Seize the day, Mr Abdullah

His predecessor put Malaysia on the world map, for good reasons and bad. Prime Minister Abdullah Ahmad Badawi faces the challenge of showing that this small but closely watched country can be an exemplary modern, pluralistic, open, democratic Muslim-majority nation.

Those expecting rapid change are in for disappointment. Pak Lah, as he is colloquially known, may have won a remarkable electoral victory, but his own temperament and Malaysia's institutions suggest that patience is needed. He is set on making some fundamental changes in the way Malaysia was run under Mahathir Mohamad. But he implicitly acknowledges that this will take time. Whether he has enough time and sufficient support from his party, the United Malays National Organisation (Umno), remain to be seen.

There has been widespread disappointment, even among his natural allies, that his post-election cabinet saw the return of most old faces, some tainted by the money politics of the past. Those now hoping for a reshuffle after Umno party elections next month are likely to be disappointed. Mr Abdullah is hemmed in by his own need not to upset too many party stalwarts, by the need to provide ministerial posts to the nominees of his Chinese and Indian coalition partners, and to provide younger MPs with the experience of junior ministerial office. Even within those limits, he appears to have been overly cautious.

But he cannot be too cautious for too long. The election has been seen primarily as a vote of confidence in him, and partly as a rejection of the conservative Islam of PAS (the Parti Islam se-Malaysia), the main opposition party. But the results also showed the electorate's concern with performance in office.

Mr Abdullah faces a long, hard struggle to wean Umno away from the politics of patronage, the use of state contracts to reward party-affiliated businessmen. Money politics under Dr Mahathir hurt the party in the eyes of the electorate, but Umno has been in power too long to easily change its ways. Mr Abdullah has around him a group of bright young people. But as a natural consensus builder, he may find reform and party imperatives difficult to reconcile.

He also faces a difficult task of re-orienting the government's role in business. For now, the economy is being buoyed by high commodity prices and electronics exports. However, the longer-term growth is not so assured, given commodity price cycles and the competition for foreign direct investment from China and elsewhere. Meanwhile, the government needs to cut back deficit spending from more than 5 per cent to a sustainable 2 to 3 per cent of gross domestic product. That will mean not just fewer eye-catching projects, but the sacrifice by closure or sell-off to foreign investors of capital-intensive ventures in steel, cars, semi-conductors and other aspects of Dr Mahathir's forced march to developed-country status. He has begun to replace political appointees with technocrats to head state enterprises. That should improve management, but does not in itself resolve the problem of the business-politics nexus.