Malaysia needs ASEAN to navigate a pathway between ‘the West’ and ‘the rest’

This piece was first published on the East Asia Forum site on 18 August 2024 here. Its editorial, titled “Malaysia mustn’t waste its moment of regional leadership”, also refers to the piece here.

As ASEAN chair in 2025, Malaysia has a critical opportunity for leadership at time when geopolitics threaten regional stability and prosperity. Deploying ASEAN centrality to restore the region’s influence and secure the momentum of its development is its primary task. But there are questions about the country’s strategic priorities as Prime Minister Anwar Ibrahim’s diplomacy has seemed to tilt towards China and, more recently, Russia.

The risk is that Malaysian leadership is being derailed by a ‘the West’ against ‘the rest’ narrative when regional geopolitics is in reality a story of complex and competing dangers and opportunities on all sides through which ASEAN has to navigate its own pathway.

During Chinese Premier Li Qiang’s visit to Malaysia in June 2024, commemorating the 50th anniversary of China–Malaysia diplomatic ties, Malaysia reiterated its support for China’s Belt and Road Initiative (BRI). A joint press statement also welcomed Beijing’s application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Malaysia reaffirmed its ‘firm commitment’ to the ‘One China Policy’ and opposition to Taiwanese independence.

In July, Anwar announced that Malaysia had formally applied to join the intergovernmental organisation, the BRICS, of which Russia currently is president — a nine-country bloc including China and India representative of ‘the rest’. He is also planning a visit to Vladivostok to meet Russian President Vladimir Putin to discuss economic cooperation.

On Chinese media outlet Guancha he said that Malaysia ‘can no longer accept the scenario where the West wants to control the discourse because the fact is they are not colonial powers anymore and independent countries should be free to express themselves.’

Anwar’s perceived tilt towards China reflects widespread domestic sentiment, which he is never shy about expressing.

July survey conducted by the Pew Research Center found that 64 per cent of Malaysians held a favourable opinion of China, while 57 per cent viewed Russia favourably, up 10 percentage points from 2022. Sixty one per cent even expressed confidence in Russian President Vladimir Putin’s foreign policy.

The Israel–Hamas war has also deepened Malaysian resentment of US foreign policy. Anwar has taken strong positions against Israel on the international stage including by maintaining ties with Hamas. If ‘all politics is local’, then Anwar is likely responding to the increasing political competition from his coalition government’s rival, the National Alliance, comprised of two conservative Malay-Muslim parties.

Some of Anwar’s statements appear as grandstanding rhetoric. Malaysia continues to foster deep economic ties with other major powers including the United States, the European Union and Japan — its third-, fourth- and fifth-largest trading partners in 2023. US investment into Malaysia reached US$13.2 billion in 2022, up 4.6 per cent from 2021. The United States and Malaysia also enjoy a strong defence partnership.

Malaysia participates in the US-led Indo-Pacific Economic Framework for Prosperity (IPEF), the CPTPP whose commission is currently chaired by Canada, and crucial semiconductor supply chains linked with the West and Taiwan. As a small and historically open trading nation, Malaysia favours economic ties with all major powers.

Malaysia’s ‘grand strategy’ thus appears quite opaque. An articulation of strategic priorities may be urgent but still absent. It is important to be clearer about the region’s role in the current geopolitical environment.

While both security and drivers of growth like foreign investment are important, Malaysia needs to renew its commitment to the global rules and uphold principles of free and fair trade based on regional institutional governance — key to ensuring the domestic economy remains robust and resilient.

Malaysia could, for example, demonstrate such commitments by signing up to the Multi-Party Appeal Arbitration Arrangement (MPIA) — a framework allowing members to resolve World Trade Organization (WTO) disputes since the WTO’s Appellate Body ceased functioning because of a US veto on the appointment of Appellate judges — and encourage others in ASEAN to do the same. Ensuring the Digital Economic Framework Agreement (DEFA) is signed and implemented ahead of 2025 is also a priority.

Malaysia can also work to translate its commitments under the CPTPP and the Regional Comprehensive Economic Partnership (RCEP) into meaningful national and regional benefits.

Malaysia should lead efforts to manage disputes in the South China Sea, especially given the increasing division between the Philippines, Vietnam and Malaysia. As the architect of Myanmar’s entry into ASEAN, Malaysia must also do more to engage that state. Countries like Malaysia can share important lessons from its own experience of federalism and decentralisation as Myanmar explores new models of governance.

As domestic discussions about carbon pricing ramp up, Malaysia is well-positioned to lead on regional climate change policies and initiate dialogue on a regional carbon credit trading scheme. It can also lead on the business and human rights agenda, building on its work in developing a national action plan based on the United Nations Guiding Principles on Business and Human Rights in a space where only Thailand in Southeast Asia has so far had some success.

The question is whether Malaysia’s leadership can engage a more constructive approach on strengthening ASEAN, eschewing a diplomacy that appears hooked on merely belittling the West.

The region has potential as an attractive geopolitical and economic partner that other blocs cannot ignore. As the host of the first-ever East Asia Summit in 2005, Malaysia has a unique legacy and new responsibility to reinvigorate the East Asian arrangements as a platform for mitigating security risks while promoting a rules-based order.

While grappling with local sentiment is a political necessity, it’s time for Malaysia to strike a better balance between international partners and their competing economic and security interests. Grasping ASEAN’s collective strengths and demonstrating them through a concrete policy agenda offers Malaysia the chance of regional leadership when it is most sorely needed.

Tricia Yeoh is CEO of the Institute for Democracy and Economic Affairs (IDEAS), Malaysia, Visiting Senior Fellow at ISEAS-Yusof Ishak Institute and Campus Visitor at The Australian National University.https://doi.org/10.59425/eabc.1724018400

Posted in Economics, General Politics, International Relations, Outside Malaysia | Leave a comment

Malaysia’s States: Open for Business, Yet Not Always Transparent

This op-ed was first published on Fulcrum, a platform under ISEAS-Yusof Ishak Institute on 12 August 2024 here. This was written as part of my 6-month fellowship with ISEAS-Yusof Ishak Institute.

Malaysia is enjoying strong inflows of foreign direct investment. To up its game, it needs to channel such flows to less-developed states.

Prime Minister Anwar Ibrahim announced recently that Malaysia had attracted potential foreign direct investments (FDI) of RM76.1 billion (US$17.2 billion) as of March 2024. The first-quarter performance follows investments of RM329.46 billion in 2023. However, FDI remains concentrated in more industrialised states such as Penang and Selangor. For lesser-developed states to benefit from FDI flows, they would need to up their game in terms of transparency and oversight.

Recent investment pledges include Intel’s RM30 billionTexas Instruments’ RM14.6 billionMicrosoft’s RM10.5 billion and Google’s RM9.4 billion in manufacturing and digitalisation activities. While these investments are positive, they mostly benefit highly developed and industrialised states such as Selangor, Kuala Lumpur, and Penang. The 2023 statistics showed Penang leading in total capital investment, followed by Kuala Lumpur and Selangor. These states benefit from valuable resources such as land, talent and infrastructure. Kuala Lumpur and Selangor are centrally located, with major airports, ports, and higher education levels.

There are, however, pressing problems. At the Selangor ASEAN Business Conference 2024, state chiefs of Selangor and Penang expressed serious concerns over the lack of industrial land. Penang has limited industrial land, and 31 per cent of Selangor is reserved as permanent forest. To increase FDI further, Malaysia faces a two-pronged problem: the problem of land saturation in highly developed states, and the need for lesser-developed states to attract foreign investors.

How can lesser-developed states do so when there is significant variation between states in economic competitiveness? Not all states have advantages like geography (Selangor, Kuala Lumpur, Johor), natural resources (rare earths in Perak and Pahang, oil and gas in Kelantan, Terengganu, Sabah and Sarawak) and high levels of industrialisation (Penang, Selangor and Kuala Lumpur). Only a handful of states such as Selangor and Johor have well-performing State Economic Development Corporations (SEDCs), which own large plots of land and industrial parks. Further, past practices on water services have an impact on the price users pay in each state.

For states that have less competitive advantages yet are competing to attract investment, even marginal value-add may make a big difference. For instance, very few state governments transparently publish their full state budgets  and changing this could be a low-hanging fruit. While most state government budgets are small relative to the federal budget, this could be a step for states to demonstrate seriousness in good governance as a principle and practice.

In a recent Malaysia Open Budget Index (MyOBI) 2024 report published by the Institute for Democracy and Economic Affairs (IDEAS), it was found that Terengganu and Selangor tied for the top position in providing “substantial disclosure” in their budget transparency. Alongside Negeri Sembilan and Perak, they provided a detailed breakdown of their respective expenditure and revenue in 2022. Only Terengganu publishes its enacted budget, which is passed by its legislative assembly and used the following fiscal year. These states are administered by different coalitions and parties; Terengganu is led by the Islamic Party Parti Islam SeMalaysia, Selangor and Negeri Sembilan are administered by Pakatan Harapan (PH), whereas Perak is under a PH-Barisan Nasional coalition.

Ultimately, what investors appreciate is policy predictability, which is what a more transparent working environment can provide.

Malacca, Johor, Sarawak, Sabah and Penang provided only “minimal disclosure” (Penang and Malacca provided only their budget speeches to the public) of their budgets. In the lowest category, Perlis, Kelantan, Kedah and Pahang were deemed to have provided insufficient disclosure of budget documents. Kedah and Kelantan did not release any form of budget documents to the public.

Apart from budget transparency, IDEAS also studied “oversight”, which tracks the role of the state legislative assemblies in their oversight of budgetary processes. In this aspect, Selangor, Terengganu and Sabah scored the highest. There was timeliness in the tabling and passing of state budgets and in the laying out of audit reports to legislative assemblies, respectively. States that provide state assembly official records (Hansards) and information on Public Account Committees (PACs) are regarded as performing well; at this, only Selangor provides both. Selangor has the highest number of days in which state representatives deliberate the budget, followed by Sarawak and Johor.

Budget transparency may not be significant for states already attracting investment. After all, Penang does not perform very well in the MyOBI index and yet outperformed all other states in investment figures in 2023. But good governance could make a difference for states neighbouring the Klang Valley and Penang. For instance, Negeri Sembilan and Kedah could benefit from spillover proximity effects. While resources like land and infrastructure are still fundamental factors of production, states can signal to investors that they are serious about good governance.

But do investors really look for good governance practices to inform their financial decisions? In a 2015 study, greater fiscal transparency was found to lead to better debt management and improved public financial management. Macroeconomic stability also led to lower investment risk and higher credit ratings. At the state level, an analysis of 10 pilot studies showed that subnational fiscal transparency exposes holes in subnational public financial management and tracks financial flows from the source to points of programme delivery. Transparency assessments help to control subnational borrowing as they measure the ability of subnational governments to pay back what they borrow. This allows for comparisons between states, which in turn encourages inter-state competition.

As more state governments raise their own funding  such as Sarawak Energy’s issuance of a RM3.5 billion sukuk (bond) — it is in states’ interests to improve their subnational transparency rating. Since investors scrutinise states’ allocation of resources, these subnational entities should consider improving their governance scores. If states like Penang and Johor want a greater share of revenues generated within their borders, they should demonstrate responsible stewardship of resources they already control. States also oversee local governments, which are important providers of services for firms.

Malaysia is currently benefitting from global interest in the semiconductor industry; as a result, states are now competing for investments. Ultimately, what investors appreciate is policy predictability, which is what a more transparent working environment can provide. Apart from fiscal transparency, states can also incorporate sustainability and business and human rights (BHR) practices into existing economic development policies and plans. This would send a signal that states are open for business, and are willing to adopt globally accepted practices to do so.

Posted in Economics, Public Administration, Transparency and Good Governance | Leave a comment

Outgoing IDEAS CEO Dr Tricia Yeoh Joins University of Nottingham Malaysia

This press statement was released by the University of Nottingham Malaysia on 13 August 2024, here.

Semenyih, 13 August 2024 – The University of Nottingham Malaysia (UNM) is delighted to announce the appointment of Dr Tricia Yeoh as Associate Professor of Practice at the School of Politics and International Relations, effective 1 October 2024. 

Dr Tricia Yeoh is a renowned policy analyst and researcher, known for her contributions to promoting democracy, economic liberalisation and inclusion, and governance in Malaysia. With a background in public policy and close to two decades of experience in the field, Dr Yeoh has significantly influenced national policy and governance discussions through her leadership at the Institute for Democracy and Economic Affairs (IDEAS). 

Associate Professor of Practice, Dr Tricia Yeoh shared, “I am truly excited about joining the University of Nottingham Malaysia’s School of Politics and International Relations, especially since this is where I conducted my doctoral studies. This opportunity to return is incredibly meaningful, allowing me to give back to the institution that shaped my academic journey.   

With over 20 years of experience working across government, think tanks and the private sectors, Dr Yeoh brings a unique perspective on public policy, politics and international relations. She is eager to share this knowledge and expertise with the next generation of students.  

“As Associate Professor of Practice, I aim to bridge the gap between theory and practice, infusing my teaching and research with examples from my professional experiences. I believe this approach will enrich academic discourse and prepare students to navigate the complex landscape of public policy and politics. I am dedicated to contributing meaningfully to the University, fostering a dynamic and engaging learning environment, and supporting the growth and development of our students. By bringing my experience to this esteemed institution, I hope to inspire and equip our students with the skills and knowledge they need to excel in their future careers,” Dr Yeoh added

Dr Benjamin Barton, Associate Professor and Head of School of Politics and International Relations at UNM shared, “The University of Nottingham Malaysia and the School of Politics and International Relations are thrilled to welcome back Dr Tricia Yeoh, this time in her capacity as a fully-fledged faculty member. Dr Yeoh’s significant experience in policy research and advocacy, network building, fundraising, as well as people and project management within fields such as domestic politics, political systems, civil society, human rights, political economy, development, sustainability, and gender studies aligns perfectly with the School and University’s strategic goals.” 

“Dr Yeoh will also be the first Director for External Engagement (DEE) for the School of Politics and International Relations with her primary responsibility being to establish and manage the School’s External Advisory Board as well as connecting the incredible work we do at the Faculty to help address Malaysia’s most pressing social, political and environment challenges. Dr Yeoh is ideally suited for this role. She is highly respected for her years of service at IDEAS and possesses a broad range of talents”, Dr Barton added.  

In addition to her policy and advocacy work, Dr Yeoh has pursued academic research on Federalism, aligning with UNM’s School of Politics and International Relations research strategy. The University is excited to support Dr Yeoh in becoming a world-recognised expert in this area, confident that students will benefit tremendously from her experience and insights, built on her impressive track record as a PhD holder, part-time lecturer, guest lecturer, public speaker, and consultant. 

Dr Tricia Yeoh holds a PhD in Political Science from the School of Politics and International Relations at the University of Nottingham Malaysia and is currently Visiting Senior Fellow at the ISEAS-Yusof Ishak Institute at the National University of Singapore (NUS). She is qualified in Econometrics and Marketing from Monash University (BBusComm) and holds a MSc. in Research Methods in Psychology from the University of Warwick. She is editor of the books “The Spirit of Merdeka”, “The Road to Reform: Pakatan Rakyat in Selangor” and author of “States of Reform: Governing Selangor and Penang”.  

Dr Yeoh was awarded the Meritorious Service Medal, conferred by His Royal Highness Sultan of Selangor (Pingat Jasa Kebaktian, PJK) in 2011. She has been awarded the 2017 Distinguished Alumni Award for Monash University Malaysia, the Postgraduate Award Prize 2020/21 from the University of Nottingham Malaysia, the Malaysian Australian Alumni Council’s Female Alumnus of the Year 2022 and the 25th Anniversary Alumni Award for Monash University Malaysia. Her documentary, “The Rights of the Dead” won the Justin Louis Award at the FreedomFilmFest 2012 and was screened at the Al-Jazeera International Film Festival in 2013. She speaks and writes regularly on national public policy issues, having been featured in The Economist, and on CNN, Al-Jazeera, Bloomberg, CNBC, amongst other platforms. 

Posted in Academia, International Relations, Politics | Leave a comment

IDEAS Announces CEO Transition: Farewell and Welcome

This press statement was released by IDEAS on 12 August 2024 here.

Kuala Lumpur, 12 August 2024: The Institute for Democracy and Economic Affairs (IDEAS) announces that Dr Tricia Yeoh will be stepping down from her role as CEO at the end of September 2024. She has served IDEAS as Chief Operating Officer, Fellow and then finally CEO, over the last 11 years, and will be transitioning to a new role in academia after her tenure at IDEAS.

Under her leadership, IDEAS significantly expanded its influence and public policy impact by fostering strong relationships with numerous networks and partners, working in the areas of democracy and governance, public finance, economics and business, and social policy. A notable achievement was the establishment of the All-Party Parliamentary Group on Political Financing that IDEAS is Secretariat of, which advocates for essential political financing reforms, and that drafted Malaysia’s first ever version of a Political Financing Bill. Under her watch, IDEAS has achieved remarkable financial sustainability, marking the best performance in its history.

Reflecting on her journey with IDEAS, Dr Tricia said, “The 11 years that I spent in IDEAS have been the most rewarding of my professional life. IDEAS has had a tremendous impact on my career in public policy and political studies. IDEAS has been an amazing platform that provided me an opportunity to expand my knowledge and experience in the fields of public policy research and advocacy, management and team-building. I am also thankful to IDEAS for having sponsored my doctoral studies. For all this, I will always be grateful.”

“IDEAS continues to be the best organisation in Malaysia for anyone who is interested in pursuing independent public policy research and making a difference. The organisation has undergone tremendous change and transformation from its earliest days, all for the better and in keeping with the context of each phase. I believe that leadership change is good for organisational renewal. I extend my heartfelt thanks to the Board, our funders, and partners who have made my time as CEO at IDEAS over the last four years the outstanding experience it has been. I would like to personally thank my team members who have worked alongside me so tirelessly – I could not have achieved such success at IDEAS if not for them. It has truly been an honour for me to lead this incredible team,” added Dr Tricia.

The Board of Directors is pleased to announce that beginning 16 September, Aira Azhari, current Senior Manager of Advocacy and Events will be succeeding Tricia as the Acting CEO of IDEAS. Aira has been with IDEAS for almost nine years, starting as a Research Executive in 2016 after finishing her Master of Laws from the London School of Economics and Political Science. Aira has contributed immensely to IDEAS’ growth over the years, particularly in her work championing institutional reforms, and more recently, leading and transforming IDEAS’ advocacy and events team, boosting IDEAS’ profile and credibility with important stakeholders. Aira has also been a frequent and trusted analyst of politics and current affairs, having represented IDEAS in both local and international media. 

Aira shared her enthusiasm about the new role, stating, “It is an incredible honour and privilege to be entrusted with leading an organisation as important as IDEAS. The crucial role IDEAS plays in building a Malaysia that upholds liberty and justice for all is a responsibility I take very seriously, and I look forward to working with my excellent colleagues in advancing public policy discourse in this country. I am also grateful to the Board for their trust and support throughout this transition process and beyond. To Tricia, I am thankful for the exemplary leadership she has shown us all, and I wish her all the very best in her future journey.”

YAM Tunku Zain Al-‘Abidin ibni Tuanku Muhriz, Founding President of IDEAS and Chairman of the Board, commented, “The Board thanks Tricia for her exceptional leadership and dedication which has propelled IDEAS forward in numerous ways.  I have enjoyed working with her over the past decade and I know she will excel in her next role.  We are excited to welcome Aira, who we believe will build upon Tricia’s legacy and lead IDEAS to new heights.”

IDEAS remains steadfast in its commitment to improving public policy and building a better Malaysia for all. We thank Dr Tricia Yeoh for her outstanding contributions and wish her success in her future academic endeavours.

Posted in Civil Society, Liberalism, Transparency and Good Governance | Leave a comment

The Business of Governing Penang: Workarounds as Remedy?

This is a journal article co-authored by Xinying Chan, Meredith Weiss and myself, published in the Journal of Current Southeast Asian Studies. It can be accessed here.

Citation: Chan, X. Y., Weiss, M. L., & Yeoh, T. (2024). The Business of Governing Penang: Workarounds as Remedy? Journal of Current Southeast Asian Affairs, 43(2), 331-354. https://doi.org/10.1177/18681034241262041

Abstract

The state of Penang, including city councils for island Pulau Pinang (with urban-core George Town) and mainland Seberang Perai, has negotiated at least a degree of political marginalisation since independence. Ruled previously by a secondary partner in the ruling Barisan Nasional (National Front), and since 2008, by the Democratic Action Party and its coalition partners, the economically powerful state has negotiated constrained autonomy and resources. While to some extent, these governing challenges are common to all states in Malaysia’s highly centralised federation, in other ways, they reflect Penang’s specific political position. Penang’s leadership has sought in particular ways to circumvent inertia or divided loyalties among bureaucrats from the federal, rather than a state-level, civil service. Central to that solution has been reliance on an array of state government-linked corporations, facilitating administration, but at possible cost to clear accountability, transparency, and promised empowerment of civil society.

Posted in Academia, Federalism, General Politics, Public Administration | Leave a comment

Why are Asian thinktankers pessimistic about the future?

This op-ed was first published on the On Think Tanks website here, on 17 October 2023.

In the Think tank state of the sector report 2023, Asian thinktankers were pessimistic about the future. Political challenges appeared to be driving this pessimism, with reports that they are experiencing worsening conditions in their countries.

They expressed their growing concern about rising authoritarianism – with governments suppressing civil society and the media – and about the lack of cooperation between think tanks and governments.

Asian thinktankers also cited attempts to curtail opposition and critical voices, and the challenges arising from governments’ use of policy to restrict civil society and think tanks. Some examples given included threats and attacks against their work: fact-checking activities, attempts to discourage engagement and labelling them as spies.

The presence of such a hostile political climate is leading to challenges in engagement, collaboration and advocacy.

These are worrying trends for think tanks, donors and supporters of freedom.

In this article, I dive deeper into why Asian thinktankers might be so pessimistic, and how we might respond as a sector to these challenges.

Geopolitical context

Thinktankers in this region reported that the political environment in most of their countries is marked by increased polarisation and political instability, the latter of which has been contributed to, in part, by the Russian invasion of Ukraine.

While for many Asian countries the Russia–Ukraine war may be geographically distant, the economic impacts are evident: food prices in most countries in this region have increased since the start of the war, with governments implementing protectionist approaches to protect their food security as a result.

In South-East Asia, China’s presence contributes to geopolitical uncertainty, especially following its recently released “standard map”, which claims a significant area of the disputed South China Sea. These developments may have contributed to the general sentiment around the region’s perceived instability, which has indirectly impacted think tanks within their respective countries.

Authoritarianism across Asia

We’re currently seeing growing authoritarianism across the region.

Malaysia has undergone a recent rise in conservative politics, with parties using the rhetoric of race and religion to attract Malay-Muslim majority voters, putting pressure on the government.

In Indonesia, the state is exercising greater control over the internet, where private operators need to register with the government in order to operate, and the president is accused of abuses of power as he claims to spy on political parties.

In India, the rule of law is under question as due court process is not adhered to in one state’s crackdown on crime. And in Sri Lanka, even amidst their worst economic crisis, several bills are being floated that may threaten human rights including an anti-terrorism bill that has provisions to stop civil society activities.

Funding and government control

Given this heightened political environment, thinktankers, especially those within South-East Asia, reported pessimism about their funding context, with only 11% predicting an improvement – a significant change from last year, when only 18% expected a worsening.

The key factor driving this negative assessment is increased government control and political factors, political instability, government pressure on (or rejections of) donors, distrust of civil society organisations and economic issues that negatively affect funding.

An example of this government control can be seen in India, where think tanks and other non-profit organisations are required to be registered under the Foreign Contribution (Regulation) Act (FCRA) in order to receive foreign funds, the licenses for which can be cancelled by the government.

In many Asian countries, receiving foreign funds is perceived as being influenced by a foreign – often Western – agenda; therefore, governments have often threatened to regulate this tightly.

Also, there are laws in many Asian countries – including NepalPakistanBangladeshVietnam and China – that require non-profit organisations to register themselves under highly bureaucratic processes. Such scrutiny, of course, restricts think tanks’ ability to be independent in their research and advocacy work.

Staff retention

At the global level, the report indicated that human resources was a key competency for think tanks. This was mostly driven by Asian thinktankers, who mentioned that investing in recruitment, the capacity building of their staff and staff retention was critical.

In a region where talent is highly mobile, it is indeed challenging to retain staff as they often depart for better opportunities in other sectors or even other countries.

To a lesser degree, respondents also cited adaptation to evolving contexts, regulatory challenges, fostering strategic collaborations and strengthening research programmes as important for think tanks.

As multiple countries in Asia face national elections in 2024, think tanks must come together to strategise

Despite the multiple challenges, thinktankers in Asia mostly reported that there has been no change in the difficulties of running a think tank. This finding might be counter-intuitive to the political context being faced within each country.

One possible explanation is that the political environments in Asian countries have always been tough to operate in; in many cases, perhaps this was the reason why the think tanks were set up in the first place.

Nonetheless, if governments are more likely to suppress think tanks than they are to receive their recommendations, how can our public policy research really have meaningful impact?

Given that thinktankers are expecting even more authoritarian trends from the governments across Asia, it’s now even more important for think tanks to engage in learning conversations with each other.

Bringing think tanks together would provide solidarity, achieve greater understanding of the region’s context and, most importantly, strategise towards solutions for how to operate more effectively.

The worrying fact that thinktankers in Asia are increasingly pessimistic is also an opportunity to promote collaboration and engagement among us.

Existing think tank and civil society networks in Asia should connect more frequently with each other, such as the Asia Democracy Network and Southeast Asia Think Tank Network. This would enable networking platforms for think tank leaders to actively engage with each other in the near future, which would be helpful in a restricted-funding environment.

As several Asian countries face national elections in 2024, including Bangladesh, India, Indonesia, Pakistan and Taiwan, political conditions there are bound to intensify. Hopefully, think tanks in these countries and in the Asian region, more broadly, will be able to face the challenges of the future through much-needed strategic planning and partner engagements.

Posted in Civil Society, Elections, Ethno-Religious Politics, General Politics | Leave a comment

Will Anwar’s political dilemma in Malaysia stall reforms?

This article first appeared on the East Asia Forum website here, on 20 September 2023.

The conclusion of six state elections held in August 2023 provided a much-needed pause in Malaysian politics. Held nine months after the 15th general election (GE15) in November 2022, these elections were a mid-term gauge of the popularity of Prime Minister Anwar Ibrahim’s coalition government, which is comprised of former rivals Pakatan Harapan (PH) and Barisan Nasional (BN).

Protesters holding Malaysia flags and placards attending the ‘Save Malaysia’ rally in Kuala Lumpur, Malaysia, 16 September 2023 (Photo: Reuters/EyePress Newswire/FL Wong).

The PH coalition maintained its hold on three states — Selangor, Penang and Negeri Sembilan. The national opposition, Perikatan Nasional (PN) and its component Malaysian Islamic Party (PAS) achieved supermajorities in its three states — Kedah, Kelantan and Terengganu.

While retaining control of its states gave Anwar a political reprieve, PN made significant inroads into all three west coast states. The coalition was denied a two-thirds majority in Selangor, where PN increased its number of seats from one to 22. Similar seat increases took place in Penang and Negeri Sembilan. The PH coalition also managed to retain two seats in the recent Johor by-elections.

While PAS’ strongholds remain the predominantly Malay states in the north and east coast of Peninsular Malaysia, support for PN grew even in semi-urban parts of Selangor, located around the periphery of Klang Valley’s urbanised centre.

Several reasons account for this ‘green wave’, including the rise of Malay nationalism, which PN leaders leaned into during both the GE15 and recent state elections. But the decline of the United Malays National Organisation, the lynchpin of BN, was plagued by fragmentation and corruption allegations, which may have also played a role in PN’s success.

With an ethnically and religiously majoritarian opposition gaining Malay support, the PH coalition has chosen a more conservative route to shore up Malay support. In the lead-up to the state elections, the federal government ordered a ban on Swatch LGBT pride-branded watches and cancelled a music festival after a band’s lead singer gave a pro-LGBT speech and kissed his male guitarist on stage.

The federal government has also increased the budget and roles of JAKIM, the federal agency that oversees Islamic affairs. Anwar’s government is also moving to restrict the use of the word ‘Allah’ by non-Muslims in Peninsular Malaysia, and aims to table controversial legislative amendments to elevate the role of Islamic Syariah law in the criminal justice system.

Anwar’s moves to strengthen his position among the Muslim majority sets up a potentially a slippery slope towards PN continuing to set the political agenda and tone, which PH–BN is then forced to respond to.

A more significant threat to the reform agenda might emerge if, to placate and win over Malay support, the government delays much-needed economic and institutional reforms. While the government has approved the long-awaited Freedom of Information Act and Government Procurement Act, concrete steps must be taken to see them enacted in Parliament to avoid potential resistance.

The mid-term review of the 12th Malaysia Plan proposes introducing targeted subsidies for electricity, diesel, petrol and social assistance. Fiscal consolidation is urgent given the country’s fiscal squeeze and high public spending in recent years. If it can see this through, this would be a major success, since subsidy rationalisation might impair Anwar’s popularity amongst low-income households struggling to cope with increased costs of living. .

Implementing the Government Procurement Act is crucial for enhancing transparency and competitiveness in public procurement. But the timeline and drafts of the law have not yet been viewed by external stakeholders and it might be seen as an affront to existing procurement practices, which have been a source of race-based patronage in the past.

It is unclear if Anwar’s government will have the confidence to reform the large swathe of government-linked companies (GLCs) in Malaysia. Many of these were set up to empower the Bumiputera (Malay and other indigenous) communities but have become victims of patronage. GLCs that are uncompetitive and underperforming pose a financial strain on the public sector.

A comprehensive financial and performance review of all GLCs, especially those that are not publicly listed and hence not strictly scrutinised by regulators such as Bursa Malaysia and the Securities Commission, is necessary to determine which ones should continue to exist. The culture of political appointments to the boards of GLCs, which Anwar’s administration has continued, will need to end.

The government has launched ambitious economic plans, including the Madani economy framework, National Energy Transition Roadmap, New Industrial Master Plan and the mid-term review of the 12th Malaysia Plan. Political reform will also be needed to minimise corruption.

To see these strategies through, structural reform efforts are necessary. But if these reforms are seen as eating into the economic share of Malays, Anwar’s administration will face resistance. The better approach would be to demonstrate that these reforms will expand economic opportunities for all and provide a time-bound financial cushion to those hardest hit. The upcoming 2024 Budget Speech, where some of the government’s economic agenda will be announced, is an opportune time to do so.

PH’s reform position is becoming difficult to maintain, particularly after appointing UMNO’s scandal-ridden President Zahid Hamidi as Deputy Prime Minister. The recent action by the public prosecutor to discharge him from all corruption charges is surprising. In Malaysia, the Offices of the Public Prosecutor and Attorney General are held by the same person. If the government does not heed the decades-long call from civil society to separate the two offices to avoid political interference in legal matters, PH will struggle to reclaim its moral high ground. The Minister of Law and Institutional Reform has recently announced plans in this regard, but it needs to be expedited even more urgently given the circumstances.

In playing to the gallery, the current government risks portraying itself as lacking the impetus to reform, which could narrow Anwar’s options. Malaysia must reignite its reform agenda quickly, while communicating the economic benefits to the Malays. But this will prove challenging, especially with an increasingly strong opposition that has used racially divisive language to elevate Malay insecurity.

Dr Tricia Yeoh is CEO of the Institute for Democracy and Economic Affairs (IDEAS), Malaysia, and Campus Visitor at the Australian National University.

Posted in Corruption, Elections, Ethno-Religious Politics, General Politics, Public Administration, Transparency and Good Governance | Leave a comment

Balancing growth and fiscal management

This article, which reviews the Mid-Term Review of the 12th Malaysia Plan (12MP MTR), first appeared in the StarBiz7 feature on the 12MP MTR on Saturday, 16 September 2023.

THE Madani economy framework and the 12th Malaysia Plan mid-term review (MTR) do not seem to have a significant difference on the surface, but the latter contains some initiatives which will be game-changers if implemented well. These include the move towards a progressive wage policy and also initiatives in the healthcare sector, including setting up a new mental health institution, a national ageing action plan and a geriatric centre.

More than that, under the MTR, the government plans to optimise the use of data for public policy. An Omnibus Act will govern data-sharing and cloud storage, while an impact study on the Public Sector Data Sharing Policy and National Data Sharing Policy will be done to encourage data-sharing. A new integrated household database (PADU) – a socioeconomic data repository on households – will also be set up.

Appointing a chief digital officer to spearhead digital technology, data governance and digital literacy will be something that all industries, especially those reliant on research and data, will look forward to. A National Digital Identity pilot project will be rolled out in 2025, while the government will transition

to the digitalisation of services under a new government technology programme.

Second, the MTR is forthright about implementing public sector reforms. For instance, it plans to introduce a Public Sector Governance Act and integrity plan as a guide on “corruption-

free governance for all entities, both public and private”, in its goal to aim for the top 25 positions in the

global Corruption Perception Index (CPI) within 10 years.

On this note, it is also positive that beneficial ownership declarations will be reviewed to strengthen transparency of share ownership, specifically within the Companies Act 2016 and Limited Liability Partnerships Act 2012.

A governance and institutional framework and legislation “related to corruption” were also announced, as

well as a special task force on agency reform (STAR). The structure and functions of ministries and agencies are to be reviewed and streamlined. Public sector efficiency is certainly welcome, since civil service performance is essential for the effective delivery of public goods and services.

A third observation is regarding the government’s plans to balance growth with fiscal management. The

12MP is allocating an additional RM15bil, increasing spending to RM415bil. According to the government, increased spending is possible due to savings from subsidy re-targeting various

national expenses as well as reallocating unused GLC and statutory body funds, all of which will be transferred to development expenditure.

While this may be positive at the outset, the additional RM15bil is of some concern. Historically, the government has not had the capacity to fully use the allocated expenditure. Budget documents suggest that the government only managed to spend around 91% of the estimated development expenditure from 2011-2021, except in 2018 where the expenditure was more than the estimate.

Given these aims, the government will have no choice but to engage in long-awaited fiscal consolidation. It has already announced targeted subsidies will be rolled out as soon as early next year for electricity, diesel, petrol as well as other social assistance. PADU will reportedly provide “near real-time micro data on individualssuch as demography, income and social assistance”. This is a bold move, since removing subsidies will result in higher costs of living for some income groups. Some PH MPs have called to

assess these plans as it would have economic impact on small-scale industry players and the M40 community.

But subsidy rationalisation, which has been discussed over the last decade with minimal progress, is key to

ensuring that over the long term, the government can achieve its 3.5% deficit target. This is especially the case given substantial public spending over the last few years during and after the Covid-19 pandemic.

The government’s priority on fiscal responsibility raises the possibility of restoring Goods and Services Tax (GST) as well as implementing Capital Gains Tax (CGT) that was previously announced, both of which would provide more secure buffers for the government’s public spending on a more sustainable, long-term basis.

The Fiscal Responsibility Act and Government Procurement Act (GPA) are two legislative reforms that this government should also enact immediately, to complement efforts on responsible public financial management. The government’s announcement that the GPA has been approved is therefore welcome, but clear timelines on its enactment must now be presented to the public. On this note, plans to enhance the Public Expenditure Review and reactive the Debt Management Committee are also positive.

Finally, a bumiputra economic congress is to be held in January 2024 with the objective of setting a new

direction and approach that is “more fair, equitable and inclusive”. Building bumiputra businesses to increase income levels is positive, but caution might be exercised when aiming to improve effectiveness of aid and support to bumiputra involvement in economic activities.

Encouraging enterprise development is best done by removing barriers to business, most often regulatory

or legal in nature. In the rollout of future economic plans, it is hoped that greater focus on promoting healthy, robust competition among enterprises can be achieved.

An example is updating the Competition Act 2010 to enhance competition in all sectors as well as

conducting a thorough review of the large number of state-owned enterprises and government-linked companies in Malaysia – especially those that are not financially viable. A more competitive environment

that is not encumbered with excessive regulation is what will ensure private sector growth, increased foreign investment and participation towards a thriving economy.

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Anwar Ibrahim’s first 100 days in office

Analysis by Tricia Yeoh, PhD

This article was first published on Friedrich Naumann Foundation for Freedom’s website here on 13 February 2023. It was also translated and published in German, available here. Quite pleased to have an article auf Deutsch. More to come, we hope.

Germany’s President Frank-Walter Steinmeier visits Malaysia. He will meet Anwar Ibrahim, the new Prime Minister. Mr. Anwar leads a broad coalition, which includes previous arch-rivals. He spent 25 years in opposition, ten of them in jail due to politically motivated convictions. As Prime Minister, Mr. Anwar has to strike a delicate balance to secure his and his government’s positions. Tricia Yeoh, CEO of Malaysia’s Institute for Democracy and Economic Affairs, analyses Anwar Ibrahim’s first 100 days in office.

Malaysia´s new “unity government” – Pakatan Harapan (PN, or The Pact of Hope) and Barisan Nasional (BN, The National Front) plus two regional coalitions – came about after no single political coalition won a simple majority. Amongst the first endeavours was to ensure stability, which had been tumultuous given three government administration changes in as many years.

Anwar Ibrahim, the new prime minister, chose to appoint Zahid Hamidi as his deputy, a controversial figure given that he is embroiled in a slate of corruption cases. The appointment was surprising as Anwar and his party, Parti Keadilan Rakyat (PKR, the National Justice Party) campaigned on good governance and reform. Nevertheless, it was a politically expedient move. Zahid as President of the United Malays National Organisation (UMNO, the main party of Barisan Nasional) contributed 30 parliamentary seats to the coalition, without which the new federal government could not even have been formed.

The new Cabinet also featured several other BN figures who had in fact lost their seats in the parliamentary election, including Tengku Zafrul Aziz as Minister of International Trade and Industry and Zambry Abdul Kadir as Minister of Foreign Affairs, both of whom were appointed as Senators. These appointments were considerable compromises that needed to be made by Anwar in order to seal a harmonious deal, especially between PH and BN. In December, a unity government agreement was reached and signed by all coalition members. Shortly after, Anwar successfully won a motion of confidence in Parliament. Securing a majority was crucial for a country beleaguered by political instability; only then would the government have the confidence to move forward.

While the coalition agreement was received well in order to restore political stability, parts of it came under heavy criticism from civil society, in particular a clause in which Members of Parliament from coalition parties are deemed to have resigned their positions should they vote as they wish on any procedural matter in Parliament. This prevents backbenchers, for example, from voting conscionably against government policies they disagree with – a matter of principle where they ought to be able to exercise their individual judgment on policy and legal matters, especially on the occasion they take positions that differ from their political parties.

Good governance and economic agenda – present but shaky?

Expectations on Anwar Ibrahim’s premiership are high. He has been able to win some public confidence based on his initial speeches. For example, in one of his first engagements with his staff, he announced that the government under his leadership would not allow leakages and corruption, specifically that there could no longer be procurement approvals without tenders. He also announced that political appointments to government-linked companies (GLC) would be terminated, but later explained that some MPs might be appointed based on set guidelines on professional capabilities, past performance and compliance with regulatory and governance practices. As such, the initial appointment of an UMNO politician as Chair of a plantations GLC was postponed.

Anwar publicly revealed a slogan termed ‘Malaysia Madani’ in January 2023, a concept to drive and restore Malaysia’s dignity and glory in the global arena. The concept is based on six pillars: sustainability, prosperity, innovation, respect, trust and compassion. Clumsily translated into a Malay-based acronym, which caught some public ridicule, the concept is nevertheless welcome. Anwar called on the unity government’s leadership to practice trust, good values and morals as well as fair and effective governance. Alongside an economic plan based on three strategies to eradicate poverty, restructure and restore the economy, and generate the economy based on the Madani principles. Thus far these general thrusts seem to resonate well.

Third, Anwar made the decision to slash constituency development funds for Members of Parliament by almost 75% on the basis of economic constraints. While it is positive that the government recognises the fragile fiscal situation it is in, this may severely impact parliamentarians’ ability to serve their constituencies. Nevertheless, this may provide the very impetus needed for MPs to advocate for systemic change – they ought not be welfare providers over a long-term period, which is the role of government agencies.

In addition, the government must seriously consider other economic solutions to improve the country’s fiscal balance including by widening its revenue base through new forms of taxation. Most recently, the World Bank’s lead economist in Malaysia emphasised that Malaysia under-collects in personal and consumption taxes and agreed that broadening the tax base was essential to increasing government revenue collection.

While some moves have been positive, one faux pas that marks Anwar’s first 100 days in office is his decision to appoint his eldest daughter, Nurul Izzah, as his senior advisor on economics and finance. Losing her parliamentary seat for the first time since 2008, many saw Nurul Izzah´s appointment as bordering on nepotism with a serious conflict of interest. While qualified for the job, and not drawing a salary for this position, she would have been in a strategic position at the Ministry of Finance to potentially advise on decisions over major contracts, appointments and economic policies. Anwar is also Finance Minister in addition to his Prime Ministerial portfolio, which is also not good practice. The move may have been deemed necessary by Anwar, who needs trusted allies close by his side while navigating a precarious political environment. Nurul Izzah has since resigned her position, and instead will co-chair a secretariat formed by an advisory panel for the ministry. With a clearer and more structured mandate, this reflects better on Anwar’s administration although the misstep could have been avoided altogether from the start.

What Lies Ahead for Anwar and his government

The next few months are crucial for Anwar Ibrahim’s government. First, he will face his first full Parliamentary sitting from 13 February onwards, during which he will need to table a new Budget 2023 and obtain a majority vote to pass the government’s first major policy document.

Second, a lot of attention will be given to how Parliament itself will be handled – the new Speaker of the Lower House is a political stalwart from his very party, PKR – and whether or not unbiased treatment will be provided to all MPs alike. But reform is in demand – and he has already introduced new changes, such as a Prime Minister’s Question and Answer (PMQ) session and Minister’s Question Time (MQT) every Tuesday and Thursday respectively. Apart from the anticipated re-enactment of the Parliamentary Services Act, new Parliamentary Select Committees will also be announced in the upcoming sitting. This will indicate the government’s policy priorities on topics ranging from climate change to governance to institutional reforms.

Third, all eyes will be on the upcoming UMNO party election, which must be held by May. On this note, a recent decision was made to ban contests for the positions of UMNO President and Deputy President. This, alongside separate decisions to sack an aspiring UMNO politician, Khairy Jamaluddin, and to suspend several other MPs deemed as threats for six years, indicate a growing unease within the party. Khairy had publicly pronounced his intention to run for UMNO President and to reform the party. While Anwar’s position seems secure for now, the ‘UMNO purge’ may not resonate well with UMNO grassroots. This may impact the UMNO party election. Given the coalition’s makeup, the future of UMNO has a direct bearing on the future of the government’s stability.

Ultimately, while government policies are being highly scrutinised given high expectations of reform, the future lies in Anwar’s ability to manage varying interests, ideologies and expectations from amongst his coalition partners. Most recently, the unity government formed three new committees on communication strategies, state elections and monitoring of political developments and administration, a sign that the coalition partners are coalescing – for now. The opposition, the PN coalition, however, is equally hard at work. It recently announced the country’s first federal Shadow Cabinet. Another challenge in the long-run: managing the country’s increasing ethno-religious polarisation, especially ahead of six upcoming state elections. These are exciting times for Malaysia as the country goes through political renewal amidst rapidly changing global socioeconomic and geopolitical environments.

*Tricia Yeoh (PhD) is CEO of IDEAS (Institute for Democracy and Economic Affairs), an independent public policy think tank in Malaysia.

Posted in Elections, General Politics, Transparency and Good Governance | Leave a comment

Crisis Averted for now: Malaysia’s 15th General Election and What Lies Ahead

Tricia Yeoh

This piece was originally published by the Heinrich Böll Stiftung Southeast Asia website here, on Monday 28 November 2022.

Malaysia’s highly anticipated 15th General Election (GE15) on 19 November 2022, originally intended as a way to end the prolonged political instability over the last two and a half years, had resulted in everything but that for the initial few days.  

With no single coalition winning an outright simple majority, the different coalitions – Pakatan Harapan (PH), Perikatan Nasional (PN) and Barisan Nasional (BN), as well as their counterparts from East Malaysia, Gabungan Parti Sarawak (GPS) and Gabungan Rakyat Sabah (GRS) –engaged in a merry-go-round of negotiations to achieve the necessary collective number of parliamentary seats to form a majority government. There was no clear resolution – until the King stepped in issuing a call for a unity government.

The PH, BN and GPS coalitions ultimately came together to form a federal government, and on Thursday 24 November, Malaysia’s 10th Prime Minister was appointed and sworn in: Dato’ Seri Anwar Ibrahim.

The Brewing Storm of PN vs BN

At the time of Parliament dissolution, the incumbent federal government was a strangely-shaped coalition comprising both PN and BN, led by a BN Prime Minister. The parties comprising PN, Parti Pribumi Bersatu Malaysia (Bersatu) and the Malaysian Islamic Party (PAS), as well as those within BN, the United Malays’ National Organisation (UMNO) and its smaller component parties, had come together in March 2020, replacing the previously elected PH coalition in a series of events now referred to as the “Sheraton Move”.

The PN-BN federal government’s tenure was riddled with uncertainties of its own, cracks between the two showing as early as July 2021, when UMNO announced it was withdrawing support for PN and called for Muhyiddin Yassin to step down as Prime Minister. Muhyiddin was eventually replaced by UMNO veteran Ismail Sabri the following month. Over the subsequent year, the Bersatu-UMNO rifts continued to grow while pressure was increasingly mounted on Ismail to dissolve Parliament and hold an election.

Prime Minister Ismail eventually caved in and dissolved Parliament on 10 October 2022. Looking back, the intense demands from within UMNO to call for an election at this time of year – typically avoided due to the monsoon season and the risk of flooding across the country – was based on multiple factors.

First, UMNO had been emboldened by their stellar performance in the recent state elections within Melaka and Johor, in which they won strong majorities (21 out of 28 in Melaka and 40 out of 56 in Johor). This contributed to the perception they would perform equally well should the GE be called within the immediate future. Second, given their expectations of winning, they believed this would “restore the mandate” and they could govern with a stable majority, even defeating PN at that. Third, this went unsaid but UMNO’s President Zahid Hamidi was still embroiled in his own corruption trials. Winning a GE would have allowed him negotiating rights over his case, he may have imagined.

A Subdued Campaign – but wait, TikTok     

Malaysia therefore faced GE15 with an extremely messy political backdrop, with an unprecedented number of candidates and many seats with multi-cornered fights (as many as 10 in some cases). The campaign period of 14 days was considerably muted relative to previous elections, where one commonly heard trope was that BN could not spend as lavishly as before.

Used to extravagant spending on ground machinery, door-to-door visits, flush with abundant campaign materials, BN in 2022 had less to spend after not being the main player in federal government for an extended period of time – although Ismail was Prime Minister, the largest share of Cabinet positions belonged to PN.

For all intents and purposes, PN assumed the position of incumbency. This was also felt in the lead-up to election day itself. Invoke’s national polling data indicated that PN was the coalition that gained the most ground over the months leading up to GE15, increasing its Malay support by almost 12% between September and post-nomination in November 2022 (Invoke, Forecasting GE15: voter trends and likely outcomes, November 2022).

And indeed, PN’s social media spending seems to have far exceeded that of either the other two leading coalitions. For example, in the final week of campaigning, it targeted TikTok with sophisticated videos accompanied with enticing music featuring young, attractive Malaysian Malays (read: sponsored social media influencers). On hindsight, enlisting TikTok was an extremely effective strategy. Electoral reforms in Malaysia in 2021 that saw the voting age lowered from 21 to 18, as well as automatic voter registration taking place, resulted in 6.23 million new voters being included in the electoral roll. Campaign tactics having somewhat shifted away from the stage and rallies (remote working over the pandemic years contributed too), young voters depended on social media for their political education.

The Long-Awaited GE15 Outcome

Fast-forward to election night – a sleepless one, for most Malaysians following the news – and as expected by most analysts: a hung Parliament. PH was the coalition with the largest number of seats at 82, followed by PN at 73, and BN performed at its worst ever securing only 30 seats. While it was largely expected that no single coalition would cross the magic line of 112 (as a result of one seat yet to be concluded, the majority needed is now 111), it was the rise of PN – chiefly its component party PAS – that took most by surprise.

In a north-easterly wave of sorts (crescent-shaped, uncannily enough), PN swept almost all seats in Perlis, Kedah, Kelantan and Terengganu. Even strongholds held by incumbents Dr Mahathir Mohamed (former Prime Minister) and Nurul Izzah Anwar (Anwar Ibrahim’s daughter, contesting on the mainland of Penang, a northern state) fell to PN. Of this, PAS won 49, close to 70%, of its coalition’s 73 seats.

While many have signaled their concerns over the rise of Islamic conservatism, Malay voters may have swung to PN for a wide possible array of factors: One, dissatisfaction with BN’s leadership splits and internal rivalries, as well as its poor leadership in the form of court-embattled Zahid Hamidi; Two, the perception of PN being a cleaner alternative against a corrupt BN and the turn therefore to a more trustworthy, religious coalition; Three, that they really had been more inclined towards a more stridently Malay-Muslim coalition – but the latter is unlikely to have been the only, or main, reason for the switch.

In the days immediately following GE15, as coalitions tussled over government formation (ultimately, about getting sufficient numbers), TikTok was filled with videos reminding Malaysians about its dark day in history: 13 May 1969, during which ethnic riots split Malays and Chinese communities. While these videos were eventually removed thanks to enforcement agencies, this added to an already tense moment as no government had yet been announced.

Initially looking like a PN-BN-GPS-GRS ensemble, the tide eventually shifted to PH having the advantage. Several incidents played an instrumental role in this. First, due to the anti-party hopping law passed in 2021, coupled with internal party declarations, all 30 UMNO MPs were obliged to move en bloc according to their leader’s decision. Second, the King met with leaders of PN and PH respectively (Muhyiddin Yassin and Anwar Ibrahim), requesting for a unity government to be formed between them. Rejected by the former, and accepted by the latter, there were allegations of PN being derhaka (treasonous). Third, BN and PH successfully inked a deal to form the Perak state government (only one of the three states holding their election simultaneously with the federal Parliament). And fourth, GPS stating they would leave the decision to the King (reversing its earlier endorsement of Muhyiddin).

Finally, despite BN vacillating between various opposing decisions, it finally issued a statement backing a “non-PN” unity government. On Thursday (five days after polling day), the King announced the appointment of Anwar Ibrahim as Prime Minister. The specific coalitions and exact numbers of Parliamentarians were not named; under the Federal Constitution, the King can appoint as Prime Minister a Parliamentarian who “in his judgment is likely to command the confidence of the majority of … that House” (Federal Constitution of Malaysia). No other conditions are stated, including the process through which the King is to come to his decision. 

Implications and What Lies Ahead

With the combined forces of PH (82), BN (30), GPS (23), GRS (6) and others (7), Prime Minister Anwar Ibrahim will govern with 148 seats, more than a two-thirds majority of the 221 seats in total. If this arrangement can indeed last the full five-year term, this will allow him to make the serious institutional reforms the country so desperately needs, which includes legislative and policy changes. Constitutional amendments require a two-third majority in Malaysia.

Among the first things needed are to ensure a built-in mechanism into the ‘coalition of coalitions’ arrangement, to bind all supporting coalitions together for a permanent period of time. This could be done by way of a Memorandum of Understanding (MOU), akin to what was previously signed by former Prime Minister Ismail Sabri and the then Opposition parties. Ideally, this should also include policy commitments and concessions given to parties, transparently spelled out and made publicly available.

Second, the Prime Minister will need to announce a Cabinet lineup within the next week that adequately represents the multiethnic and multireligious makeup of the country; but more realistically, being inclusive really means having to accommodate the various parties and coalitions making up what is being bandied about as a “unity government”. He has already since publicly committed to a leaner Cabinet, and to reducing its members’ salaries.

Finding a sweet spot between ideological splits between member parties and coalitions, however, will be a challenge moving forward – especially in the area of fiscal consolidation, greatly needed in a country that is facing upward pressures on its public debt to GDP ratio. On that note, the first major policy document – Budget 2023 – will have to be quickly worked on, as the previous government had only tabled, but not yet debated nor passed, it in Parliament. At the minimum, a provisional financial Bill needs to be passed to ensure civil servants’ salaries are paid out come January. A vote of confidence in Anwar as Prime Minister is also scheduled on the first day of Parliament on 19 December.

A Series of Elections in 2023

Looking ahead, election season is not quite over. The Padang Serai by-election takes place on 7 December soon, which will be Anwar’s first test. UMNO’s general assembly also in December, as well as its party election in early 2023 may also pose risks to the coalition’s stability if its President Zahid Hamidi – the chief negotiator with PH who supported cooperation – is removed from his position. Resolutions can be passed at the general assembly, and if the division chiefs are upset, they could pass one to force UMNO’s withdrawal of support.

Next, six state elections are due by between July and August 2023, three of which are currently ruled by PH (Selangor, Penang and Negeri Sembilan) and three others by PN (Kelantan, Terengganu and Kedah).

Results will depend on whether BN can consolidate itself and gain grassroots buy-in for their current co-operation with PH, since working with PH is unprecedented, coming after decades of demonizing particularly DAP as a pro-Chinese party. The new coalition could retain PH states but also gain ground in PN states, especially if cracks start to emerge within Bersatu unused to being in federal opposition. Alternately, PN may consolidate, using its existing north-eastern belt to its advantage and in fact increase its seat share in the PH mid-Peninsular belt by accusing BN-PH of having deceived voters after the GE15 outcome (campaigning against the corrupt BN that lost badly yet emerged winners to be a part of the government).

In short, there is a mountain of work ahead for all sides. There is only a sober sense of anticipation, at most relief, at the GE15 resolution. A constitutional crisis and political impasse was indeed averted, but the last few years of political instability and friction have taught Malaysians to temper their expectations.

The last week has seen a very strange but welcome phenomenon of public apologies from several parties, for any comments made in the past: from DAP to GPS in particular. It is time to heal the nation. Representing parties from varied ideologies and backgrounds, it will be fascinating to see how PH and BN will rise to the occasion to do just that.

Whatever the outcome, the results of GE15 point to one clear sign: PAS has strengthened. Previously with a base in the East Coast of the Peninsular, they now have a stronghold in the north and will work on increasing its influence southwards. For those believing in a more inclusive country, it is time to build back middle Malaysia. It is when the centre is weak that the fringes become more dominant, and the converse is true.

There are many challenges yet for Anwar. The previous PH administration must reflect on its failings during its 22-month stint in power, including various ministers who were unsuccessful in working alongside their public service administrators. It must also avoid the perception of being DAP (and hence Chinese)-dominant, and assure Malays their constitutional special position is not under threat.

If GE14 was about one issue – 1MDB and the fall of Najib Razak – GE15 has been a mixed bag of interconnected themes. Weak leadership, race, religion and a post-pandemic struggling economy, coupled by compromise and cooperation as begrudging solutions. Ultimately, there are no clear winners this time. A sizeable proportion of the population would have been dissatisfied no matter the outcome, having seen votes split multiple ways.

Nevertheless, with a 73.9% voter turnout, Malaysians still seem to believe in exercising their democratic right to choose their leaders every four to five years. And that is a good thing, as Malaysia continues its process towards democratic consolidation and learns to negotiate, hopefully along policy instead of patronage-based lines.

Tricia Yeoh is CEO of IDEAS (Institute for Democracy and Economic Affairs), an independent public policy think tank in Malaysia. She holds a PhD from the School of Politics, History and International Relations at the University of Nottingham Malaysia Campus. She writes on national socio-economic policy and has delivered various presentations at national and international platforms.

The views expressed by the author are not necessarily those of Heinrich Böll Stiftung.

Posted in Elections, Ethno-Religious Politics, General Politics, Public Administration, Reflections | Leave a comment