Visitors to Kuala Lumpur could be forgiven for thinking that they have landed in a highly developed nation. From the gleaming steel and glass of the international airport to the Petronas Twin Towers, once the highest skyscrapers in the world, the trappings of ‘progress’ in the city are everywhere.

South of Kuala Lumpur, the federal administrative centre of Putrajaya features a magnificent touristy mosque, lavish buildings and an imposing prime minister’s office topped with a green onion-shaped dome. It may be a metaphor of sorts testifying to the accumulation of power in the centre, especially in the office of the Prime Minister, along with a process of Islamization coming head-to-head with the symbols of export-oriented economic growth.

But hidden from the casual visitors’ view are the urban slums, crammed high-rise lowincome housing, rural villages still in poverty and ramshackle settlements for undocumented workers and refugees from the region. For a while, rising per capita income levels on the back of the foreign investment-driven economy, expanding oil-palm plantations, and discoveries of oil and gas papered over widening income disparities. But the human rights of workers and others have been trampled upon and a tight lid kept on dissent through the periodic use of oppressive laws such as the Internal Security Act, which allows detention without trial. Wage levels of Malaysian workers have been suppressed by a policy of importing low-wage foreign workers.

Critics say the official benchmark for measuring poverty, a monthly household income of 700-800 ringgit ($190-$220), is too low, and that it should be closer to 2,000 ringgit ($550). Needless to say, if this higher figure were used, then the official poverty rate would be much higher.

A political reform movement (reformasi) was unleashed when the then deputy prime minister Anwar Ibrahim was ousted from government in 1998. As low-income Malaysians, including many Malays, struggled to make ends meet, discontent grew over the year. Creeping Islamization led to worries among Hindu, Christian and Buddhist minorities.

A sense of economic marginalization and discrimination mounted especially among the Indian community (seven per cent of the population), many of whose ancestors were brought in as low-wage plantation labourers from south India during British colonial rule. This led to the emergence of the Makkal Sakthi (People Power) movement.

All these factors combined into ‘a perfect storm’, leading to shock results in a watershed general election held last year. For the first time since Independence, the ruling coalition led by the dominant United Malays National Organization (Umno) lost its coveted twothirds majority in the Federal Parliament, as an alliance of disparate opposition parties cobbled together by Anwar seized power in 5 of the 13 states in the federation.

The Umno leadership effectively forced Prime Minister Abdullah Badawi to hand over the reins to his deputy Najib Razak, who has been linked to a murder case – a link which he vehemently denies. Though Razak is poised to take over in March 2009, the political transition has by no means run its course. The opposition alliance is likely to gain further momentum as the economy slows and discontent among workers rises. Increasingly, workers have articulated demands for a minimum wage and called for an end to the privatization of essential services, which first began under the administration of Mahathir Mohamad in the 1980s, but restrictive labour laws have suppressed the trade union movement.

Meanwhile, in the resource-rich but relatively undeveloped north Borneo states of Sabah and Sarawak, demands for greater oil royalties and local autonomy are being heard. And now the global recession will force planners to rethink Malaysia’s economic policies as a plunge in oil and other commodity prices and depleting oil reserves add further uncertainty.

Anil Netto

Fact file

Leader	Najib Razak takes over as Prime Minister in March 2009.
Economy	GNI per capita $6,540 (Thailand $3,400, Singapore $32,470).
Monetary unit	Ringgit
Main exports	Electrical & electronic products; crude petroleum, petroleum products & natural gas; other manufactured products. Malaysia enjoyed a surge in revenue in recent years as a result of the boom in commodity prices, but these have now slumped. A major challenge is that the country is expected to become a net importer of oil within a few years. Petronas (the state-owned oil company) is thus engaged in oil exploration overseas while the Government builds more hydroelectric dams.
People	26.6 million. Population growth rate 2.3%. People per square kilometre 81 (UK 250).
Health	Infant mortality 10 per 1,000 live births (Singapore 2, Thailand 6). The public healthcare system is underfunded and crowded: government health spending is only 2% of GDP.
Environment	The recession might provide a brief respite for the environment. Primary rainforests have been steadily depleted as a result of excessive logging, clearing of land for oil-palm plantations, and dam construction. Many rivers have been polluted by effluents and emissions from industry.
Culture	A former British colony, occupied by Japan during World War Two. Malays (over 50%) control much of the government, military and police. Chinese (24%), Indians (7%). Other indigenous groups (11%) include Ibans and Kadazans.
Religion	Islam is the official and majority religion, though Hinduism, Buddhism, Christianity and others are also practised.
Language	Bahasa Malaysia is the national language, especially in schools and government, though Chinese and Tamil vernacular schools exist. English and Chinese are also common in commerce and education.

Country ratings in detail

Income distribution	One of the highest income disparities in the region. Heavy industrialization and neoliberal policies, including privatization, which began under Mahathir in the 1980s, led to widening income disparities, including a rural-urban divide. 1992 ♦♦♦
Literacy	92%. But some rural schools still lack basic amenities such as electricity and water, let alone computers. 1992 ♦♦♦♦
Life expectancy	74 years (Singapore 80 years, Thailand 70 years). There are shortages of skilled personnel and long queues in the government hospitals frequented by lowerincome groups. 1992 ♦♦♦♦
Freedom	Malaysia has a rising number of civil society groups and resurgent opposition parties – a reform movement has made many inroads in the last decade. But oppressive laws that allow detention without trial, weak judicial independence and the curtailment of freedom of assembly hinder moves towards greater democracy. 1992 ♦♦
Position of women	Generally improving but rising levels of domestic violence and rape have cast a shadow. Although advancing in education, women are still not adequately represented in decision-making roles. 1992 ♦♦
Sexual minorities	Homosexuality is illegal and both heterosexual and homosexual sodomy can incur heavy punishment, though few have actually been convicted.
New Internationalist assessment	The Government has been criticized for its race-based approach to politics and economic management. Its response has been slow, especially in its efforts to reform key institutions, and it still resorts to oppressive laws and controls the media. But wider use of the internet has led to freer discourses in cyberspace. The country is in the midst of a political transition as more and more Malaysians try to rise above ethnic and religious polarization. The results of the 2008 general election provide some grounds for optimism that a new Malaysia is possible.