(AFP) Delegates from Umno's annual general meeting today hailed Prime Minister and party president Dr Mahathir Mohamad's opening speech in which he castigated fellow Malays for laziness, greed and ingratitude.

But one opposition leader called the speech xenophobic and "another classic example of Mahathir in denial".

The premier accepted no responsibility for the loss in UMNO's support in his speech.

In an strongly worded attack, he blamed Malays for ingratitude, wasting educational opportunities and squandering their special economic opportunities under an affirmative action programme.

Mahathir also accused foreign forces and the foreign media of plotting to recolonise Malaysia economically through globalisation.

Ali Mohamad, a veteran delegate from Johor, told AFP that Mahathir's "hard-hitting speech is a wake up call" to Malays to close ranks.

Ali, who has attended annual meetings for the last 20 years, said it was the premier's strongest-ever attack on Malays.

He said there were signs that Mahathir, 75, is preparing the stage to hand over power.

Malay struggle

Mohamad Yusof Mohamad Nor said some Malays and some UMNO members would feel insulted by Mahathir.

But the majority would hail his "brave" speech urging them to return to the path of Malay struggle.

Othman Abdul said the message was "that Malays must work hard to achieve economic success, they must be aware of the actual situation".

Normah Hanum Ibrahim said the premier was trying to rejuvenate Malays "who are still weak in education and business because of their own attitude of relying on government help and special privileges".

Lim Kit Siang, chairman of DAP, described the speech as "vintage Mahathir in his xenophobic rhetoric against the conspiracy of foreigners and their media out to impoverish and reduce Malaysia to a client state".

"It was another classic example of Mahathir in denial, putting the blame for the country and UMNO's woes on everybody ... but himself and his policies of the past two decades," said Lim in a statement.

Baseless allegations

In his speech, Mahathir also rejected criticism of his "mega-projects" and accusations of cronyism.

He acknowledged that UMNO, which has held power as the dominant coalition partner since independence in 1957, might become a minority Malay party in the next election, which must be held by 2004.

The premier accepted no responsibility for the loss in support.

"Aren't almost all the allegations against the government baseless?" he asked at one point.

He depicted UMNO as the only defender of Malay special rights and accused the opposition party PAS of willingness to barter those rights to win power.

Mahathir lamented the low intake of Malays into universities, adding that Malay children were no less intelligent than other races but "many Malay children are lazy and uninterested in studying".