From the Economist Intelligence Unit ViewsWire
Malaysia's ruling coalition is likely to stay in power
Malaysians are likely to turn out in record numbers to vote in the general election on March 8th. Increased political awareness, coupled with a seemingly competent opposition, has energised the electorate and led to frenzied campaigning across the country. Given the dissatisfaction with the current government over a range of issues, the opposition should win more of the vote than it did the last time. Nevertheless, the ruling Barisan Nasional (BN, the National Front) coalition should still be too strong for the opposition and should keep its two-thirds majority in parliament. The incumbent prime minister Abdullah Badawi, will also remain in power. In that sense, the election should usher in much-needed stability, following months of political uncertainty marked by street protests and a slew of scandals involving the government.
Why now?
Even though elections had not been due until April 2009, with economic clouds gathering in the US and the domestic political scene likely to become less favourable for the government, Mr Abdullah had an incentive to call an early election. By holding the polls now, Mr Abdullah has prevented Anwar Ibrahim, a former deputy prime minister and the de facto leader of the opposition Parti Keadilan Rakyat (PKR, People's Justice Party), from taking part. Mr Anwar is barred from running for public office until April 2008 owing to an earlier conviction for corruption. He could, however, still seek entry to parliament by contesting a by-election after that. In fact, several opposition politicians, including Mr Anwar's wife, Wan Azizah, have promised that if they are elected they will duly step down in April to allow Mr Anwar to contest their seat.
The strongest rationale for the government to call an early election is to secure another five-year term before economic conditions deteriorate. Exports account for around 110% of GDP, so the prospect of a sharp slowdown in the US—Malaysia's most important overseas market—means that the economy is likely to face more challenging conditions in 2008. In addition, civil-service and police pay rises are still fresh in the minds of more than 1m people, who received pay increases ranging from 7.5% to 35% last July. The government stuck to its pledge of not trimming the subsidy on fuel prices in 2007, but it will find this policy difficult to maintain with international oil prices remaining high. All of this means that voters would probably have had greater reason to be unhappy about their financial well-being the longer Mr Abdullah had waited to go to the polls.
Why the opposition is in a strong position…
Over the past few months, protests organised by Hindraf (Hindu Rights Action Force) and Bersih (a coalition of human rights groups and opposition political parties pushing for electoral reform) have altered the political climate, revealing a level of dissent not seen since the Reformasi movement in 1998. There certainly seems to be a groundswell of discontent amongst the ethnic minority communities. The Hindraf protests have brought to the fore long-standing grievances about the country's institutionalised affirmative-action policies that give preference to the Muslim Malay majority—the so-called bumiputeras (sons of the soil). What's more, many segments of Malaysian society appear dissatisfied with the ruling coalition after years of perceived corruption and mismanagement. There is a feeling that while the bumiputera policies have enriched government officials and cronies, the programme has not helped ordinary Malays—in particular the lower-income group, the main purported beneficiaries—as much as it should have. The ruling coalition has also been hit by a series of scandals over the past few months.
While the BN has been beset by problems, the opposition parties appear to be more united this time around than at the last election. This is mostly due to the efforts of Mr Anwar, who has formed strategic alliances between unlikely bedfellows. The three main opposition parties are the PKR, the Democratic Action Party (DAP) and the Parti Islam sa-Malaysia (PAS), an Islamic party that had, until quite recently, pushed for the setting up of an Islamic state in Malaysia. Given their ideological differences, the three parties have not formed an official alliance, which their respective supporters would not have been comfortable with. However, with a few exceptions, they have agreed not to contest the same seats, paving the way for more two-way fights with the BN.
The increased penetration of technology has also added a new dimension to these elections, as it has allowed the opposition to communicate with Malaysians in spite of the government's stranglehold on major media channels. The political blogosphere has exploded over the past few years. The opposition also successfully disseminates news of upcoming ceramahs (public speeches) via the Internet and SMS.
…but why the ruling coalition is still too strong
With all this unhappiness in the air, will Malaysians vote in a new government? That is unlikely. The majority of voters will continue to vote along ethnic and religious lines, and in those constituencies where Malays make up more than 80% of the voters they will vote the BN back in. While the recent protests may have increased political awareness among Chinese and Indian voters, they have probably strengthened the resolve of many Malays to vote for the BN so that the affirmative-action policy can continue.
The Chinese in the country—about 24% of the voters—have traditionally split their votes between the ruling coalition and the opposition, and are likely to do so again. While there is a growing uneasiness about their place in society, many Chinese have prospered financially in Malaysia, and they like the political and economic stability that has come with BN rule.
The big change will come in the Indian vote, in particular the 80% of Indians who are lower-income Tamils. Indians have traditionally supported the ruling coalition en masse. That is set to change. In the eyes of many, the Malaysian Indian Congress (MIC), the Indian party in the ruling BN coalition, and its leader, Samy Vellu, have not done enough for the community. According to the Merdeka Centre, an NGO in Malaysia, Indian support for Mr Abdullah dropped from 79% in October last year to just 38% by the middle of December.
However, Indians only make up about 8% of the population; and in some constituencies the percentage of Indian voters is less than 5%. They are unlikely to make much of an electoral impact. According to Denison Jayasooriya, a political analyst who specialises in Indian affairs, Indian voters could make a difference in 62 of the 222 parliamentary seats being contested. However, even if the opposition won all of those, it could not deny the BN its two-thirds majority.
What is likely to happen
The Economist Intelligence Unit expects the ruling coalition to win, and to maintain a two-thirds or better majority in parliament. In 2004 the BN won 63.9% of the popular vote, and 90.4% of the seats (198 of 219) up for grabs. This time, we expect the opposition to win at most 50 seats, which would still leave the ruling coalition with 77% of the seats (172 of 222). The BN's share of the popular vote could fall to as low as 55%, which would be a clear indication of voter dissatisfaction. However, to put things in perspective, that would still be more than in the 1990 elections, when it won just 53.4% of the vote. Even with the reduced mandate, the then prime minister, Mahathir Mohamad, was able to carry on with his economic agenda. Therefore, a drop in the BN's share of the vote in this election is unlikely to disrupt the present administration's social and economic programmes. However, the vote would be a signal to the BN's leaders that they have to pay closer attention to the concerns of Malaysians.
What if?
In the unlikely event that the BN fails to secure a two-thirds majority in parliament, or that the parliamentary make-up is not settled after the elections—say, if Mr Anwar appears to be plotting a return once his ban expires—then lingering political uncertainty could have an adverse effect on domestic demand and foreign-investor sentiment. Of particular worry is the fact that many of the opposition's candidates are greenhorns—young starlets with impressive resumes but precious little political experience (in part because the BN's dominance has kept them out of power). If too many of them assume office, Malaysia's government could be hampered by fractious political skirmishing. Still, voters who have long felt uneasy about the BN's political dominance would at least have something new to complain about.
Malaysians are likely to turn out in record numbers to vote in the general election on March 8th. Increased political awareness, coupled with a seemingly competent opposition, has energised the electorate and led to frenzied campaigning across the country. Given the dissatisfaction with the current government over a range of issues, the opposition should win more of the vote than it did the last time. Nevertheless, the ruling Barisan Nasional (BN, the National Front) coalition should still be too strong for the opposition and should keep its two-thirds majority in parliament. The incumbent prime minister Abdullah Badawi, will also remain in power. In that sense, the election should usher in much-needed stability, following months of political uncertainty marked by street protests and a slew of scandals involving the government.
Why now?
Even though elections had not been due until April 2009, with economic clouds gathering in the US and the domestic political scene likely to become less favourable for the government, Mr Abdullah had an incentive to call an early election. By holding the polls now, Mr Abdullah has prevented Anwar Ibrahim, a former deputy prime minister and the de facto leader of the opposition Parti Keadilan Rakyat (PKR, People's Justice Party), from taking part. Mr Anwar is barred from running for public office until April 2008 owing to an earlier conviction for corruption. He could, however, still seek entry to parliament by contesting a by-election after that. In fact, several opposition politicians, including Mr Anwar's wife, Wan Azizah, have promised that if they are elected they will duly step down in April to allow Mr Anwar to contest their seat.
The strongest rationale for the government to call an early election is to secure another five-year term before economic conditions deteriorate. Exports account for around 110% of GDP, so the prospect of a sharp slowdown in the US—Malaysia's most important overseas market—means that the economy is likely to face more challenging conditions in 2008. In addition, civil-service and police pay rises are still fresh in the minds of more than 1m people, who received pay increases ranging from 7.5% to 35% last July. The government stuck to its pledge of not trimming the subsidy on fuel prices in 2007, but it will find this policy difficult to maintain with international oil prices remaining high. All of this means that voters would probably have had greater reason to be unhappy about their financial well-being the longer Mr Abdullah had waited to go to the polls.
Why the opposition is in a strong position…
Over the past few months, protests organised by Hindraf (Hindu Rights Action Force) and Bersih (a coalition of human rights groups and opposition political parties pushing for electoral reform) have altered the political climate, revealing a level of dissent not seen since the Reformasi movement in 1998. There certainly seems to be a groundswell of discontent amongst the ethnic minority communities. The Hindraf protests have brought to the fore long-standing grievances about the country's institutionalised affirmative-action policies that give preference to the Muslim Malay majority—the so-called bumiputeras (sons of the soil). What's more, many segments of Malaysian society appear dissatisfied with the ruling coalition after years of perceived corruption and mismanagement. There is a feeling that while the bumiputera policies have enriched government officials and cronies, the programme has not helped ordinary Malays—in particular the lower-income group, the main purported beneficiaries—as much as it should have. The ruling coalition has also been hit by a series of scandals over the past few months.
While the BN has been beset by problems, the opposition parties appear to be more united this time around than at the last election. This is mostly due to the efforts of Mr Anwar, who has formed strategic alliances between unlikely bedfellows. The three main opposition parties are the PKR, the Democratic Action Party (DAP) and the Parti Islam sa-Malaysia (PAS), an Islamic party that had, until quite recently, pushed for the setting up of an Islamic state in Malaysia. Given their ideological differences, the three parties have not formed an official alliance, which their respective supporters would not have been comfortable with. However, with a few exceptions, they have agreed not to contest the same seats, paving the way for more two-way fights with the BN.
The increased penetration of technology has also added a new dimension to these elections, as it has allowed the opposition to communicate with Malaysians in spite of the government's stranglehold on major media channels. The political blogosphere has exploded over the past few years. The opposition also successfully disseminates news of upcoming ceramahs (public speeches) via the Internet and SMS.
…but why the ruling coalition is still too strong
With all this unhappiness in the air, will Malaysians vote in a new government? That is unlikely. The majority of voters will continue to vote along ethnic and religious lines, and in those constituencies where Malays make up more than 80% of the voters they will vote the BN back in. While the recent protests may have increased political awareness among Chinese and Indian voters, they have probably strengthened the resolve of many Malays to vote for the BN so that the affirmative-action policy can continue.
The Chinese in the country—about 24% of the voters—have traditionally split their votes between the ruling coalition and the opposition, and are likely to do so again. While there is a growing uneasiness about their place in society, many Chinese have prospered financially in Malaysia, and they like the political and economic stability that has come with BN rule.
The big change will come in the Indian vote, in particular the 80% of Indians who are lower-income Tamils. Indians have traditionally supported the ruling coalition en masse. That is set to change. In the eyes of many, the Malaysian Indian Congress (MIC), the Indian party in the ruling BN coalition, and its leader, Samy Vellu, have not done enough for the community. According to the Merdeka Centre, an NGO in Malaysia, Indian support for Mr Abdullah dropped from 79% in October last year to just 38% by the middle of December.
However, Indians only make up about 8% of the population; and in some constituencies the percentage of Indian voters is less than 5%. They are unlikely to make much of an electoral impact. According to Denison Jayasooriya, a political analyst who specialises in Indian affairs, Indian voters could make a difference in 62 of the 222 parliamentary seats being contested. However, even if the opposition won all of those, it could not deny the BN its two-thirds majority.
What is likely to happen
The Economist Intelligence Unit expects the ruling coalition to win, and to maintain a two-thirds or better majority in parliament. In 2004 the BN won 63.9% of the popular vote, and 90.4% of the seats (198 of 219) up for grabs. This time, we expect the opposition to win at most 50 seats, which would still leave the ruling coalition with 77% of the seats (172 of 222). The BN's share of the popular vote could fall to as low as 55%, which would be a clear indication of voter dissatisfaction. However, to put things in perspective, that would still be more than in the 1990 elections, when it won just 53.4% of the vote. Even with the reduced mandate, the then prime minister, Mahathir Mohamad, was able to carry on with his economic agenda. Therefore, a drop in the BN's share of the vote in this election is unlikely to disrupt the present administration's social and economic programmes. However, the vote would be a signal to the BN's leaders that they have to pay closer attention to the concerns of Malaysians.
What if?
In the unlikely event that the BN fails to secure a two-thirds majority in parliament, or that the parliamentary make-up is not settled after the elections—say, if Mr Anwar appears to be plotting a return once his ban expires—then lingering political uncertainty could have an adverse effect on domestic demand and foreign-investor sentiment. Of particular worry is the fact that many of the opposition's candidates are greenhorns—young starlets with impressive resumes but precious little political experience (in part because the BN's dominance has kept them out of power). If too many of them assume office, Malaysia's government could be hampered by fractious political skirmishing. Still, voters who have long felt uneasy about the BN's political dominance would at least have something new to complain about.
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