Succession obsession gives Malaysia's UMNO heartburn

Succession obsession gives Malaysia's UMNO heartburn

By Simon Cameron-Moore

KUALA LUMPUR (Reuters): Malaysian Prime Minister Mahathir
Mohamad's decision to fill the vacant finance minister post
himself is at first glance hardly a sign Asia's longest serving
leader plans to give up high office any time soon.

Next month Mahathir celebrates 20 years in charge, but the 75-
year-old premier does not seem to be winding down.

Unable to find a ready-made successor to Daim Zainuddin, who
quit last Friday after informing the prime minister privately two
months ago he wanted to resign, Mahathir announced on Tuesday
evening he would do the job himself for the time being.

Malaysians, members of Mahathir's own United Malays National
Organization (UMNO), and foreign investors are waiting for the
day when he calls it quits, some with dread, others with relief.
Mahathir has said this is his last term, and that he will not
serve after elections due in 2004, but there has been speculation
he will step down beforehand.

No one is holding their breath after his decision not to give
the second-most powerful job in Malaysia to anyone else just yet.

A senior UMNO Youth member said he doubted the premier
intended to step down just yet.

"Is he leaving or isn't he? If he is, he really should have
put everyone in place. If you ask me I think he's going to stay."

A Kuala Lumpur-based political analyst, who requested
anonymity, agreed.

"Undeniably he's on the last leg. He can't go beyond 80, but I
don't think he's going to step down.

"If he'd appointed an aspirant (to succeed him) or a
politician not allied to him then it would have appeared that he
was getting ready to go."

But political pundits have been foxed by the mercurial,
sometimes emotional Mahathir's capacity to surprise before.

Meantime, Deputy Prime Minister Abdullah Badawi, Mahathir's
chosen a successor, can only wait.

And while UMNO's three vice-presidents -- Najib Tun Razak,
Muhyiddin Yassin and Muhammad Muhammad Taib -- jockey for
position, a dark horse is circling the ring.

Razaleigh Hamzah, a Malay royal who once split from UMNO after
unsuccessfully challenging Mahathir in the late 1980s, has
recently built bridges with the premier, making him one to watch,
according to analysts and party insiders.

UMNO's general assembly, on June 21-24, will test the party's
mood. Analysts say the last thing UMNO needs is in-fighting, with
the Islamic opposition sucking away more Malay votes.

Supreme Council member Shahrir Samad, a frequent Mahathir
critic, advised not to expect any fireworks in the form of
confidence motions or pressure on the prime minister to appoint a
full time finance minister.

"Believe you me, we don't operate that way. There will be some
voices expressing issues close to the Malay community," Shahrir
told Reuters.

He said the fixation with the succession issue was diverting
UMNO's energies away from making it more acceptable to voters and
the need to stamp out money politics in its ranks.

But the withdrawal of Mahathir's son, Mokhzani, from the
business world in April, and Daim's unexplained resignation
sparked some talk Mahathir's end-game had been set in train.

Mahathir has taken charge of finance before, after the sacking
and jailing of his erstwhile deputy, Anwar Ibrahim, at the height
of the Asian crisis in 1998.

At that time he controversially brought in capital controls
and fixed the exchange rate at 3.8 ringgit to the dollar.

The policy seemed to work, protecting the banking system and
generating export-led growth, so that Malaysia bounced back more
strongly than most of its neighbors.

But now Mahathir is seen as wedded to the idea of exchange
controls and the currency peg, and there are concerns that the
prime minister may not recognize when policy changes are needed.

Whatever Daim's faults were, his counterbalance to a strong-
minded premier on policy is now missing, analysts say.