Malaysia in 1989: Forging a Plan for the Future

Abstract

After two years of political turmoil involving a power struggle within the dominant Malay party in the government coalition, the faction led by Prime Minister Dr Mahathir Mohamad finally emerged the undisputed victor in the early part of 1989. During the extended and bitter struggle, the United Malays National Organization (UMNO) had broken into two factions, the party had been declared an illegal body by the courts, and eventually had been reconstituted with a new constitution designed to check any further challenges to the top leadership arising from the grass roots. The struggle to unseat Dr Mahathir from power had been led by his former Deputy Prime Minister Musa Hi tarn and the former Finance Minister Tengku Razaleigh Hamzah. In the course of the political battles, both the courts and the monarchy had been dragged into the political fray and had been split over their support for the opposition or their affiliation with Dr Mahathir, his policies, and his aggressive political tactics. In the process of the extended conflict, Dr Mahathir had also effected the removal of the Lord President, Salleh Abas, and two other High Court judges who were believed to have given too much attention to the rights of the political opposition. Having reconstituted UMNO, Dr Mahathir gradually re-established his firm control over the multi-ethnic Barisan Nasional (BN, National Front) coalition upon which his government depended for its political support. Although the BN coalition had suffered an important by-election defeat at the hands of the newly formed opposition coalition during 1988, by the end of the year this set-back had been effectively avenged, and the BN, with the reformed UMNO as the dominant partner, was once again in a commanding and entrenched position at the centre of power with Dr Mahathir in firm control. As 1989 approached, the agenda of the government focused on three primary objectives: to defeat and further isolate the Malay opposition being orchesurated by Tengku Razaleigh; to continue to improve the Malaysian economy in anticipation of an election within eighteen months; and to formulate a revision of the previous but expiring New Economic Policy (NEP) and replace it with a new social ethnic compact which would guide the nation into the twenty-first century. The political, economic, and social priorities of the government were entwined, and would obviously be affected by the power struggle which had gripped Malaysia over the previous two years. It is, therefore, not surprising that the government appeared to give the highest priority to the first of these three objectives while also making preparations for demonstrable progress on the other two.