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Web-only Exclusives
November 30, 2000

From Our Correspondent: Hirohito and the War
A conversation with biographer Herbert Bix

From Our Correspondent: A Rough Road Ahead
Bad news for the Philippines - and some others

From Our Correspondent: Making Enemies
Indonesia needs friends. So why is it picking fights?

AsiaweekTimeAsia NowAsiaweek

MARCH 17, 2000 VOL. 26 NO. 10

The New Malay Dilemma
Why is the No. 2 tackling a sensitive issue?
By ARJUNA RANAWANA Kuala Lumpur

Could this be the normally cautious Abdullah Ahmad Badawi talking? "I would like to see affirmative action focus . . . on those bumiputras [Malays and other indigenous people] who genuinely need a headstart by way of income and opportunities," Malaysia's deputy prime minister told alumni of the Harvard Business School in Kuala Lumpur last month. "For those long mollycoddled by the state, their survival can only be measured in the arena of free competition." Suddenly, it seemed the former foreign minister, elevated to the nation's second most powerful post last year, was acknowledging that a favored few have been recipients of the state's largess - and now wants such favoritism stopped.

 
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The pundits waited for a response from Prime Minister Mahathir Mohamad, whose 1970 book The Malay Dilemma tackled the economic marginalization of Malays. "Malaysia, with its National Economic Policy [NEP] and privatization of industries to locals, was accused [by foreigners] of practicing cronyism, which subsequently led to the depreciation of the ringgit [during the 1997 Asian Crisis]," the PM told the Young Malay Professionals Congress a few days later. "All the economic progress for Malays brought about by the NEP and other efforts stalled. But such is the effectiveness of Western propaganda that even the Malays themselves want Malay businessmen . . . not to be assisted." The now-expired NEP - it has been replaced by the still pro-bumiputra National Development Policy - aimed to ease racial tension by setting targets for bumiputra employment, corporate ownership and other quotas.

Abdullah, who has called his ideas the new Malay dilemma, continued to complain that the favored bumiputra businessmen were crowding out their smaller counterparts. Mahathir has made no further comment and the issue has not fired up a national debate. Perhaps it is because everyone knows where Abdullah is coming from. The dominant political party UMNO will hold elections in the second week of May. Abdullah is running for deputy president, a post left empty when former deputy premier Anwar Ibrahim was jailed for abuse of power two years ago. "This sort of speech is very important at this stage of the UMNO campaign," says a party source. "Abdullah wants to be seen as addressing the more serious issues so he can appear to be presidential material."

"A few businessmen and companies [are perceived as winning] the plums," agrees Syed Husin Ali, head of the opposition Malaysian People's Party. "Particularly because of the Crisis, the smaller businesses are suffering. Abdullah wants to tap into that vein of dissatisfaction before any rival for the deputy's post such as Tengku Razaleigh Hamzah does." The UMNO supreme council wants Mahathir and Abdullah to run unopposed as party president and deputy president. But there are signs that Razaleigh, a Mahathir-ally-turned-foe-turned-friend-again, may challenge Abdullah - or Mahathir. Razaleigh, who was narrowly defeated by Mahathir for the presidency of the original UMNO party in 1987, headed the opposition Semangat 46 before that organization was dismantled in 1996. Razaleigh and most of its members have since joined the present UMNO.

Husin sees no conflict between Abdullah and Mathathir. "You will have them saying different things at different times to different audiences," he says. "They need to get all the support they can." But some wish Abdullah's words will turn out to be more than campaign rhetoric. He is voicing a very serious concern "that Malays are not competitive enough both in the local and global market place," says economist Charles Santiago. "Globalization will make the problem more pronounced. The government will not be able to favor bumiputra entrepreneurs under World Trade Organization guidelines." Santiago, who has links with the political opposition, blames UMNO's "practice of patronage" for weakening the Malay entrepreneurial spirit, "by providing everything to a select group of businessmen who are known not as bumiputras but as UMNO-putras." Mahathir denies his government is coddling a favored few. But he too has spoken up on occasion against the seeming inability of bumiputras to compete.

The question, says the PM, "is whether we have reached the level where we can drop the basics retained in the NEP. Are we confident of our capabilities, without the protection from a government which is sympathetic to us?" Abdullah has not said anything about social-equity schemes such as the high proportion of local and foreign university scholarships granted to bumiputras. No UMNO politician will dare touch these. The party saw a significant number of Malays switch support to the Islamist Pas in last year's parliamentary elections. The ruling UMNO-led coalition kept its two-thirds majority thanks largely to the ethnic Chinese vote.

Will UMNO move to address Abdullah's professed concerns? Santiago doubts it. Most UMNO division heads and members are businessmen who expect to get government contracts and concessions, he claims. Many may complain about making do with crumbs while the favorites enjoy big meals, but at the end of the day, no one wants to see the banquet end. "If the government finds the Malays less competitive, then it has to re-examine its own programs," argues social scientist Khoo Boo Teik. "There cannot be anything in the blood or the genes of any racial group that makes them less this or less that." Clearly, the country has to resolve the new Malay dilemma sooner rather than later.

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