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The Asian Wall Street Journal
4th September 2001

Sarawak's 'Brown Rajah' Taib Clings to His Dwindling Power

By LESLIE LOPEZ
Staff Reporter of THE WALL STREET JOURNAL

KUCHING, Malaysia -- For 20 years, Sarawak's flamboyant chief minister, Taib Mahmud, has ruled this resource-rich Malaysian state on the island of Borneo.

To friends and foes alike, the dapper, silver-maned chief minister is known as the "Brown Rajah," a cheeky play on the famous White Rajahs, Britain's Brooke family, which ran Sarawak as a private fiefdom from 1841 until 1941.

These days, however, the Rajah's perch in the state capital of Kuching appears a little shaky. Discontent within his own political party has bubbled to the surface, triggered largely by Tan Sri Taib's own reluctance to put a succession plan in place. Political opponents, meanwhile, are complaining that the chief minister's family and their business associates have benefited unfairly from government backing. And the sensitive issue of land ownership is pitting Tan Sri Taib and powerful timber groups against Sarawak's forest-dwelling indigenous groups, who account for roughly 40% of Sarawak's two million people.

These challenges come at an awkward time for the 65-year-old chief minister. The Sarawak government dissolved the state legislative assembly Monday, paving the way for an election that must be held within the next 60 days to choose a new state legislature. The vote will test Tan Sri Taib's ability to maintain the status quo against opponents bent on breaking his paternalistic governing style, which critics say has muffled political debate and bred corruption and nepotism.

"This election will be a watershed. We're dealing with younger voters who have very different demands," said Justin Jinggut, the secretary general of Sarawak National Party, a key member of Tan Sri Taib's ruling coalition government.

Most local opposition figures concede that toppling Tan Sri Taib himself will be impossible. "The state government's political machinery and ability to dispense patronage can't be matched," said Sim Kwang Yang, a former opposition leader. But he and other political foes say Tan Sri Taib's government could be badly bruised in the coming election, losing as many as 10 seats in the 62-member state assembly to the opposition. The ruling coalition currently holds 58 seats.

At Your Service - Percentage share of Sarawak's GDP by sector
Year	1997	1998	1999	2000
Services	27.7	29	29	29.4
Mining	26.3	26.1	25.6	24.4
Manufacturing	22.1	22.1	22.4	22.5
Agriculture and fishery	7.6	7.7	8.3	9.4
Construction	8.5	8.6	8.3	7.9
Forestry	7.8	6.5	6.4	6.4
Source: Sarawak state government

Tan Sri Taib, however, said he isn't too concerned. The chief minister expects the opposition to raise issues such as transparency and change.

"These are not big issues. Maybe in Kuching but most people in other parts of Sarawak are still keen on development," he said in an interview earlier this year.

Prime Minister Mathathir Mohamad's national government is counting on the accuracy of Tan Sri Taib's assessment. Sarawak, the largest of Malaysia's 13 states, has emerged as a crucial factor in the country's political equation after the November 1999 national elections.

Tan Sri Taib's coalition, a component of Dr. Mahathir's National Front government, captured all 28 of the state's parliamentary seats in the 1999 national election. That clean sweep -- representing 15% of Malaysia's 193-member Parliament -- is a sharp contrast to the performance of the National Front in Peninsular Malaysia, where Dr. Mahathir's party, the United Malays National Organization, or UMNO, suffered significant electoral setbacks. Much of this is due to the fallout from the government's sacking of former deputy premier Anwar Ibrahim more than two years ago on charges of corruption and sexual misconduct.

Should this trend persist, political analysts say, the National Front's two-thirds majority in Parliament could be in jeopardy in the next election, which must be held before the end of 2004. In such a scenario, Sarawak's role as a political crutch for Dr. Mahathir's government will become even more important.

But first, Tan Sri Taib must obtain a strong mandate in the coming state election. Failure to do so, say political analysts, would not only embolden the opposition forces in Sarawak and Tan Sri Taib's political foes within his own party, but also further fragment Malaysia's political spectrum.

Sarawak is ethnically diverse, which makes politics here even more complex than in Peninsular Malaysia. Sarawak's population is made up of 30 indigenous ethnic groups scattered sparsely through the state's interior. Melanaus, of which Tan Sri Taib is one, and ethnic Malays, make up about 24%. The ethnic Chinese make up 20% of Sarawak's population, while the Dayaks -- the blanket term for Sarawak's array of native tribes -- account for nearly 40%.

Sarawak's economy is the most resilient among Malaysia's 13 states, with its gross domestic product expanding at an average growth rate of 8.5% each year between 1988 and 1997. Sarawak even escaped the ravages of Asia's 1997-98 financial crisis and managed 2% growth in 1998 when Malaysia as a whole slipped into its worst recession ever. Tan Sri Taib said that economic growth -- powered by high oil and gas prices -- is expected to hit 8.5% this year, up from 7.4% in 2000.

But Sarawak's economic gains have become a double-edged sword for Tan Sri Taib. Better living and educational standards have fanned expectations of further improvements and prompted greater scrutiny of the business affairs of his family.

Still, Tan Sri Taib said allegations of favoritism in the award of contracts and timber concessions are baseless and meant to discredit him politically.

"We give contracts to people who can deliver," he said. "Just because they are close to the state government shouldn't be made into an issue."

Still, complaints of favoritism have increased because one of the main beneficiaries in recent years has been Cahaya Mata Sarawak Bhd., or CMS, a publicly traded investment holding concern that is 40%-controlled by members of Tan Sri Taib's family. Tan Sri Taib's brother, Onn Mahmud, serves as chairman of the group, while the chief minister's two sons, Sulaiman Abu Bakar Taib and Mahmud Abu Bekir Taib are joint executive directors of CMS.

Tan Sri Taib said he isn't involved with contract awards to CMS. "I always say treat them like any other company. I can't say don't give them any jobs. This is a public company and I could be sued by the shareholders."

Opposition leaders and private businessmen maintain that CMS's transformation from a modest cement manufacturer to a conglomerate with interests in banking, stockbroking, construction, road building, property development and steel manufacturing, is largely due to its political pedigree.

"It's really tough. Many people believe it is a waste of time bidding against CMS. You're are better off getting them as your partners if you want to get anything," said a prominent Kuching-based ethnic Chinese businessman who has done business with the CMS group and knows the Taib family well.

This businessman and some local politicians said CMS's voracious appetite is stirring resentment among the ethnic Chinese, who fret that they are being cut out of the state's development programs.

"The Chinese don't say much," said Mr. Sim, Sarawak's former chief opposition leader. "But there is resentment on the ground and this will cost Taib votes."

George Chan, Sarawak's Finance Minister and Tan Sri Taib's most trusted lieutenant, contends that the bulk of the ethnic Chinese in the state will continue to support Tan Sri Taib's ruling coalition. But he concedes that there is a perception problem over the first family's business interests. "To be frank, there is some grumbling about the chief minister's family being in business. But a lot of it is exaggerated and it is really people dropping his name to try to secure government contracts or to get approvals speeded up," said Tan Sri Chan, whose daughter is married to Tan Sri Taib's son.

Dissent among the Chinese isn't the only political brushfire Tan Sri Taib has to fight. Sarawak's Dayaks are also becoming restive. Logging, which penetrates deep into Sarawak's interior, has deprived indigenous groups of their so-called native customary rights over their ancestral land and stoked resentment against big business. Opposition politicians say that confrontation between native groups and loggers are on the rise and that could push the Dayaks to vote against the Taib government.

Despite the rising discontent Tan Sri Taib still feels that he is the best man to lead Sarawak because he has yet to find an ideal successor. "I've been grooming some people and I hope at least one can make it," he said, adding that he plans to serve out the next five-year term following these elections.