Daim and Anwar: ‘frenemies’?

One was a student leader and the other an established businessman, but both were roped in for Umno by Dr Mahathir Mohamad.

(FMT) – Daim Zainuddin, who died on Nov 13, was a strong critic of Anwar Ibrahim, most recently accusing the prime minister of betraying his promises of reform and for politically motivated charges brought against him at the beginning of this year.

Anwar has likewise been openly critical of Daim, especially since taking office two years ago, but cut a more compassionate tone on hearing of the businessman’s demise, saying the country recognised his contributions, particularly during two stints as finance minister, from 1984 to 1991, and 1999 to 2001.

Their relationship over the past four decades or so has been hard to define: were Daim and Anwar friends or enemies, or are Malaysians resigned to simply calling them “frenemies”?

The duo, went from Cabinet colleagues to bitter political rivals, then became allies once more after the 14th general election (GE 14) six years ago, before another falling out after the 2022 polls.

FMT takes a look at their relationship over the last 42 years.

 

MPs in 1982, Cabinet colleagues two years later

Anwar and Daim first came to national prominence when they were elected MPs for Permatang Pauh and Kuala Muda, respectively, on Umno’s ticket at the 1982 general election.

They could not have been from more diverse backgrounds. Anwar was a student leader while Daim was already an established businessman, yet both were courted by Dr Mahathir Mohamad to join the party and run for election. Mahathir had at the time just taken over as prime minister from Hussein Onn.

A 1983 reshuffle saw Anwar brought into Mahathir’s Cabinet as youth and sports minister. Another shakeup the following year saw Daim roped in as finance minister, with Anwar moving to the agriculture portfolio.

Daim would go on to helm the finance ministry for seven years, taking Malaysia from a growth rate of -1.03% in 1985 to 9.06% in 1989, a feat that saw him recognised as Mahathir’s economic troubleshooter-in-chief.

Two years later, Daim handed over the finance portfolio to Anwar and took on a backbencher role.

 

Daim’s gradual return, as Anwar falls out with Dr M

Amid the Asian financial crisis in 1997, Mahathir brought Daim back into government as his economic adviser, a move widely seen as undermining Anwar, who had displaced Ghafar Baba as deputy prime minister four years earlier.

The financial crisis, which saw the ringgit depreciate by nearly 50% against the US dollar, saw the Mahathir-Anwar relationship deteriorate following sharp disagreements over economic policy.

Anwar had sought to implement policies which involved budget cuts and structural reforms recommended by the International Monetary Fund, which Mahathir opposed.

In December 1997, Daim was appointed executive director of the National Economic Action Council, a powerful role which saw him roll back many of Anwar’s policies.

It all came to a head shortly afterwards, as Mahathir and Anwar clashed, culminating in Anwar’s sacking as deputy prime minister and finance minister on Sept 2, 1998, ostensibly on moral grounds.

Anwar was charged in court later that same month, and on April 14, 1999 was sentenced to six years in jail for abuse of power.

At the time, Anwar claimed there was a conspiracy to kill off his political career, and named Daim as one of the plot’s “master conspirators”.

At Mahathir’s request, Daim assumed the finance portfolio once again, and with it the chief role of navigating Malaysia out of the Asian financial crisis, which had spilled over into the 2000s.

Anwar, in turn, accused Daim, also Umno’s treasurer, of being involved in corruption and abuse of power during his first stint as finance minister.

Nothing came of those allegations, and Daim went on to serve as finance minister until 2001, when he bowed out, credited with having helped Malaysia tide over the financial crisis.

 

Anwar convicted, Daim returns

Acquitted by the High Court of sodomy in 2012, Anwar led the opposition Pakatan Rakyat coalition against the Barisan Nasional government, now led by Najib Razak. However, the acquittal was overturned by the Court of Appeal two years later, and Anwar was sentenced to five years in prison.

Meanwhile, Daim, who had kept a low profile after his exit from politics, returned to the spotlight to campaign for BN in the 2013 general election. On the campaign trail, Daim was reported by The Malaysian Insider as having called Pakatan Rakyat a “confused” coalition, and Anwar a “huge liar”.

He also claimed that Anwar had been an incompetent finance minister and had sought his advice almost every day on how to oversee the ministry.

In 2015, Anwar repeated claims that Daim had abused his power while in office and offered to cooperate if the Malaysian Anti-Corruption Commission  wished to commence a probe.

That same year, the Federal Court affirmed Anwar’s conviction and sentence by the Court of Appeal, sending him back to jail.

 

Sacked by Umno, Daim befriends Anwar

In 2015, Mahathir began criticising Najib over the 1MDB scandal. Mahathir resigned from Umno the following year.

Then, in a significant event on Sept 5, 2016 which changed the course of Malaysian politics, Mahathir turned up in a Kuala Lumpur courtroom where Anwar was and shook his hand. It was the first time they had met face-to-face in 18 years.

With Anwar still imprisoned, the former prime minister agreed to work with the opposition to topple the Barisan Nasional government led by Najib at GE 14.

Mahathir went on to assume the leadership of Pakatan Harapan, and Daim surfaced to campaign for it in the lead up to the polls.

That led to Daim being sacked by Umno on May 4, 2018, but five days later, PH made history by defeating BN to wrest control of Putrajaya.

One week later, Anwar was granted a full pardon by then Yang di-Pertuan Agong, Sultan Muhammad V, which effectively wiped out his entire criminal history of charges and convictions.

Anwar and Daim then appeared to have put the past behind them, meeting up on several occasions to discuss economic issues.

With Mahathir now prime minister again, Daim was made chairman of a five-member Council of Eminent Persons.

He also campaigned for Anwar in the lead up to a by-election in Port Dickson as Mahathir’s heir apparent, now widely recognised as the “prime minister in waiting”, plotted a return to the Dewan Rakyat.

Mahathir would later prevaricate on a pre-arranged transition which would have seen Anwar take over as prime minister.

That left Daim needing to deny claims that he had worked with Mahathir to prevent Anwar from taking over the top post, an allegation Anwar loyalist Abdullah Sani Abdul Hamid had made but later retracted.

Following the collapse of the PH government in February 2020, Daim retreated from public view, but would soon become the subject of public debate.

 

Pandora Papers, MACC probe, witch hunt?

In October 2021, the Pandora Papers were leaked, revealing details of offshore accounts held by past and present world leaders, including presidents, prime ministers, billionaires and prominent business people.

Daim was one of those named but denied any wrongdoing.

However, in February 2023, just three months after Anwar was appointed Malaysia’s 10th prime minister, MACC began probing Daim’s finances. He was ordered to declare his assets, and granted several extensions of the deadline to allow for compliance.

Then in December, MACC seized Ilham Tower, a  58-storey skyscraper owned by Daim’s family. Daim hit out at Anwar and MACC over the investigation, describing it as a “witch hunt”.

Anwar, however, denied any involvement in the probe, but said it was proof that the agency will spare no one, regardless of their background or position, in the war against corruption.

In January this year, Daim and wife, Naimah Khalid, were charged for failing to comply with the terms of asset declaration notices issued to them by the MACC. They pleaded not guilty.

Daim died in Assunta Hospital on Wednesday morning, about a month after he was admitted.

A heartbroken Mahathir mourned the passing of his friend, lamenting that Daim was not allowed to live out his final days in peace due to the accusations of wrongdoing levelled at him and his family.

The former prime minister said Daim’s decline in health was accelerated by the mistreatment he suffered at the hands of the authorities.