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Malaysia will be unstable until elections take place

Friday, March 6, 2020

Subject

Malaysia's government crisis.

Significance

King Abdullah on March 1 swore in Malaysian United Indigenous Party (PPBM) President Muhyiddin Yassin as prime minister, believing Muhyiddin now commands a parliamentary majority. This followed a week of political turmoil that began when the PPBM’s Mahathir Mohamad resigned as premier. Mahathir’s move came after the PPBM and a breakaway faction of the People’s Justice Party (PKR) left the Pakatan Harapan (PH) coalition, which had come to power nationally in 2018. Muhyiddin leads a new Perikatan Nasional (PN) coalition, which has wrested power in two states as well as nationally following the PH’s fragmentation.

Impacts

  • The risk of widespread protests will grow while parliament’s next sitting is delayed.
  • If the PN government remains in place, at least in the medium term, its links to past corruption could impact Malaysia’s credit ratings.
  • The PN will halt transparency initiatives put in place by the PH since 2018 but probably not reverse them entirely.

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