Malaysia coalition wins, but PM faces limited term
KUALA LUMPUR—Malaysian Prime Minister Najib Razak may have to step down by the end of the year, ruling party sources said on Monday, after his coalition extended its 56-year rule but recorded its worstever election performance.
Najib, 59, had staked his political future on strengthening the ruling coalition’s majority in parliament in Sunday’s general election on the back of a robust economy, reforms to roll back race-based policies and a $2.6 billion deluge of social handouts to poor families.
But he was left vulnerable to party dissidents after his Barisan Nasional won only 133 seats in the 222-member parliament, seven short of its tally in 2008 and well below the two-thirds majority it was aiming for.
It also lost the popular vote for the first time in 44 years, local media reported, underlining opposition complaints that the electoral system is stacked against it. Opposition leader Anwar Ibrahim’s People’s Alliance won 89 seats, up 7 from 2008 but well short of unseating one of the world’s longestserving governments.
Undermined by the result, Najib now faces a difficult task persuading his dominant United Malays National Organisation (UMNO) to press ahead with economic reforms and phase out policies favoring majority ethnic Malays over other races.
“We could see Najib step down by the end of this year,” said a senior official in UMNO, which leads the coalition.
“Hemay put up a fight, we don’t know, but he has definitely performed worse. He does not have so much bargaining power,” said the official, who spoke on condition of anonymity.
Former Prime Minister Mahathir Mohamad, still a powerful figure in UMNO, told Reuters last year that Najib must improve on the 140 seats won in 2008 or his position would be unstable.
Kuala Lumpur’s stock market surged nearly 8 percent in early trade to a record high on investor relief that the untested opposition had failed to take power, but later gave up some gains to trade 3.1 percent higher. The Malaysian ringgit jumped to a 20-month high.
Ethnic Chinese, who make up a quarter of Malaysians, continued to desert Barisan Nasional, accelerating a trend seen in 2008. They have turned to the opposition, attracted by its pledge to tackle corruption and end race-based policies, undermining the National Front’s traditional claim to represent all races in the nation of 28 million people.
MCA, the main ethnic Chinese party within the ruling coalition, only won seven seats, less than half its 2008 total.
Najib, the son of a former prime minister, said he had been taken by surprise by the extent of what he called a “Chinese tsunami.” Alarmingly for Najib, support from ethnic Malays also weakened, particularly in urban areas, a sign that middle-class Malays are agitating for change.
Najib, who polls show is more popular than his party, could face a leadership challenge as early as October or November, when UMNO members hold a general assembly and elect the party leader.
“In the next round of elections within UMNO, you will see some dissidents emerging and asking for Najib to resign,” said the official, who has held cabinet positions in government. He said Mahathir would be among those who back the dissidents.
Barisan Nasional also failed to win back the crucial industrial state of Selangor, near the capital Kuala Lumpur, which Najib had vowed to achieve.
“Najib is now leading a coalition that lost the popular vote, a coalition that will really struggle to prove its legitimacy,” said Wan Saiful Wan Jan, head of the Institute for Democracy and Economic Affairs in Kuala Lumpur.
“My feeling is it’s not going to be very easy for him.”
Investors had hoped that a strong mandate for Najib would enable him to push ahead with planned reforms such as subsidy cuts and a new consumption tax to reduce Malaysia’s budget deficit, which is relatively high at around 4.5 percent of GDP.