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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: B Tate who wrote (4814)	6/25/1998 9:35:00 AM
From: Worswick	Read Replies (2) \| Respond to of 9980

Dear me this looks grim Bernie. Best,

To: B Tate who wrote (4814)	6/25/1998 10:19:00 AM
From: Bill Ounce	Read Replies (2) \| Respond to of 9980

Malaysia PM Defends Daim Appointment From: Theotherhalf <mobile@tm.net.my> Newsgroups: soc.culture.malaysia Subject: Malaysia PM Defends Daim Appointment Date: Thu, 25 Jun 1998 21:13:04 +0000 Reuters 25-JUN-98 By Jalil Hamid KUALA LUMPUR, June 25 (Reuters) - Malaysian Prime Minister Mahathir Mohamad defended on Thursday the appointment of his trusted lieutenant Daim Zainuddin to his cabinet amid opposition charges that he could be sending wrong signals to the world. Mahathir, speaking a day after naming the 60-year-old government veteran as minister with special functions in charge of economic development, said Daim would stay until the current economic turmoil was resolved. Responding to reporters' questions, Mahathir said Daim's role would not overlap with that of Finance Minister Anwar Ibrahim, who had been largely in charge of pulling Malaysia out of its worst economic crisis in more than a decade. But opposition leader Lim Kit Siang said he had reservations. "Daim's appointment...raises the question whether we are nearing a situation where there would be two finance ministers in the cabinet, one in name without the support of the prime minister while another who does not have the title of finance minister but with the powers of the office and the support of the prime minister," he said in a statement. "This will send out distressing signals to the market, the country and the world that the government leadership is still divided on how to restore confidence to resolve the worst economic crisis facing the country," said Lim, who is the secretary-general of the Democratic Action Party. Finance minister from 1984 to 1991, Daim was credited with pulling Malaysia out of a recession in the 1980s. He is one of the richest men in the country and one of the most powerful behind the scenes. Mahathir, worried over possible conflict of interest, said Daim must relinquish his business interest but conceded that this might take time. As architect of Malaysia's privatisation programme, which made millionaires of a few Malay entrepreneurs selected to take over government enterprises, Daim was at the vortex of criticism about cronyism. "Another distressing signal in Daim's appointment is that the issues of corruption, cronyism and nepotism would be addressed seriously by the government," the DAP's Lim said. Daim's promotion came three days after Mahathir rebuked a youth leader of his party for making accusations of cronyism and nepotism which he said were baseless.

To: B Tate who wrote (4814)	6/25/1998 11:08:00 AM
From: Bill Ounce	Respond to of 9980

Malaysia's PM Puts Anwar to the Test From: Theotherhalf <mobile@tm.net.my> Newsgroups: soc.culture.malaysia Subject: 'minister in charge of annoying Anwar' Date: Thu, 25 Jun 1998 21:11:21 +0000 Reuters 25-JUN-98 By Nelson Graves KUALA LUMPUR, June 25 (Reuters) - Who is in charge of Malaysia's economy? With the appointment of his trusted lieutenant Daim Zainuddin as minister, Prime Minister Mahathir Mohamad has stirred new anxieties over economic policy and his relationship with his deputy Anwar Ibrahim. The move has such potentially far-reaching implications that stunned government officials and opposition politicians were not beyond wondering out loud if it portended an eventual showdown between Mahathir and Anwar. "This will probably create a situation of conflict and exacerbate a conflict already existing between Mahathir and Anwar," Syed Husin Ali, president of the opposition Parti Rakyat Malaysia, told Reuters. The promotion of Daim on Wednesday to minister with special functions in charge of economic development thrusts him into the eye of a debate over how to pull Malaysia out of its worst economic crisis in more than a decade. It is an open secret that Daim and Anwar, who is also finance minister, differ over crucial economic matters. A fabulously successful Malay businessman at the centre of power, Daim epitomises intimacy between commerce and politics. Anwar is no pauper, but he has been openly critical of cronyism and nepotism -- code words for a perceived need for a new approach to governance -- and said time and again there will be no bailouts of the politically powerful. The stock market has never really recovered from the bout of jitters that struck last year when United Engineers (M) Bhd announced it was taking a 32 percent stake in Renong Bhd. More than the 2.34 billion ringgit ($590 million) price tag, the deal put the market on edge because it was seen as a cash-rich firm rescuing an indebted affiliate controlled by the political elite. That worried foreign investors, who fear an ad hoc crisis management approach that focuses on coming to the aid of firms with political connections and ignores deeper structural problems. While there was no evidence that Daim was behind the deal, he has been an outspoken proponent of government aid for "vital, viable" firms. "In the case of UEM and Renong, if the worst happens, the government will not abdicate its responsibility to ensure that vital, viable assets and operations in companies are saved, even with public funds," he said in a contribution to a recently published book entitled "Hidden Agenda". For his part, Anwar has worked behind the scenes to make sure that money from the Employees Provident Fund (EPF), the state pension fund, is not used to rescue ailing firms. Daim is seen as carrying Mahathir's banner in a struggle over monetary policy. Mahathir has aggressively pressed banks to bring down rates. Anwar, who shares the central bank's worries over the possibility that lower rates would undercut the ringgit, initially resisted the campaign. Then he came on board when Mahathir shifted the focus to banks' lending rates, not the central bank's intervention rate. But the debate has put the central bank, Bank Negara, on the defensive. Governor Ahmad Mohamed Don offered to resign earlier this month, but Anwar asked him to stay on. A day after the announcement, there were more questions than answers about Daim's new portfolio. Mahathir said late on Wednesday that Daim's duties would not overlap with those of any other ministers. A senior government official was sceptical. "Why do you need another minister in charge of economic matters? What is his line of reporting? Will he give orders to the central bank governor?" the official asked. "Is his title 'minister in charge of annoying Anwar'?" a diplomat said. "The battle lines are drawn. This clearly puts Anwar in a box." The day after the announcement, Anwar had still not made any public statement on Daim's appointment. "My guess is that Anwar will not make any challenge and lie low. Then when things go bad, he can blame Daim," the diplomat said. "This will be a test to see whether Anwar in practice, not just rhetoric, is really loyal to Mahathir," Syed Husin said. "If not, he will face the consequences, which would be far-reaching, not only for his political party but for the country."