Dr M takes opposing stand to Najib’s policies

(Singapore Business Times) KUALA LUMPUR, July 22 — In a posting on his blog late Monday, former premier Tun Dr Mahathir Mohamad appeared to criticise Prime Minister Datuk Seri Najib Razak's economic liberalisation by coming out with a spirited defence of the country's affirmative action policies and claiming that the non-Malays, particularly the Chinese, were the real masters of the country.

Since he took over as premier in early April, Najib has begun rolling back affirmative action for the Malays, who form the country's majority, to boost investment and make Malaysia more competitive. The programme, known as the New Economic Policy (NEP), uses quotas, licences, restrictions and outright grants to lift the Malays into economic parity with the non-Malays.

In so doing, however, he has angered many Malays who have felt betrayed over his policy reversals and worried about falling further behind their richer countrymen.

In quick succession, Najib removed NEP restrictions from 27 service sub-sectors, liberalised financial services, and emasculated the Foreign Investment Committee, a powerful state body that could block deals if it felt that Malay interests were not being served. He also removed a decades-old requirement that mandated 30 per cent of an initial public offering's shares to be set aside for Malay interests.

More recently, Najib announced the setting up of a merit-based scholarship programme in what seemed to be an effort to appease the non-Malays who have long complained about being victimised.

While Najib's efforts have been generally lauded by analysts and investors, the more right-wing Malays have largely perceived it as a capitulation by Najib to non-Malay demands following the disastrous showing of his ruling Barisan Nasional coalition in the last general election. The worry for Najib's allies is that Dr Mahathir's comments could provoke nationalist objections to Najib's reforms.

This is no idle threat. Dr Mahathir, 83, wields considerable influence in Umno, the political party over which Najib presides. And the former premier was largely responsible for cutting short the tenure of Najib's predecessor, Tun Abdullah Ahmad Badawi.

The former premier argued that 39 years after the NEP was introduced, the ethnic Malay share of the corporate pie remained at 20 per cent while the Chinese share was at 50 per cent although they consisted of only 26 per cent of the population. The Malays make up 64 per cent of Malaysia's 26 million people.

“The Bumiputera property holdings are only 15 per cent while the rest are held by non-Bumiputeras because urban property is worth more than rural property,” wrote Dr Mahathir.

“If they are honest, non-Malay leaders who put themselves in the shoes of the Malays will feel the disappointment of the Malays in seeing nearly all business and industry in the hands of the non-Malays,” said Dr Mahathir.

This is the second time Dr Mahathir has spoken out against government policy. A week ago, the combative former physician lambasted Kuala Lumpur's directive of stopping the teaching of science and mathematics in English and reverting to Bahasa Malaysia instead. Dr Mahathir had imposed the English ruling during his tenure.