Malaysian Premier Quits, Then Rethinks

KUALA LUMPUR, Malaysia -- Malaysian Prime Minister Mahathir Mohamad's retraction of his shock resignation on Saturday was only to give other party leaders time to work out the transition of power, a senior ruling party source said.

Asia's longest serving leader believed the time was right to step down after 21 years in power and he would be going through with his resignation, the source in the United Malays National Organization, or UMNO, told Reuters.

Deputy Prime Minister Abdullah Ahmad Badawi would take over the premiership at some point soon, the question was when, the source, who requested anonymity, said.

The 76-year-old Mahathir flew to Italy for a 10-day holiday on Sunday after a meeting with other UMNO leaders.

The ruling Barisan National coalition, meanwhile, was to hold a supreme council meeting to clarify the political situation, the official Bernama news agency said.

Bernama said Abdullah had told reporters that the meeting would take place "as soon as possible" so as to allay any confusion about Saturday's events.

UMNO sources said they expected the supreme council to meet either later on Sunday or Monday to agree on a statement.

A sobbing Mahathir rocked the UMNO general assembly on Saturday by announcing he was quitting all party and coalition posts. The speech was carried live on national television.

Within an hour Abdullah and other party leaders had talked him into withdrawing the resignation, but sources say Mahathir told them privately he was adamant he would hand over power.

The other key issue to be resolved is who takes over from Abdullah as deputy prime minister. Two strong candidates are Defense Minister Najib Tun Razak and Domestic Trade Minister Muhyiddin Yassin.

Najib refused to comment on events on Sunday, saying it was up to Abdullah to issue any statement.

But UMNO leaders, led by Abdullah, were busy paying respects to an opposition leader, Parti Islam se-Malaysia president Fadzil Noor, who died on Sunday.

Analysts said Mahathir would have resigned only if he was sure that Malaysia would not suffer the chaos seen in the Philippines and Indonesia, when their strongman leaders Ferdinand Marcos and Suharto fell from power.

Diplomats said they were puzzled why Mahathir had resigned and then retracted if he really intended to go. It would appear a messy way of bowing out for one of Asia's wiliest politicians.

His support for the U.S.-led war on terror and reputation as a strong moderate Muslim leader raised Mahathir's standing in the West after the September 11 attacks on the United States.

Another diplomat said Mahathir's early exit would help Abdullah take over smoothly, whereas the deputy's position could become more difficult if Mahathir chose to overstay.

"I'd be surprised if they didn't fall in line behind Abdullah in the short term at least," he said, referring to other leaders in UMNO who had ambitions for the top job.