Malaysia's Daim, reformist ex-finance minister, dies at 86

By Ashley Tang, Danial Azhar

KUALA LUMPUR (Reuters) -Malaysia's Daim Zainuddin, an influential two-times finance minister who led major economic reforms and helped steer the Southeast Asian nation through recessions and the Asian financial crisis, died on Wednesday, his family said.

The 86-year-old, who was credited with investor-friendly policies and privatisation of state-owned firms under former Prime Minister Mahathir Mohamad, died at a hospital on the outskirts of Kuala Lumpur, the family said in a statement.

It did not give a cause of death.

"In the past few weeks, he was in the intensive care unit after he had a stroke," said his lawyer, Gurdial Singh Nijar, adding that he did not know the cause of death.

As finance minister from 1984 to 1991 and then from 1999 to 2001, Daim was key to Mahathir's vision of transforming Malaysia into a modern industrial nation, helping to draw in foreign investment and spur economic growth that reached 9.06% in 1989.

"I have lost a friend who fought with me for race, country and religion," the 99-year-old Mahathir said in a statement, adding that he was "immeasurably saddened".

Daim's second stint as finance minister followed Mahathir's defiance of advice from the International Monetary Fund in response to the Asian financial crisis of 1997, imposing capital controls and pegging the ringgit currency to the dollar in 1998.

Even after retiring, Daim remained an influential figure. In 2018, when Mahathir returned as prime minister, he appointed Daim to lead a state advisory council tasked with scrutinising government policies and management of state-linked firms.

ASSETS PROBE

But in his last years, the lawyer-turned-businessman came under the spotlight for his asset declarations, having had substantial interests in sectors from banking to property.

Malaysia's anti-graft body began investigating Daim in 2023 over information in the Pandora Papers, a massive leak of financial records that revealed offshore assets held by politicians and public figures worldwide.

In it, Daim, his associates and family were reported to have held assets worth at least 25 million pounds ($32 million). He said not all the assets were his and he had broken no laws.

Daim was charged this year with failing to disclose assets in one of the most high-profile cases of a graft crackdown by the government of Prime Minister Anwar Ibrahim, a longtime rival of Mahathir. He pleaded not guilty.

Assets including his family's 60-storey Ilham Tower in the capital, Kuala Lumpur, were seized.

Anwar has denied critics' accusations that he has used the anti-graft agency to target political rivals.

Anwar, who was replaced by Daim as finance minister in 1999 after being sacked by Mahathir for alleged corruption and sodomy, offered condolences to the family.

"The government recognises his service and contributions to the country, especially when he was finance minister," Anwar said on Facebook.

(Reporting by Danial Azhar and Ashley Tang; Editing by John Mair, Clarence Fernandez, Martin Petty)