Use dollar to bring US to its senses, says Mahathir

Countries which opposed "bullying" by the United States should use the dollar to bring the administration to its senses, Dr Mahathir Mohammad said in Dubai yesterday.

The former prime minister of Malaysia said the American giant had "feet of clay" and its weakest point was the mighty dollar. In an interview at the Leaders in Dubai conference, Mahathir, 78, said the US "owes huge sums of money to the rest of the world".

Countries which opposed US policies should refuse to accept dollar payments for their exports and insist on being paid in, for example, euros or yen.

"There are countries which can literally defy the US and get away with it. [They] can say ‘We are not dealing with the US dollar. If the US wants to buy our oil they must pay in euros or the yen'," he said.

Muslim and Arab leaders had many advantages, such as fuel and economic muscle, Mahathir said. "If they are well managed it will prevent the kind of bullying that happens in the world."

Such a decision would require political will, he said. "There is a way of doing things, but if you do not have the will the best way of doing things will not happen," Mahathir added.

The US was a deficit state "living on borrowed money".

"If people do not keep giving money to the US it will go bankrupt," he said. "Why are we clinging to the US dollar when we know we are going to lose money?"

Mahathir said Malaysia had avoided losses to its reserves despite the decline in the value of the dollar by building its euro and gold holdings.

Mideast not ready for democracy

The Middle East was not yet ready for democracy, Dr Mahathir said yesterday.

"Democracy is a process that took Europe almost 200 years to work out. To tell a country that tomorrow you must be democratic is really to destroy that country," he said at the Leaders in Dubai conference.

"Change is always disruptive, even change for the good. But when you are changing something to a system people are not familiar with, they are bound to bungle things. So give them time, not over-night."