Interview with Anwar Ibrahim


Let’s start by talking about the current situation in Malaysia. In a recent interview you described it as being almost a failed state, particularly in the context of its neighbours. What makes you say that and what in your opinion has caused that situation?

The issue of governance and in terms of failing to deal with the issue of endemic corruption, the judiciary is still questionable, so their decisions and independence and the absence of control; the media is so pervasive. For example, in the latest campaign there is a resurgence of the communist party. These are signs, you know, that [Malaysia] is becoming so authoritarian and so repressive. Why is there a need now to have a massive campaign in the government-controlled media – which is entirely, fully controlled by them – to suggest that there is a resurgence of communism?

There has also been a great deal of talk in Australia in particular about this being the Asia-Pacific Century. Do you agree with that? How do you see Malaysia benefiting from any possible shift in global economic and political power?

Well, I don’t have an issue against that, in terms of there’s a need to fortify and even strengthen the economic cooperation within the region. I think we should be all-encompassing in the region. So I think that now there has been eagerness, particularly in the light of the latest financial and economic crisis. But we have to move on first by putting our own house in order. Yes the impact is felt by all countries and the countries have to take measures with these stimulus packages, but the way it is being done is questionable. It must be transparent. And [in Malaysia] we have to look at how it’s being done in Malaysia compared to China. China focussed 40 per cent [of its stimulus] on infrastructure in the earthquake-affected areas; another 30 per cent on rural infrastructure…

I am no great friend of China, but still there are issues that I think we have to look [at] and study. Now compare this to Malaysia. Out of the $70 billion so-called package, the funds allocated for infrastructure per-say is only $15bn. But I charge there are embellishments to push the figure upwards: $10bn for the stockmarket; another $15-20bn for bank guarantees in case there are problems. So you are not talking about a proper stimulus package; we do not know where it is spent or how it is going. Even at a time of crisis, I would use this creative destruction because you can use this to improve and build anew, not to fortify and strengthen the auxiliary and corrupt practices.

So is there a real danger in your eyes of Malaysia slipping behind its neighbours, particularly in light of the current global financial crisis?

In terms of the fundamentals, I must admit that Malaysia is on a much stronger footing, partly because of better infrastructure and the financial services. In light of the last crisis of 1997-98, I think some of the measures have been adopted to strengthen the position of the financial institutions, including the banking sector. That I concede, and I think is something positive that will help us. Similarly there are a lot of reserves, which are quite strong, although, I think, slipping really fast.

Our concern is more with the issue of governance. If you fail to improve the institution of governance, including the casting of an economic policy and preparedness to move so that Malaysia becomes more competitive, then we will certainly lose out. In some sectors we have lost out even to Indonesia and Thailand, to China, of course, and even Vietnam now. So I think that we have to depart from the obsolete economic policies. Now I think some positives measures have been implemented – in the services sector, for example. But liberalising and bringing in foreign investors [counts for nothing when you] fail to deal with the more substantive issues, like the need for affirmative action. Then these policies can never be fully endorsed by the general public.

I am for the market economy and for liberalisation, but we cannot ignore the grinding poverty and we cannot ignore the importance for affirmative action based on need, not on race. And more important still, the need to strengthen the system of government; the judiciary must be independent. The media must be free. How do you then evaluate and assess the success of policies if the statistics are all questionable. The government says ‘Our growth is two per cent, inflation is 2.5 per cent.’ [But those figures are] generally not well accepted. The people still have doubts and questions and are cynical, and this is dangerous in a modern government.

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