Prime Minister Najib Razak's decision to pour what could be upwards of US$24 billion (S$32.4 billion) of state funds into the United States has received brickbats back home, with critics saying the money should be used to improve Malaysia's economy instead.
Much of the funds will be spent on a US$10 billion deal for Malaysia Airlines to buy up to 58 jets from Boeing.
What has drawn flak, however, is Datuk Seri Najib's directive to the Employees Provident Fund (EPF) to invest up to US$4 billion in US infrastructure, raising the question of whether the premier has abused his position by pre-empting the world's seventh-largest sovereign pension fund's stringent investment approvals process.
"Money held by the EPF is money held in trust for the public and cannot be used indiscriminately," said Selangor Menteri Besar Azmin Ali, whose colleagues in the opposition likened Mr Najib's pledges to tributes paid by a vassal state.
However, the EPF Act allows the minister in charge - that is Mr Najib, who is also Finance Minister - to give "directions of a general nature... as to the exercise of the functions and powers of the board".
All members of the EPF board and its powerful investment panel - which recommends where to put the EPF's RM747 billion (S$239.9 billion) - are appointed by the minister.
Total EPF funds.
Number of EPF members.
PM Najib Razak's directive to the EPF to invest up to US$4 billion (S$5.4 billion) in US infrastructure has drawn flak.
Proportion of the EPF's assets invested overseas, contributing to 37 per cent of its income.
The EPF issued a statement on Tuesday that 29 per cent of its assets were invested overseas, and contributed to 37 per cent of its income, meaning they outperformed the fund's local investments.
"The US is one of the key markets within the EPF's investment universe given its size and depth. As a retirement fund, the EPF ensures that every investment proposal goes through a stringent risk assessment and robust due diligence process to protect the interests of its 14 million members," it said.
The EPF is a compulsory pension fund for Malaysian private-sector employees, who have received dividends ranging from 4.25 per cent to 8.5 per cent per year on their savings since 1983. All members can withdraw their entire savings at age 55. Mr Najib insisted that the EPF's existing US$7 billion in the US has given good returns. "We are talking about export of capital that brings healthy returns. It is not a one-way street," he said yesterday.
But the EPF's previous forays overseas have not been announced during Mr Najib's own travels, spooking some Malaysians worried about their pensions being diverted for political purposes.
Meanwhile on social media, netizens posted pictures of hospital queues, and asked why the money could not be used to improve local infrastructure instead.
Financial experts think the move will pay off for Malaysian workers. "The EPF board is highly professional. It doesn't matter if it was directed by the Prime Minister. EPF would approve it only if it is good," said Manulife Wealth Advisors group agency leader Victor Liew.
Political analysts believe a big local investment will cool criticism of Mr Najib's announcement, which S. Rajaratnam School of International Studies' senior fellow Johan Saravanamuttu said made him appear "too ready to please (US President Donald) Trump".
"Raising the EPF's dividend rate this year would also signal that the government knows what it is doing," said Asian Strategy & Leadership Institute's senior international affairs adviser Oh Ei Sun.