Malaysia's Mahathir returns to swirl of issue
Malaysia's Mahathir returns to swirl of issue
By Reme Ahmad
KUALA LUMPUR (Reuter): A rested Malaysian Prime Minister
Mahathir Mohamad will have to deal with a swirl of issues on his
return next week from a two-month break, political and economic
analysts said.
From a slumping stock market and ringgit, beauty contestants
arrested for parading in bathing suits, to controversial plans
for the world's largest reclamation project, the premier will
have his plate full when he returns on July 22.
Also eagerly awaited are his answers to doubts over the $6.18
billion Bakun hydroelectric dam project and an ongoing crackdown
on corruption in high places.
But analysts said Mahathir was already in the know of things
as he has been in close touch with events back home, including
constant contact with Acting Prime Minister Anwar Ibrahim.
"It's always clear that on big issues Anwar will consult
Mahathir. That's why Mahathir is still around although his body
is not here," said opposition politician Syed Husin Ali.
Mahathir, 71, spent most of his holiday period in Europe,
resting and giving public speeches on one of his pet projects,
the Multimedia Super Corridor, an investment zone near Kuala
Lumpur which Malaysia hopes will attract high-technology firms.
His absence from May 19 is the longest holiday break Mahathir has
taken during his 16 years in power, leaving Anwar formally in
charge.
Analysts said Mahathir was not likely to vary much from the
positions already taken by Anwar on some of these issues.
"Of course they have their own personal styles, but that's as
far as it goes. In practically everything, they are like-minded,"
said Bunn Nagara, chairman of Geopolicy Research.
During Mahathir's absence, the stock market and the ringgit
have both slumped due to a regional currency turmoil following a
property and banking sector-driven economic crisis in Thailand.
The ringgit has plunged by 2.5 percent from May 19 to its
level of 2.5580/10 a dollar at the close of Kuala Lumpur trading
on Tuesday. The Composite Index of the Kuala Lumpur Stock
Exchange has skidded by 2.78 percent to 1.012.48 points.
Analysts said Malaysia will have to decide where the ringgit
should be to match the competitive advantage gained by Thailand
and the Philippines from the de facto devaluations of their
currencies. Similarly, interest rates would also have to
stabilize after rising sharply due to the currency problems.
"Right now, people are concerned with how far the ringgit will
depreciate to maintain competitiveness, and whether interest
rates will remain high," said Derrick Lee, senior analyst at
market analysis firm Technical Data.
The issue of religious tolerance came to the fore last month,
when Moslem authorities in Selangor state arrested three Moslem
women who paraded in bathing suits at a beauty pageant.
How Mahathir will react to plans to build an international
airport on the world's largest land reclamation project in
northern Kedah state will also be watched.
The $12 billion sea reclamation plan involving 16,300 hectares
(40,277 acres) raised eyebrows due to its grandiose scale, its
financing and its necessity.
"Do we need to reclaim land when we could have done it on
land? And how do we finance such a huge project?" asked the chief
economist at a foreign investment house.
Anwar on Tuesday announced that the $6.18 billion Bakun
hydroelectric dam in the jungles of Borneo, may be delayed due to
differences between the project's two main contractors. The
project is strongly backed by Mahathir.
Yet another issue is an apparent slowdown in the government
anti-corruption drive after a strong start, analysts said.
Pronouncements by the powerful premier are often accepted as the
final word on any issues.
"His word is the law...that seems to be the impression," said
politician Syed Husin.