't provide a source for that figure, although he noted that Malaysia fell four slots in the 2015 Transparency International corruption perception ranking from 50 to 54.

Najib's office didn't immediately respond to an email requesting comment.

In a statement emailed to CNBC, a Malaysian government spokesperson said: "Today, Tun Mahathir and his former enemies have demonstrated the depth of their political opportunism and desperation.

‎"There is an existing mechanism to change the Government and Prime Minister. It's called a general election. ‎And it is the only mechanism that is lawful, democratic and fulfils the people's will‎.

"In 2013, the Malaysian people expressed their will and elected the current government, led by Prime Minister Najib Razak. If Tun Mahathir wants to change the Government, he must follow democratic process and await the next election, in line with Malaysia's laws and Federal Constitution.‎"

Reuters also reported that opposition leader Anwar Ibrahim, who Mahathir removed as deputy prime minister in 1998, issued a statement from jail saying that he supported the push to remove Najib.

Najib has been under pressure since the Wall Street Journal published a report in July alleging that nearly $700 million had flowed from the 1Malaysia Development Berhad (1MDB) fund to Najib's personal bank account.

Najib has repeatedly denied wrong-doing and, under pressure from the WSJ report, said at the time the funds were a private donation from a Middle Eastern country he declined to name. In January, Malaysia's Attorney General Mohamed Apandi Ali told an unscheduled press conference that Saudi Arabia's royal family gave Najib a $681 million gift that was subsequently partially returned.

The announcement was an effort to end months of speculation about the source of the huge donation, with Apandi saying at the same press conference that no criminal offense had been committed, in a move that appeared to mark the end of the matter, at least within the country.

But investigators in two other countries disagreed, the WSJ reported, without disclosing the names of those countries.

The scale of the scandal could be larger than initially thought. Last month, the Wall Street Journal reported, citing global investigators familiar with the matter, that deposits into Najib's personal accounts exceeded $1 billion, with much of these funds being traced to 1MDB.

Outcry over the scandal has had wide-ranging political impact within the country.

Last week, Malaysia's United Malays National Organization (UMNO), which has been in power since the country's first election in 1959, suspended Muhyiddin Yassin, a deputy party president, citing his failure to support Najib. Muhyiddin had previously been fired by Najib from his position as deputy prime minister.

On Monday, Mahathir, who was prime minister from 1981-2003 said he would leave UMNO, claiming it is being seen as "supporting corruption" under Najib's leadership.

Follow CNBC International on Twitter and Facebook.