|
The prospect of a large capital outflow in September is another reason Mahathir might choose to go to the polls well before then. Opposition leaders are instructing supporters to prepare for just such a move in April. That is the last possible date for elections in the state of Sabah, which the government is expected to lose by a large margin. In isolation, such a defeat would reflect poorly on Mahathir and boost opposition morale, says Tian Chua, chairman of Gagasan Malaysia, a pro-democratic alliance of four main opposition parties and 20 nongovernmental organizations. But timing is everything. "If the economy starts to go down, then Mahathir will be trapped," says Tian. "He won't be able to sell himself as the one who has saved the economy."
Earlier this month, the Prime Minister postponed elections within his ruling United Malays National Organization until after the general polls. Neglecting a promise to let the members decide, Mahathir installed loyalist Abdullah Badawi as deputy president of the party (he automatically became Deputy Prime Minister). In so doing, the Prime Minister may have staved off a leadership challenge, but he has also upset the rank and file. "People are disappointed," confides an UMNO division chief. "The party should choose the leaders. Mahathir is like a drowning man, clinging to the last straw to stay afloat." Still, strong swimmers like Mahathir don't go under easily.
Tinkering With the Plan
Many predict Mahathir will start to relax some of the capital controls imposed last year
1. The ringgit is pegged to the dollar at 3.8
Forecast: No change likely soon
2. The ringgit is worthless outside Malaysia, and billions in foreign funds are frozen inside the country
Forecast: Liberalization this year
3. Bank interest rates are slashed
Forecast: No short-term change
4. Banks are obliged to lend widely for local projects
Forecast: More of the same
With reporting by Kim Gooi and David Yong/Kuala Lumpur and Ravi Velloor/Singapore
PAGE 1 | 2 | 3
|
|
