Dr M blasts Abdullah over IDR rules

Dr M blasts Abdullah over IDR rules

AFTER five months of relative quiet, former Malaysian prime minister Mahathir Mohamad returned to the offensive, this time attacking Prime Minister Abdullah Ahmad Badawi's plan to relax laws governing investment in the Iskandar Development Region (IDR) in southern Johor state.

In a speech before 300-odd supporters in Kulai, a rural hamlet in Johor, the 81-year-old Dr Mahathir lambasted Mr Abdullah in familiar fashion, accusing the premier of weakness, economic mismanagement and outright corruption. All that was old hat but the IDR was new ground.

Last week, Mr Abdullah decreed that investors in the IDR would be exempted from Foreign Investment Committee (FIC) rules which include the requirement that ethnic Malays must be accorded 30 per cent in all spheres of economic activity in Malaysia from employment to equity participation.

Instead, Mr Abdullah said that investors - both local and foreign - would enjoy FIC exemptions within five zones within the IDR that could engage in selected activities from health care to tourism. The IDR is Malaysia's most ambitious project yet with an estimated US$105 billion set to transform a region almost three times the size of Singapore into a super-economic zone over 15 years.

The Malays form the majority of Malaysia's population and have enjoyed special privileges over three decades to uplift them economically. Mr Abdullah's shift in tack thus represented economic sacrilege and the former premier seized the opportunity.

Dr Mahathir, who rose in politics as an out and out Malay nationalist, said that such a policy would not make Malaysia 'our country at all', implying, as his wont, that it was a sell-out to foreigners. 'The Malays will lose out,' Dr Mahathir said. 'They are not ready to compete with those (businessmen) who will come into the IDR. . . We will be enslaved again.'

It is not clear if Dr Mahathir's clarion call will resonate among ordinary Malays given the fact that Mr Abdullah's announcement had been cleared by the country's Cabinet, which is chaired by the Premier himself. Nor is there any reason to believe that Mr Abdullah would reverse tack given his former boss's outburst. But there is no doubt that there is genuine disquiet among some segments of the Malay community which fear being marginalised in out and out competition.

Former deputy premier Musa Hitam, for example, was slammed over the Internet after he suggested on March 22 that the IDR be exempted from affirmative action policies. Mr Musa made the remarks in his capacity as an adviser to the IDR but got branded as a 'traitor' by Malay commentators on the Internet. Without explicitly naming him, Dr Mahathir also referred critically to the comments made by Mr Musa, who resigned as his deputy in 1985. Mr Musa declined to comment when contacted by BT.

Ironically, it was Dr Mahathir who first started relaxing affirmative action policies. In 1986, he repealed portions of the policy and allowed foreigners to own 100 per cent of businesses provided it was meant for export. It led to a decade-long boom of the Malaysian economy. The exemption still holds today.

In the early 1990s, Dr Mahathir almost completely waived affirmative action policies throughout his Multimedia Super-Corridor, an area of land much larger than the five zones selected by Mr Abdullah in the IDR, and meant to be the Malaysian equivalent of California's Silicon Valley.

The rules still exist today and the project is a qualified success. For all that, however, the former premier seems to bitterly rue his choice of Mr Abdullah as his successor and seems hell bent on toppling him. But age seemed to be slowing him down.

Late last year, Dr Mahathir suffered a heart attack and doctors advised him to cut back on his schedule. He did - for nearly five months.