The government denied the row between former premier Dr Mahathir Mohamad and his successor Abdullah Ahmad Badawi was damaging the country's reputation abroad.

"To them (other countries) the spat between the two are personal matters," the state Bernama news agency quoted Deputy Foreign Minister Joseph Salang as saying.

"As far as the leaders are concerned Abdullah's position as prime minister is not threatened since he has been duly elected and won the last general election with (an) overwhelming majority."

Salang also dismissed suggestions that foreign investors were being deterred by the row, which has rumbled all year and erupted into open hostilities in the past week.

"Nevertheless, the sooner the spat can be resolved between the two leaders, the better it is for the country in a lot of ways," Salang said.

Mahathir has said Abdullah is running a "police state". He has accused him of nepotism, corruption and economic mismanagement and has complained he is dismantling his own legacy, built up over 22 years in power.

Relinquish all posts, Dr M told

A senior figure in the ruling Umno, Kedah chief state minister Mahdzir Khalid, said, however, that Mahathir's conduct had been an embarrassment to the party, which had ruled for some four decades.

"I feel that the people of Kedah themselves are embarrassed by Tun's (Mahathir's) actions and will lose their respect for him," he said, according to Bernama.

Mahdzir called on the former premier to step down from his advisory posts in several government bodies such as national oil company Petronas, carmaker Proton and the Langkawi Development Authority.

"If (Mahathir) wants to bash the government, it would only be proper for him to relinquish all these posts and be an independent individual who has nothing to do with the government," he said.

Mahdzir also questioned Mahathir's allegation that Abdullah had turned Malaysia into a police state, noting that during Mahathir's tenure as prime minister no one had dared criticise him.

"He used his powers, he used the ISA (Internal Security Act) to arrest people, and now he says the country has turned into a police state," he said.