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Why Malaysia Had Early Elections and What Is at Stake

Malaysia’s early general election was called to try to end the messy politics that have plagued the Southeast Asian nation since the historic defeat of the long-ruling Barisan Nasional coalition four years ago. The opposition alliance that pulled off that shock victory fell apart after 22 months due to infighting, leading to the BN’s eventual return to power. Still, with multiple coalitions in the race this time and millions of young people newly eligible to vote, the era of one party dominating the political landscape is long gone. Indeed, the Nov. 19 vote ended with a hung parliament, setting off rounds of horse trading as parties try to form a governing coalition.

1. What was at stake going in?

Prime Minister Ismail Sabri Yaakob and his fragile coalition sought to capitalize on recent wins in local polls and an opposition in disarray to improve on their four-seat majority in the 222-seat House of Representatives, with the vote coming almost a year ahead of schedule. A stronger mandate could have enabled the government to plow ahead with plans for budget cuts to improve public finances without having to make deals with the opposition -- or even suspend democracy as the last prime minister did. Malaysia is a major trading partner of both the US and China, but foreign policy received little mention in the race. However, the results matter a lot to ex-premier Najib Razak, who is serving a 12-year prison sentence for his role in the multibillion-dollar scandal related to state investment fund 1MDB. Najib has petitioned for a royal pardon, a move that his BN party supports, so a big role in the next government would improve the chances of it being granted. That would echo opposition leader Anwar Ibrahim’s pardon following his coalition’s victory in the 2018 election. 

2. Who are the players?

The main ones are:

• BN: Remodeled from the Alliance Front in 1973 after the 1969 race riots between ethnic Malays and Chinese, it has won 13 out of 14 previous elections. At the height of its power, BN comprised 14 parties, epitomizing the country’s identity politics and patronage system. The 1MDB scam finally turned voters against it. BN now consists of Ismail’s United Malays National Organisation (UMNO), the Malaysian Chinese Association, the Malaysian Indian Congress and the United Sabah People’s Party.

• Pakatan Harapan: This alliance, helmed now by Anwar, brought to an end BN’s dominance of Malaysia’s political landscape. Its victory then was hailed as a milestone for transparency, accountability and racial tolerance, but the government, led by UMNO veteran-turned-critic Mahathir Mohamad, collapsed due to defections. The coalition comprises the People’s Justice Party, the Democratic Action Party and the National Trust Party. It has also formed an electoral pact with newcomer Malaysian United Democratic Alliance, which won a single seat this year.

• Perikatan Nasional: The grouping comprises two main parties -- Bersatu and the Pan Malaysian Islamic Party -- and is led by former prime minister Muhyiddin Yassin. The pro-Malay, Islamist coalition increased its number of seats to 73 this year, from 39 lawmakers in the last parliament.

• Three small parties dominate on the island of Borneo. Gabungan Parti Sarawak won 23 seats, four more than in the last parliament; Gabungan Rakyat Sabah won six, down two; and Warisan Sabah just 3, down from seven. They are likely to partner with whomever wins the majority of seats in Peninsular Malaysia.

3. What are the issues?

Economic woes were front and center as Malaysians struggle with rising living costs, a weakening ringgit and concerns of a global slowdown next year. Some 70% of low-income households in a World Bank survey said they were unable to meet their monthly basic needs. Others include: 

• Stability: Every party promises to end the political squabbling that followed Mahathir’s resignation in 2020. BN has pledged to retain Ismail as prime minister and continue with the 2023 budget his government unveiled Oct. 7 -- three days before he dissolved parliament, paving the way for a new election.

• Corruption: The 1MDB scandal is expected to take a backseat following Najib’s prison sentence. Still, it remains ready ammunition for opposition parties as UMNO leaders including party president Ahmad Zahid Hamidi face dozens of pending corruption charges.

4. Any wild cards?

There were 5.8 million new voters after the government lowered the minimum voting age to 18 from 21 -- and made voter registration automatic. But about 67% of Malaysian Muslim youths in a recent survey by Merdeka Center said they weren’t interested in politics, and 77% said politics was too complicated to understand. 

5. How did Malaysia get here?

Mahathir, who was UMNO president for 22 years -- and Malaysia’s longest-serving prime minister -- until his retirement in 2003, buried the hatchet with Anwar long enough to end BN’s uninterrupted reign and send Najib to jail. But the bad blood between Mahathir and Anwar ran deep, and it didn’t take long before their feuding caused the collapse of the Pakatan Harapan government in 2020. Ironically, both leaders lost out to their own deputies -- Muhyiddin and Mohamed Azmin Ali -- who led enough defections to replace them with the Perikatan Nasional government. The Muhyiddin administration didn’t last and he too was replaced by UMNO’s Ismail in August last year.

6. What is the country’s outlook?

Despite the near-constant political instability and the damage inflicted by the pandemic, Malaysia has rebounded swiftly. Boasting one of the world’s fastest Covid-19 vaccination programs, the country surprised everyone by logging a 8.9% GDP expansion in the second quarter of 2022. The recently passed $80 billion spending plan for 2023 aims to cut taxes while still narrowing the fiscal deficit through more targeted subsidies. Higher energy prices this year have led to higher dividends from Malaysia’s state oil company Petroliam Nasional Bhd., which helped the government pay its ballooning subsidies bill. But the uncertainty over the fate of the budget has created fresh headwinds for the ringgit, already languishing at a 24-year low versus the dollar. A weak currency is bad news for Malaysia, a net food importer.

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