Malaysia Said to Prepare for Potential Election in May or June

By Manirajan Ramasamy - Mar 16, 2012 9:21 AM GMT+0700

Malaysia’s government is discussing the possibility of an early election in May or June, ahead of the due date in early 2013, according to four officials who spoke on condition of anonymity because the talks are private.

Prime Minister Najib Razak is scheduled to speak on March 26 to as many as 4,000 information ministry staff, who help oversee elections, the government officials said. One date proposed for the contest is June 3, according to three of the officials.

The ruling National Front coalition is seeking to extend its 55 years in power, and an early vote would allow Najib to take advantage of rising public approval after the government announced cash handouts and vowed to overhaul security laws. Satisfaction with Najib’s leadership rose to 69 percent last month from 59 percent in August, according to a poll by the Merdeka Center for Opinion Research.

“All signs seem to be pointing toward an election at the end of May or early June,” Ong Kian Ming, a political analyst at UCSI University in Kuala Lumpur, said by phone. “It’s the best timing for Najib. If he does wait longer there may be other scandals that emerge and the goodwill that he’s enjoying from the budget handouts given out earlier this year may be lost.”

Election Sweeteners

While Najib has offered election sweeteners, he is also grappling with a potential scandal after a member of the ruling party said she’ll resign from the Cabinet amid a corruption probe against her husband. Shahrizat Abdul Jalil will step down next month as minister for women, family and community, according to the Star newspaper.

Najib had already sparked speculation of an early vote when he said in December that preparations had begun for the contest. His budget announced in October featured cash payments to low- income families.

Malaysia will also announce plans for a minimum wage this month, a government official said earlier this week. Najib’s cabinet has yet to complete the plan, according to the official.

Najib’s rising popularity has reduced the risk of a surprise election result such as one that occurred in 2008 and led to a stock market sell-off, according to a March 13 report from Bank of America Merrill Lynch. In 2008, the ruling National Front lost a third of its seats.

Stock Rise

Since Najib took office in April 3, 2009, the benchmark FTSE Bursa Malaysia KLCI Index (FBMKLCI) has risen 74 percent compared with a 47 percent gain for the MSCI Asia Pacific index.

“The Prime Minister is focused on delivering prosperity, security and democracy for all Malaysians and will call an election when the time is right for the country,” a Malaysian government spokesperson said by e-mail.

Malaysia’s opposition leader Anwar Ibrahim was acquitted of sodomy charges in January that he claimed were politically motivated. He pledged to “clamor for reform” in a bid to unseat Najib after the verdict.

Gross domestic product may expand 5 percent to 6 percent this year, Najib said in the annual budget speech on Oct. 7. The economy expanded by 5.1 percent last year, the government said Feb. 15.

Before 2008, the worst showing for the National Front was in 1969, when candidates representing urban ethnic Chinese and rural Islamic opposition groups won more than a third of seats in Parliament. Ethnic Chinese victory marches prompted a backlash from Malay groups that led to emergency rule.

Najib’s father, Abdul Razak, took over as prime minister in 1970 and responded by creating an affirmative-action policy that gave Malays educational, housing and job preferences.

To contact the reporter on this story: Manirajan Ramasamy in Kuala Lumpur at rmanirajan@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net