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Malaysian PM says currency controls were only his second choice

KUALA LUMPUR, May 2 (AFP) - Malaysian Prime Minister Mahathir Mohamad initially planned to beat currency speculators with a radical plan for universal pay and price rises, it was disclosed Tuesday.

Mahathir said in a newspaper column that the controversial currency controls he introduced in September 1998 were only his "second idea" for defeating speculators driving down the value of the ringgit.

He said his first idea, which was rejected by the National Economic Action Council, was "to increase the income of everybody and raise the prices of everything in order to neutralise the devaluation.

"If the value of the currency fell by 100 percent in terms of exchange rate then we would raise income by 100 percent," he wrote in his monthly column for Japan's Mainichi Daily News.

"This would result in the purchasing power remaining the same. But such action has a lot of side-effects. While it would help people's ability to buy imports, inflation may become uncontrollable...My colleagues shot down the plan."

The currency controls, subsquently eased, were initially strongly criticised but later won greater international acceptance.

Mahathir, whose column was reprinted in Tuesday's New Straits Times, also indicated he was in no hurry to retire and imparted some tips for beating stress.

The 74-year-old leader, in power since 1981, said after last November's election that this would be his last term in office.

There has been speculation he may step down before his term expires. He need not call an election till 2004.

Mahathir recalled his 1989 heart attack which required a quadruple bypass operation and said he was glad he made no decision about retiring at that time.

"Now I feel capable of carrying on and I do not really feel too much under tension. I have always been able to relax and find sleeping easy.

"While flying or being driven to any destination I would doze off and this helps me to recover my strength, both physical and mental," he wrote.

The premier said he experienced tension when currency controls were introduced and when he sacked his deputy and finance minister Anwar Ibrahim the following day.

Mahathir said the way to lessen tension was to be convinced a decision was correct and "I feel quite relaxed most of the time.

"Like everyone else I do get sick but nothing so serious as to force me to retire."