Twin Shocks Will Leave Their Mark on Malaysia 
International Herald Tribune
September 23, 1998
Philip Bowring 

The detention of Anwar Ibrahim in Malaysia, until recently deputy prime minister and heir-apparent to Mahathir bin Mohamad, is the most important event in that nation's history since the race riots of May 1969 and could leave an equally indelible mark.

No amount of historical "perspective," which some Malaysians would bring up to play down the event, can change this view.

The arrest has come in the aftermath of an almost equally dramatic shift in economic policy, partly closing one of the world's most open, trade-oriented economies.

Together, these shocks jeopardize Malaysia's position as an exemplary developing economy; its reputation for political stability, and its standing in the Islamic world as a role model for a progressive and plural society governed by laws, elections and institutions — not one subject to the whims of autocrats.

There is nothing new in Malaysia about using the Internal Security Act to silence mainstream — not to mention fringe — political opponents. It was used in 1987, mainly against the mostly Chinese opposition Democratic Action Party, and in the 1970s against several ranking members of the United Malays National Organization who were improbably alleged to be Communists. Nor is there anything new in Malaysia about power struggles in the party that rely on slanderous rumors and poison pen letters.

Mr. Mahathir emerged victorious from two such battles in the late 1980s, against a former finance minister, Razaleigh Hamzah, and against Musa bin Hitam, who was the first of his deputy prime ministers.

But this is the first time that the Internal Security Act and criminal allegations have been wielded in a struggle among the party elite. It is also the first time that such a struggle has spilled onto the streets, and the first time that non-Malays — who make up 45 percent of the population — have felt much affected by the governing party's feuds.

The street involvement by Malays and non-Malays is not necessarily out of love for Mr. Anwar. True, he has wide grass-roots Malay backing at home, and overseas he is admired for his eloquent espousal of liberal Muslim values as well as his support for an open economy.

But many non-Malays have long viewed him with misgivings because of his Muslim base and his intellectual — rather than commercial — background.

His ideas and eloquence have not been matched by his achievements as an administrator. His appeals for reform and his criticisms of crony capitalism are hard to square with some of his own actions and associates.

But Malaysians of all races have been alarmed by the extreme methods used against someone who until recently was presented as Mr. Mahathir's chosen successor.

The confessions of two colleagues of Mr. Anwar to having been sodomized by him are widely viewed as show trials.

Fear and tear gas were not a normal part of Malaysian politics. They are now. The abuse of state power is seen in Malaysia as more akin to a Latin American than a Malaysian past.

Malaysia's ability to provide smooth successions has now been jeopardized. So has its economy.

Malaysia entered the Asian economic crisis in better shape than its neighbors. It had much less foreign debt and a flexible currency regime. But a series of overreactions leave it facing a much longer recovery than Thailand.

In the past, Mr. Mahathir's always forceful positions and street fighting talents have mostly served him and the nation well. He provided a dynamism that, he claimed, gentlemanly Malay rulers often lacked.

The medical doctor son of an Indian Muslim immigrant, he could be more Malay than the Malays. His book "The Malay Dilemma," banned by his predecessors, contained some curious racial theories and was viewed as insulting by some Malays.

Expelled from United Malay National Organization in 1969, he came back to lead it through energy and force of personality. His own realism and Malaysian party and state institutions provided a check to some of his more extreme instincts. But at age 73 his judgments look increasingly dubious, if not vindictive. After 17 years at the top, his personal authority has also got the better of the checks and balances built into Malaysia's federal structure and bureaucratic system.

Malaysians are now seeing why Indonesians have long referred to Mr. Mahathir as a "mini-Sukarno."

Mr. Anwar's immediate prospects are poor. He is out of the United Malay National Organization and, Mr. Mahathir has a firm grip on the party's hierarchical structure.

Continuous rallies in Mr. Anwar's favor seem unlikely. Kuala Lumpur's low-density population and middle class attitudes work against street action. However much Malays may dislike one of their leaders, they are averse to any action that make it seem they are divided among themselves.

All the races worry about mass rallies that might shift the focus from Mr. Anwar to race, or be used to justify a broader use of Internal Security Act powers.

Mr. Mahathir himself looks secure enough for now. But the succession issue is wider open than ever. By disposing of Mr. Anwar so brutally, Mr. Mahathir has reminded people that Mr. Anwar has a far more grass-roots support — and from a younger generation — than do any of the other aspirants to the succession.

The strong reaction to the arrest of Mr. Anwar suggests that his popularity is unlikely to be erased by the lurid allegations against him. Indeed, they may have raised his status to a more heroic plane.

Whatever the circumstances of Mr. Mahathir's eventual departure, his successor is unlikely to inherit his dominance of the party. An election is not due for two years, but otherwise time is not on Mr. Mahathir's side.

Much will now depend on the economy. With capital controls, Mr. Mahathir has wrapped himself in a mantle of economic nationalism.

This should provide a short-term boost to the economy and the stock market. But if recovery is not sustained, more Malaysians will see the controls as having been aimed at protecting crony capitalists from market forces than at protecting Malaysia from foreign marauders.

To an outsider it may seem strange that the twin shocks of Mr. Anwar's ouster and the capital controls are linked. But they show how closely business and politics in Malaysia have become connected. The economic and political situations seem set to continue to feed on each other to the detriment of both.

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