Malaysia celebrated its 40th anniversary yesterday in high spirits despite a battered currency and stock market which may set back the country's aim of becoming a developed nation by 2020. The Prime Minister, Mr Mahathir Muhammad, cast aside the current economic gloom for a day to join his countrymen in marking the nation's 40th anniversary after breaking free from British colonial rule in 1957.
Tough realities, however, confront the prime minister as fears of overheating and endless assaults on its currency and stock market may end Malaysia's 10 years of sterling growth of above 8 per cent a year.
But Mr Mahathir, who has transformed Malaysia from an agricultural backwater into an industrial hub in his 16 years of office, was never one to flinch in the face of adversity.
Mr C.S. Lum, economist with Phileo-Allied Securities, credits Malaysia's economic success to Mr Mahathir, whom he describes as positive and visionary.
"The current turmoil in the financial markets is merely an external shock and a downturn in the business cycle. We should look at the long-term prospective than at such fluctuations," Mr Lum said.
Mr Mahathir has laid out a vision and plan for the economy to join the ranks of industrialised nations by 2020 and the current financial weakness was part and parcel of the transitional stage, he said.
But some critics said the prime minister may be too carried away in his ambition to sustain growth and it would be interesting to watch how he manoeuvres the country out of the economic knot.
Mr Mahathir himself has conceded that Malaysia's growth could be retarded by the economic turmoil, which has seen the Malaysian currency, the ringgit, plunge to a record low against the US dollar and the bourse falling one-third in value since early this year.
But he said Malaysia could still attain 8 per cent growth this year "in ringgit terms", although its per capita income would decrease.
The parliamentary opposition leader, Mr Lim Kit Siang, said Malaysia's 40th anniversary celebration yesterday had turned sombre following the twin crisis of its economy and environment, referring to a continuing haze problem.
The country last week approved an action plan to combat the worsening haze, which it blamed on forest fires in neighbouring Indonesia.
"It should give cause for Malaysians to ponder on the urgent need to address the fundamental questions of nation-building and not be carried away by the economic success of the past nine years to gloss over abiding problems, hoping they will remain hidden under the carpet," Mr Lim said.
But the New Sunday Times newspaper in its editorial urged the nation not to allow the "transient phenomena to put us down" because Malaysia's economic success is "no miracle but grounded on sound policies and the people's effort".