Malaysia began a countdown to the end of an era this year when Asia's longest-serving elected leader, Prime Minister Dr Mahathir Mohamad, surprised the nation by announcing that he will step down in October 2003 after 22 years in power.

When Mahathir became prime minister on July 16, 1981, Ronald Reagan was a rookie president of the United States, the Cold War dominated global politics and Malaysia was a sleepy Southeast Asian backwater with a commodities-based economy.

He hands over to Deputy Prime Minister Abdullah Ahmad Badawi at a time when the son of Reagan's successor holds power in the United States, terrorism is seen as the main threat to world peace, and Malaysia is in the manufacturing mainstream.

Since 1981, government here has been something of a one-man show, with Mahathir's stamp of approval vital to everything from the running of the economy to cleanliness in public toilets, and for some his departure was unimaginable.

This was demonstrated by the bizarre nature of his unexpected resignation speech at the ruling Umno congress in June.

The 76-year-old premier was mobbed by protesting cabinet ministers before he could finish, burst into tears, was hustled into a back room and took off the next day on a European holiday, leaving a stunned nation wondering what was going on.

Mr Nice guy

Within days it was confirmed that he would quit, although not immediately as he had planned. He would stay on to host the summits here of the Non-Aligned Movement in February and the Organisation of the Islamic Conference in October.

Once the initial shock had worn off and the nation had been assured there would be a smooth transition of power and no major policy upheavals, the markets settled down and people began to take stock of Mahathir's anointed successor.

Abdullah Ahmad Badawi, 62, is often called "Mr Nice Guy", but he faces a huge task in convincing the nation that he can step into Mahathir's shoes.

He has pledged to continue his mentor's policies, but there is no doubt the style will be different.

Mahathir is outspoken and confrontational, well-known for his frequent criticisms of the West and equally prepared to chide his own Malay people for being lazy, while Abdullah is seen as a quieter, team player.

Analysts say Abdullah, who has no experience in economic management, is unlikely to change any of Mahathir's business policies which have brought dramatic growth to the country.

Better ties with neighbours

His foreign policy is likely to focus on enhancing political ties and trade with Southeast Asian nations, the United States and Japan, and it is possible he will be less critical of Australia.

Mahathir has regularly spurned Australia's attempts to be accepted as "Asian" in political forums, and recently chided Prime Minister John Howard for acting as "deputy sheriff" to the United States in the region.

On human rights issues, for which Mahathir was regularly criticised, analysts see little chance of Abdullah doing away with the hated Internal Security Act (ISA), which allows for indefinite detention without trial.

Abdullah, who is currently also home minister in charge of security, has in the past year approved the detention of scores of alleged Muslim militants, many suspected of membership in the Jemaah Islamiah terrorist network accused of the Bali bomb blast in October.

Apart from the terrorist threat, Abdullah's major legitimate political challenge will come from the opposition PAS, a hardline Muslim group which wants to turn multicultural Malaysia into a theocratic Islamic state.

Abdullah has strong religious credentials, having majored in Islamic studies at University Malaya, but this is unlikely to make much impression on the country's more militant Muslims as long as he upholds the secular nature of the constitution. AFP