WORLD

Big and booming

A new ‘tiger’ hopes to lead the Muslim world

MICHAEL STEINBERGER March 24 1997
WORLD

Big and booming

A new ‘tiger’ hopes to lead the Muslim world

MICHAEL STEINBERGER March 24 1997

Big and booming

WORLD

MALAYSIA

MICHAEL STEINBERGER

A new ‘tiger’ hopes to lead the Muslim world

Malaysian Prime Minister Mahathir Mohamad likes to think big. The nation’s capital, Kuala Lumpur, now has a $1.6-billion monument to prove it. With special care given to ensure that every square inch conforms to Islamic standards, the finishing touches are being applied to the Petronas Towers, twin 452-m glass-and-steel structures that awkwardly dominate the city’s blossoming skyline.

Named for the state-owned oil company, the Petronas complex has replaced the Sears Tower in Chicago as the world’s tallest building.

That was the idea. Officials admit that the cylindrical skyscrapers, joined at the hip by a 57-m bridge, are as much a political statement as an architectural feat.

The message to the world:

Malaysia—once an exotic tropical backwater, the setting for gin-laced Somerset Maugham stories—has arrived.

After nearly a decade of fast-paced growth, the former British colony has established itself as one of East Asia’s most dynamic “tiger” economies. And that is only the beginning for the 71-year-old Mahathir. The prime minister, a stern taskmaster, calls his grand scheme Vision 2020. By that year, he wants Malaysia to become a fully industrialized nation. Even then, material progress is only a means to an end for Mahathir. He and his heir apparent, Deputy Prime Minister Anwar Ibrahim, think Malaysia stands at the crossroads of two trends that will do much to shape the next century: the rise of Asia and the spread of Islam. History is moving their way and they want their nearly 20 million compatriots to embrace it. From the Petronas Towers to the capital’s new international airport (which will be the most modern in southeast Asia when it opens next year) to a 750square-km “multimedia super-corridor” that may soon be home to some of the world’s top media and information technology firms, Malaysia is making no secret of its global ambitions. Increasingly, the world, including Canada, is beating a path to its door.

But not everyone is impressed. Lim Guan Eng, deputy chief of the opposition Democ-

ratic Action Party, says the Mahathir government has a “paranoid fixation with being the best and the biggest.” Mahathir has also clashed repeatedly with foreign critics over human rights and other hot-button issues. Now in his 16th year at the helm, he is one of the patron saints of so-called “Asian values”—which hold that, within limits, authoritarian rule is more conducive to economic development and social harmony than unbridled democracy. He is also an aggressive spokesman for the developing world. Notoriously blunt, he seldom misses a chance to blast the West for what he sees as its hypocrisy and ulterior motives in dealing with Asia. He opposed the creation in 1989 of the AsiaPacific Economic Co-operation forum, fearing that strong non-Asian countries—the United States, Canada and Australia— would try to dominate it. He has since relented, and is expected to attend the APEC summit in Vancouver in November. But he has had a running battle with Paul Keating, the former Australian premier, over what it means to be Asian—and whether Australia fits the description.

The prime minister has been even tougher on his own people. In the early 1970s, he wrote The Malay Dilemma, which claimed hereditary and environmental factors had conspired to make the country’s indigenous, mainly Muslim majority—known as bumiputras or “sons of the soil”—lazy. Comparing the “bumis” to Malaysia’s much wealthier ethnic Chinese, who make up roughly 30 per cent of the population, Mahathir wrote: “Deep under, the inherent traits and character acquired over the centuries persist.” Published in the wake of race riots in 1969 that left several hundred dead, the book was banned until he became prime minister. Since then, he has worked to address many of the problems he had raised.

To give poor Malays the skills needed to compete in the marketplace, the government in 1970 unveiled what it called the New Economic Policy, an unusually aggressive experiment in social engineering. The long-term goal was to ensure that ethnic

Malays held a bigger share of the national wealth. It introduced scholarships, hiring quotas and a host of other measures to help level the playing field. To a large extent, they worked. But on taking office in 1981, Mahathir saw that the key was wealth creation, not redistribution. Spurred by the success of other East Asian economies—especially neighboring Singapore—he opened Malaysia fully to foreign investment and launched one of Asia’s most ambitious privatization programs.

The results have been spectacular. Real

PHILIPPINES

South China Sea

BRUNEI

Java Sea

GDP growth has exceeded eight per cent for each of the past nine years. Less than 10 per cent of the population now lives in poverty (compared with half in 1970), the infant mortality rate has fallen to Western levels, and per capita income has soared. Twenty-five years ago, Malaysia’s few exports were mainly commodities such as palm oil, tin and rubber. By the 1990s, the country had become a leading electronics producer and was deriving three-quarters of its export revenue from manufacturing.

Malaysia’s takeoff has attracted considerable Canadian interest. Between 1985 and 1995, two-way trade increased from $351 million to $2.12 billion, with Malaysia enjoying an almost $l-billion surplus. At the moment, as many as 100 firms with Canadian ties have operations in Malaysia, including

London Life, the Bank of Nova Scotia and Bombardier. ‘Things are booming,” says Harry Van Zeist, Kuala Lumpur-based managing director of Calgary’s Nova Gas International, who expects more Canadian companies to make the city their Asia-Pacific hub. “People feel pretty confident investing here. Also, when you look at the cities in the region, cost combined with quality of life makes this the best of the lot.”

Commercial links got a shot in the arm a year ago when Prime Minister Jean Chrétien visited on a Team Canada business trip. Malaysians, says Paul Lau, a senior trade officer at the Canadian High Commission in Kuala Lumpur, have come to see Canada as something of a role model, a more realistic benchmark for their country than the United States or Germany. Canadians, on the other hand, must begin to think of Malaysia as an equal, he asserts. ‘We can no longer look at it as a developing country,” says Lau. “It is no longer a donor-receiver relationship.”

Yet in a nation where prosperity is new and memories are long, each dip in the growth rate prompts a question that has haunted Malaysians for years: what happens if the good times come to an end? The prime minister didn’t wait to find out in 1987, when the

economy suffered its last downturn, which worsened the gap between indigenous Malays and wealthier Chinese. Fearing instability from renewed ethnic tensions, Mahathir ordered scores of people detained under the Internal Security Act, a draconian edict left on the books by the British when they pulled out in 1957. Any hint of a slump now is sure to put the government on edge.

A more immediate concern is a rising tide of Islamic fundamentalism. Malaysia is a federation of the old Malaya and two territories on the island of Borneo: Sarawak and Sabah. The only state not in the hands of Mahathir’s United Malays National Organization is Kelantan, bordering Thailand, which is run instead by the Parti Islam Sa-Malaysia. The avowedly Islamic Kelantan authorities have instituted separate supermarket checkout counters for men and women, banned unisex hair salons, and tried to impose a strict Muslim penal code, including stoning for adulterers and lashings for those caught with liquor. Federal courts have blocked many of the harsher measures, but the prime minister has also made it clear that the government intends to keep the fundamentalists on a short leash. He sees them as a danger not only to racial harmony £ but to his vision for Malaysia. In showing that it is possible to enm joy prosperity while remaining | true to the Koran, he hopes to make Malaysia an example for the entire Islamic world.

Opposition leader Lim says that while Malaysians enjoy more freedom than their Singaporean neighbors—“compared with [Singapore senior minister] Lee Kuan Yew, Mahathir is a democrat”—the government is becoming increasingly authoritarian. Lim fears that rampant cronyism and corruption, coupled with endemic deal-making behind closed doors, could undermine investor confidence. The country runs on the parliamentary system, but the government controls the media, and big business often buys the bureaucrats.

The post-Mahathir generation may bring more reform. Deputy Prime Minister Anwar, 49, a onetime student radical jailed for two years under the Internal Security Act, has worked hard to cultivate a liberal image abroad. Lacing his speeches with references to Aristotle, Thomas Aquinas and other icons of Western thought, Anwar has trumpeted the universality of human rights, cast scorn on suggestions that East Asia is unfit for democracy, and urged greater respect for the environment. So far, however, Mahathir remains in firm control, and plans to keep it that way. Even his harshest critics concede he will be a tough act to follow.

MICHAEL STEINBERGER in Kuala Lumpur