Malaysia’s relations with the United States (US) and China under Najib Razak’s administration have been critically associated with the 1MDB controversy. This article seeks an answer to three questions: what is the relationship between 1MDB as a national strategic development fund with Malaysia’s foreign policy? To what extent Najib Razak strengthened Malaysia’s relations with the US and China when both powers offered benefits to 1MDB? To what extent Najib weakened Malaysia’s relations with the US and China when those powers exert their pressures on 1MDB?. Foreign Policy Analysis (FPA) framework is employed due to its capability to explain the impact of a national strategic development fund such as 1MDB on Malaysia’s foreign policy. However, FPA needs to be coupled with neoclassical realism (NCR) theory to illuminate the risks and rewards offered by the US and China against the interests of 1MDB. This article adopts a qualitative approach of focused case study – to investigate whether the variation in Malaysia’s foreign policy toward the US and China correspond with variation in the selected causal variables. In order to analyze the data systematically, three procedures involved: inquiry on the relations between the US and China with 1MDB; inquiry on Malaysia’s foreign policy toward the US and China when those powers offers benefits to 1MDB; and the inquiry on Malaysia’s foreign policy toward the US and China when those powers exert their pressures upon the 1MDB’s interests. This study concludes by highlighting its core findings that both the US and China indeed offer distinctive rewards and risks to the interests of 1MDB. There is also a significant correlation between the strengthening as well as weakening in Najib Razak’s foreign policy toward the US and China with the 1MDB interests’ calculation.
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