From The Economist Issue 16-22th September 2000

Mahathir?s last waltz?

The choice facing Malaysia's long-serving leader

Snubbed by the Islamists

HAS Mahathir Mohamad, Malaysia's long-serving and successful prime minister, become a liability for his party and his country? It is a question that would not have seemed worth putting until quite recently. During Dr Mahathir's 19 years in office, Malaysia's mixed-race community has prospered in an atmosphere of general harmony. He won a thumping victory in last November's general election, and in May, to the surprise of some commentators, he waltzed off, again, with the leadership of UMNO, the United Malays National Organisation, the main party in the ruling coalition. A good dance for a man of 74 years.

But senior members of his ruling council whisper that the old man too often puts his feet wrong. He should go-if only there were a suitable successor. That election result in November, despite UMNO's success, flagged up growing concern among the majority ethnic Malays that the government's rule is corrupt and ill-judged. The trial and jailing of a former deputy prime minister, Anwar Ibrahim, upset many Malaysians who believed that it was his criticism of Dr Mahathir that had cost him his freedom. An opposition Malay Islamic party, PAS, increased its support in the north, traditionally Mahathir territory, and took control of the state of Terengganu.

Dr Mahathir is, of course, aware of the drift of support away from his party. On September 11th he said he would hand over some of his more ceremonial tasks to a deputy. He would now spend more time restoring the party's popularity, especially among young people. The shift might also, he implied, smooth the path of succession, when the time comes. That may be less than candid. The last time Dr Mahathir spoke of giving more responsibility to his deputy prime minister, that job was held by Mr Anwar. Still, his decision to rally the party is a wise one. He remains Malaysia's most charismatic politician.

Less wise was a fierce attack on his critics in a speech for the country's independence day last month. Dr Mahathir said that those who opposed his policy of favouring ethnic Malays over ethnic Chinese (such as in the allocation of school and university places, and in access to government jobs) were "extremists". The critics he apparently had in mind were a number of Chinese groups and an opposition party led by Mr Anwar's wife. Dr Mahathir said they risked stirring up racial unrest which could "engulf us all"-a reference to race riots 31 years ago.

But it is the doctor, not the Chinese, who is making race an issue. Malay gripes against wealthy Chinese are common. The Chinese are believed to own about half the country's wealth, but account for about a quarter of the population. By pandering to prejudice Dr Mahathir may win back a few Malays, but he risks losing support from previously mainly loyal Chinese. The Malaysian Chinese Association sits in the ruling coalition. If it withdrew, the coalition would clearly be weaker and narrower.

Then there are the Islamists. Malaysia is formally an Islamic country, but PAS wants it to be more so. It won Terengganu partly because voters were impressed by its honest record in neighbouring Kelantan state, where it has been in power for ten years. The federal government is smarting over this snub and is seeking to limit PAS's power in Terengganu. On September 5th the government said it would "redirect" money from oil revenues which had, since the 1970s, passed through the state?s hands. Oil royalties worth 810m ringgit ($213m) were due to be paid to Terengganu this year by the national oil company, Petronas, reflecting 5% of the value of oil and gas extracted offshore from the state. Instead, the federal government will decide how to spend the cash in the state, to the outrage of opposition parties. They say the decision is a political one, to restrict Terengganu's income now that it is under Islamic control.

Meanwhile, other Malay Muslim "extremists" appeared on trial this week: 29 members of the Al-Ma?unah cult have been accused of treason, which carries a death sentence. The cultists, said to specialise in massage, martial arts and exorcising spirits, are accused of raiding two military weapons stores in July and taking (and killing) hostages. If found guilty, their acts would appear to support Dr Mahathir's warnings about Islamic extremists, but there is such public cynicism towards the government and the courts that many doubt the official version of events. The army recently staged a "reconstruction" of its stand-off with the cultists. The effort was ridiculed by, among others, Lee Kuan Yew, Singapore?s former prime minister, who in August had also chided Dr Mahathir for "several errors of judgment" over the trial of Mr Anwar.

Some commentators fear that if Dr Mahathir is unable to regain the support he once enjoyed, he may decide to crack down on opposition politicans and the press, blaming them for his unpopularity. On the other hand, he may decide to bow out gracefully, rather than become yet another politician whose career ends in disappointment.