Malaysia: Will Mahathir follow Suharto?

October 7, 1998
Issue 

By Max Lane

The widespread protests against the Malaysian prime minister Mahathir Mohammad's sacking of deputy prime minister Anwar Ibrahim have revealed an unexpected depth of discontent among urban Malay youth and professionals.

Twice during the last fortnight more than 50,000 Anwar supporters have mobilised (some press reports put the figure at 100,000 each time). Several smaller mobilisations have also occurred, either at Anwar's house, at mosques or in the main square near the central courts.

Anwar also organised rallies in other Malaysian cities before he was arrested and took the opportunities created by his court appearances on September 30 and October 1 to urge his followers to continue their protests.

Internal conflict

UMNO is the dominant party in the National Front coalition which currently rules Malaysia. The street protests are a rebellion by an important section of the UMNO support base against Mahathir's leadership.

At the centre of the trouble is a conflict between Anwar and Mahathir for control of UMNO. This conflict between two factions of the Malay section of the ruling elite has coincided with the emergence of an issue which has generated deep discontent among the urban Malaysian population, Malays, Chinese, Indian and others.

During the last decade of economic boom in Malaysia, a high profile group of big capitalists emerged as Mahathir's cronies. Initially, UMNO's use of the state to "economically" advance the position of Malays was popularly viewed as a policy of affirmative action.

British colonial policy had restricted Malays to villages, using mainly immigrant Chinese labour in the cities and mines. This facilitated the development of an ethnic Chinese merchant and shopkeeper strata. With independence from Britain in 1957, the majority of Malays felt economically disadvantaged compared to the urban Chinese.

In fact, Chinese town labourers were also severely exploited and Chinese business was secondary to British capital.

While the need for affirmative action for Malays was used to justify state intervention in business affairs, the intervention was actually used to facilitate the growth of a small group of businesses closely associated with Mahathir.

In recent years, Anwar and another key UMNO cabinet minister, Daim Zainuddin, have facilitated the business activities of their friends, but they lag behind Mahathir.

Cronyism

Even before economic crisis hit Malaysia last year, issues had emerged which focused attention on cronyism.

For example, concern has been expressed by some groups for several years about the environmental impact of the planned Bakun dam. Public opposition to the damn has, however, extended beyond environmental issues because it is to be built by construction millionaire Ting Pek Khiing.

Ting had no experience in dam building, but won Mahathir's favour, and the multi-million-dollar dam project, after building a hotel on Mahathir's favourite holiday island in record time.

Another powerful operator, Francis Yeoh of YTL Corporation, built schools and hospitals in remote Third World countries, often at marginal profits, because Mahathir was pushing South-South cooperation. Yeoh subsequently won the contract for Malaysia's biggest non-government power plant.

This cronyism extends to Mahathir's family, with his son, Mizzen Mahathir, involved in business deals with former Indonesian president Suharto's daughter, Tutut.

There are many other ties between Malaysian capital and Suharto's cronies. These links are well known in the population.

Since the economic crisis hit, the cronyism has been highlighted by a number of well publicised bailouts of government owned or crony companies. These bailouts occurred just as unemployment started to increase.

Even Mahathir's currency control policies are intended to operate as bailout mechanisms for the country's largest companies. By defending the Malaysian ringgit, these policies ensure that the ringgit value of the cronies' foreign debt does not blow out.

Anwar's greatest crime, in Mahathir's eyes, was not any dispute over macro-economic policies, but his public criticism of cronyism, more specifically Mahathir's cronies.

Mahathir projects himself as nationalist, as opposed to Anwar's closeness to the International Monetary Fund and the World Bank.

The real difference, however, is that Mahathir's cronies are the huge operators needing the desperately big bailouts. Foreign capital is quite happy to see these operators falter and the dollar value of their (potentially purchasable) assets decline.

Neither Mahathir nor Anwar have expressed any interest in anti-austerity policies.

The crony issue has injected into the Mahathir-Anwar squabble a broader alienation that has developed in UMNO's popular base. Never before have 100,000 Malays mobilised on the street accusing a Malay prime minister of being a dictator and being guilty of cronyism.

In the past, UMNO's base has almost always been mobilised only to defend the position of Malays vis-a-vis Chinese. The current politicisation of Malays beyond the Malay rights framework has enormous implications for Malaysian politics.

The demonstrators in Kuala Lumpur have borrowed the slogan "Reformasi!" (Reform!) from Indonesia. The content of this demand in Malaysia initially centred on ending cronyism and releasing Anwar. The arrest of Anwar supporters under the repressive Internal Security Act, and the physical assault of Anwar while he was imprisoned, broadened the demands to include the repeal of the ISA.

Broader opposition

While the issues of cronyism and the ISA are injecting a new dimension to mass politics in Malaysia, the UMNO base's revolt is still isolated from other opposition forces.

The three most important of these are the conservative Islamic opposition represented by the Islamic Party (PAS), based in north Malaysia; the social democratic Democratic Action Party, based in the Chinese community; and the progressive democratic opposition, comprising the Malaysian People's Party (PRM), the human rights advocacy organisation, Malaysian People's Voice (SUARAM) and several other NGOs.

All these organisations have for years called for the repeal of the ISA, the restoration of the independence of the judiciary and an end to cronyism. They regularly work together in ad hoc coalitions.

In response to the protests against Anwar's arrest, two such coalitions were formed. Gerak was initiated by PAS and covers the full spectrum of opposition forces. The second, the Campaign for Popular Democracy, has PRM and SUARAM at its core but also includes a broad range of oppositionists.

The four basic components of mass protest remain isolated from each other. Discontented UMNO supporters; discontented members of the Chinese community; the socially conservative Malays of northern Malaysia; and the progressive milieu do not coordinate their political activity.

Nevertheless, the emergence of active opposition to cronyism and authoritarianism among the Malay support base of UMNO is the first significant crack in the racial framework of Malaysian politics. This opens up the prospects for a more dynamic, non-racial progressive opposition.

It is not surprising that the first arrests after Anwar began to resist his dismissal were of central leaders of the UMNO youth organisation and another Islamic youth organisation, THE Malaysian Moslem Youth Movement (ABIM). Anwar was once an activist in ABIM and has maintained close relations with the organisation. It recruits mainly tertiary educated Malay Moslems and carries out by social welfare and religious welfare issues.

Since the first arrests, action has also been taken against SUARAM and PRM. On September 28, police ordered the dispersal of a public meeting organised by the PRM in Malaysia's second largest city, Johore Baru.

A thousand people attended the meeting, despite police barricades in the vicinity. Water cannon trucks were reported to be parked nearby and the police prevented PRM president Syed Husin Ali from addressing the meeting.

On September 30, SUARAM activist Tien Chua was arrested while observing a pro-Anwar demonstration. He was later released on bail.

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