Former deputy premier Anwar Ibrahim warned that the country's economy would head towards disaster if its competitiveness continues to plummet.

"Please believe me, I was a finance minister. The state of the Malaysian economy is not good now, we are going to face big problems," he told some 4,000 people at a dinner event in Ipoh last week.

"Now there is a big deficit, foreign investment do not come in, we fail in competitiveness. We ' mo lui ' (which in Hakka means 'no money'), we have a problem now," he told the predominantly Chinese audience.

Anwar, who was finance minister from 1991 up until his sacking in 1998, stressed that it was important to have policies that were fair and allow competitiveness.

"Our world competitiveness has dropped. When I was a finance minister, the index was at No 14, but now it dropped to 30-odd, yet people say I am not clever," he quipped, adding that some unethical practices must be stopped.

"Most of the projects get the money first (before work commences). I know about this, Chinese leaders know about this. We must stop this now, otherwise we will lose our competitiveness," he said.

The politician, who spent six years in jail for corruption charges, also claimed that the share allocation he approved to be dispersed to poor Malaysian Indians had 'gone missing'.

According to the World Economic Forum's (WEF) Global Competitiveness Report for 2004, Malaysia's global competitiveness ranking slipped two spots from 29th in 2003 to 31 this year.

No regrets

Anwar, who was acquitted of his sodomy charge on Sept 2, also emphasised on the importance to weed out corruption as this weakened economic performance.

"A Chinese friend who is doing business told me, 'What can we do? If we don't give bribe, we cannot get license? If no corruption, then I cannot get contracts, so ' cincai cincai biau kin lah ' (Hokkien for 'just let it be, it's ok')

"I answered him it's the officers' duty to approve the license, they have been paid to approve, so why do you have to pay again?" said Anwar, who drew laughter from his audience with his colloquial Malay and Chinese.

On a more serious note, the former deputy premier said he had paid a heavy price for crusading against corruption.

Referring to his assault in the hands of former inspector-general of police Rahim Noor, Anwar said even by holding a post at the highest echelons of the government did not spare him from being beaten 'almost to death'

"If I, a deputy premier, got this (assaulted), someone else will get it too. So please do not say it will never happen to you," he added.

He said that he also does not regret having been jailed for battling corruption.

"Outsiders say 'Anwar you are stupid'. If you were clever, you would have followed the way of 'little' corruption and bail-outs, and now you would have already been the premier.

"But I tell you I have no regrets as the rakyat now are stronger and more willing to change," he said to a rousing applause and chants of 'reformasi'.