Nobody really expected it. Many people I interviewed and spoke to acknowledged that while the ground sentiment was heavily against the incumbent political party of more than six decades (61 years – Barisan Nasional led by Najib Razak), most of us thought BN would still retain power albeit by a slim majority.
In fact, we were debating a very real possibility of a hung government – where no one political party wins a “clear and simple” majority. That would have been complicated in itself.
But as with many recent social developments, we have been active bystanding observers to a historical event – one that I feel will have major geo-political and social impact in the region.
Return of the Strongman
Led by nonagenarian (92 year old) former strongman Prime Minister of 22 years, Tun Mahathir, the loose coalition of multiple political parties swept into power on the back of winning traditional Barisan powerbases of Johor, Sabah, Selangor, Pahang and Perlis. The message was loud and clear. The people have had enough and they threw in their lot with the coalition of Pakatan Harapan.
Malaysian politics, at the best of times, has been a fluid, dynamic ephemeral concept that ebbed and flowed with the trends and sentiments from the ground. The return of the strongman has had both sides of the aisle excited and debating animatedly on the mertis or the lack of in the case of Mahathir succeeding. Social media and informal chat groups and networks were alive with chatter – on the why’s, wherefores’, if’s and but’s.
What’s in it for ASEAN?
But this hammer blow to the incumbent means Malaysia and indeed ASEAN (Association of Southeast Asian Nations) are in for a ride. The power wrangling and struggle within Pakatan Harapan has just started and pre-election promises or swift decisions to reverse hugely unpopular but probably logical economic and social programmes may take a while longer.
With focus on seemingly, retribution, for an incensed and disenchanted population, the new leader of the government Tun Mahathir has commented on popular issues including reversing the Goods and Services Tax (implemented in 2016), the impending High Speed Rail (HSR), East Coast Rail Link (ECRL) and the NusaJaya (Forest City) development project in Johor.
The rhetoric has only served to heighten an already skittish market with analysts counselling that reversing economic programmes like the GST and HSR will have short to medium term repercussions on the competitiveness and value of the Malaysian economy.
Malaysia’s neighbours in ASEAN, especially Singapore and Indonesia must be nervous, as they wait for the dust to settle. Tun Mahathir had a rather fractious and tense relationship with his counterparts when he served as the country’s fourth Prime Minister from 1981 to 2003. In an age where the ASEAN has actually functioned and collaborated in more collectively effective fashion, this definitely is a spanner in the works.
The environment has changed
It wont be impertinent to note that the political and economic climate and landscape has changed significantly over the last 15 years in the region. Malaysia is home today, to some of the largest and most critical data centres in the region supporting global operations of multinational banks (ABN Amro, ING Bank, Maybank, CIMB), auto manufacturers, retailers, regional telecoms giants and leading budget airlines. It is still one of the leading suppliers of timber, rubber and boast some of the more sophisticated logistics operations for global companies in the region.
Late last year, Alibaba, the Chinese internet giant launched with great fanfare its regional presence in Kuala Lumpur. Hot on its heels, Tencent, the Chinese social media phenomenon has announced plans to launch into the region from Malaysia. These were developments prior to GE14 and it was peculiarly interesting that both saw Malaysia as unique launch platform ahead of other potential sites in Southeast Asia.
Questions to be answered
What are the potential repercussions and reaction to Mahathir’s ascension (resurrection?) to power. How will the grand plans for a next generation multi purpose Forest City development project in the South (Johor) be impacted by the change in government? What about the nascent support for the Chinese One Belt One Road initiative now fare with the new premier? Chineses investors are heavily leveraged in prime properties in the heart of Kuala Lumpur and Petalig Jaya. How will a xenophobic, insular pro-Malay agenda sit with the foreign investments?
How will the new government adapt to a new generation approach, shedding a notoriously infamous pro-Malay, pro-Malaysia rhetoric to embrace change, foreign investment (mainly Chinese) and new technologies
How is the nature of the current cooperative, collegial relationships with its immediate neighbours Indonesia, Thailand and Singapore now change or morph?
Many questions remain to be answered. But right now, Mahathir and Pakata Harapan have to deal with public anxiety for action by way of comeuppance for the previous regime (realization of instant karma), results and order. They have to sort out the power politics and the optics of any action deriving from their actions or non-action.
Whatever happens in the next 100 days, it will be ground breaking – just as the first year of the Trump Presidency has been in the US. Many established norms of the previous regime, international political and economic agreements may be revisited. There will be confusion and some short term chaos.
But after all of the “gropping in the dark”, there will be a period of clarity, order and calm, one hopes. But it requires a steady hand and an even approach. Tun Mahathir has been there before and will dig deep into his reservoir of knowledge, nous and ultimately social capital to make things happen.
In the meantime, opportunists will recognize the potential to leverage the situation to grow and develop in the country and the region. One thing is for sure, it is going to be an interesting 2018 for Malaysia.
The fundamentals are strong. The economy despite all of the doom and gloom under Najib has been chugging along nicely on 2-3% growth year on year, on the back of increasing foreign direct investments. The start-up scene has never been more vibrant and dynamic since the early 2000s. The country has diversified into other areas, divesting its reliance on oil revenue, reinventing itself as a credible data centre, logistics, business process outsourcing and Islamic financial hub. The skilled talent is world class but the country still suffers from a brain drain. However, there is a recognition that the country’s potential is not fully realized.
Regardless, I foresee developments on the horizon. As they would say in local parlance – Akan Datang!
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