Malaysian ex-premier Mahathir and billionaire Soros end feud

Malaysia's former premier Mahathir Mohamad toay met his old foe George Soros and said he accepted the billionaire financier was not responsible for the 1997-98 Asian financial crisis.

Mr Mahathir has long blamed Mr Soros for undermining South East Asian economies by destabilising their currencies, and famously called him a "moron".

"Mr Soros said he was not involved in the devaluation of the Malaysian currency and that other people were involved. And I have accepted that," Mr Mahathir said at a joint press conference.

Mr Mahathir, who said he had a "very good discussion" with Mr Soros which also touched on conflict in the Middle East and the Palestinian situation, said he had wrongly been portrayed as anti-Semitic.

During the financial crisis he noted that Mr Soros was Jewish, and suggested that the crisis was the result of a plot by Jews who "are not happy to see Muslims progress".

"I would like to say this - that I have Jewish friends and many of my Jewish friends don't think I'm anti-Semitic but the press only pick on what I say against Israel and make it sound as if I'm against all Jews," he said.

Mr Mahathir and Soros appeared relaxed and cordial towards each other at the news briefing after the hour-long meeting - their first ever face-to-face encounter.

"We really did agree ... our view of the world is really very similar," Mr Soros said.

"And after we cleared up this misunderstanding of anti-Semitism, our views about the errors of the Bush administration (in its response to terrorism are) very similar", he said.

Both men, however, maintained their opposing views on currency speculation, with the 81-year old Mr Mahathir saying he is still against the practice which "destroys economies".

Mr Soros said he is "no longer" active in currency trading but defended currency speculators as traders who operate within the rules of financial markets.

"My view is that the responsibility doesn't belong to speculators but to the authorities. The authorities should decide how markets should function," he said.

The Hungarian-born philanthropist arrived in Malaysia on Thursday as part of a regional tour to promote his new book The Age of Fallibility

- AFP