Mahathir outmaneuvers a united opposition

By Simon Martin

KUALA LUMPUR (AFP): In characteristically pugnacious vein, Prime Minister Mahathir Mohamad set the tone for 1999 with a new year warning to Malaysians to beware of attempts to recolonize the country.

Under attack over the sacking and jailing of his former heir apparent Anwar Ibrahim and his controversial capital controls, Mahathir derided foreign critics as "just like cockerels crowing arrogantly but with the tailfeathers mired in faeces."

"Let them crow. It is us the Malaysian people, the Malaysian nation, that will determine our recovery in the decent way," he said.

Almost one year later, most analysts agree that Asia's longest serving elected leader -- whose theme tune is My Way -- can himself afford to crow modestly.

Analysts cannot agree whether the economy is recovering because of, or in spite of, capital controls. But politically Mahathir has seen off an election challenge from a united opposition and is firmly in control of his party in his last term in office.

What is uncertain is who will step into his shoes and how much lasting damage the Anwar affair has done to national institutions.

In January the national police chief quit to take responsibility for the black eye Anwar suffered in custody. Abdul Rahim Noor admitted he personally assaulted Anwar and will face trial next year.

Conservative Malay Muslims were also shocked by evidence from Anwar's trial of semen-stained mattresses and other graphic sexual testimony.

Anwar, who said he was the victim of a top-level political conspiracy, was jailed on April 14 for six years for abusing his official powers to cover up allegations of sexual misconduct.

Water cannon were used against street protests and human rights groups and foreign critics slammed the verdict.

On April 27 Anwar was back in court to face a charge of sodomy, for which he is still on trial. Earlier that month his wife Wan Azizah Wan Ismail launched the National Justice Party.

Mahathir, who in January named Abdullah Ahmad Badawi as his new deputy, won overwhelming support from his United Malays National Organization (UMNO) in June after attacking Anwar as a tool of foreign forces.

But prison controversies continued. In August former opposition parliamentarian Lim Guan Eng was freed after serving one year for sedition. He had questioned the handling of a statutory rape case allegedly involving a government politician.

In September, Canadian journalist Murray Hiebert went to jail for a month for contempt of court over an article he wrote.

Capital controls were eased in February and in September. Mahathir insisted they would stay, saying the economy was still under threat from foreign speculators.

Despite the recession some "mega-projects" went ahead. On June 21 the premier moved to the new administrative capital of Putrajaya and the following month launched a high-tech city at Cyberjaya.

Some projects proved spectacular successes, like Malaysia's first Formula One grand prix in October.

In August the economic gloom lifted. The central bank announced second-quarter growth of 4.1 percent year-on-year and declared the recession over after five quarters of shrinkage. Capital controls won some influential endorsements.

Election speculation dominated much of the year but Mahathir still caught the country napping when he set the date for November.

The opposition mounted its most determined challenge ever. The four-party Alternative Front vowed to take away the National Front's two-thirds majority.

After a relentless campaign Mahathir's coalition took 148 of 193 seats, but its vote share fell to 56.5 percent from 65 percent in 1995 and its dominant party UMNO lost 16 seats.

The Parti Islam SeMalaysia (PAS) and not its secular opposition allies was the biggest beneficiary of ethnic Malay discontent over Anwar and other issues.

Even so, politically the year was a success for Mahathir, said Nizam Idris, regional economist with IDEA in Singapore..

"He's done what many thought he couldn't, outmaneuvered a united opposition."

But Nizam said the jury was still out on whether the economy would have recovered faster without capital controls and if Mahathir had accepted International Monetary Fund assistance.

Bruce Gale, of the Political and Economic Risk Consultancy in Singapore, sees Mahathir becoming "increasingly isolated, even in his own party.

"People will not attack him directly and will still express loyalty but that's about it."

Two men touted as potential successors -- defense minister Najib Tun Razak and Tengku Razaleigh Hamzah -- would probably take on issues Anwar raised like corruption and nepotism to try to undermine Mahathir, he said.