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Anwar’s Malaysia Leadership Push Derailed in Rural Heartland

Photographer: Sanjit Das/Bloomberg

Anwar Ibrahim, Malaysia's opposition leader, center, listens during a news conference at the One World Hotel in Kuala Lumpur on May 5, 2013. Anwar disputed the election results and called for an opposition rally on Wednesday at a stadium in Selangor outside of Kuala Lumpur. Close

Anwar Ibrahim, Malaysia's opposition leader, center, listens during a news conference... Read More

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Photographer: Sanjit Das/Bloomberg

Anwar Ibrahim, Malaysia's opposition leader, center, listens during a news conference at the One World Hotel in Kuala Lumpur on May 5, 2013. Anwar disputed the election results and called for an opposition rally on Wednesday at a stadium in Selangor outside of Kuala Lumpur.

Malaysia’s Anwar Ibrahim struggled to swing voters in government strongholds where his own ethnic group is dominant, thwarting his ambition to take power from a ruling coalition he helped lead before his ouster in 1998.

Prime Minister Najib Razak, 59, won a 133-seat parliamentary majority on May 5, even though he received just 47 percent of the popular vote, Election Commission data showed. Anwar’s own party and another made up mainly of ethnic Malays did worse than in the last election in 2008, while his ally, the mostly ethnic-Chinese Democratic Action Party, improved, giving the three-party opposition 89 seats.

Anwar failed to woo enough Malay voters after campaigning to end affirmative action programs that benefited them and that had led Chinese voters to oppose Najib’s administration. The result shows the legacy of the 65 year-old, who has yet to concede, may be in transforming Malaysia into a competitive democracy, rather than in enacting policy.

“Whatever happens, Malaysia has been changed,” said Clive Kessler, emeritus professor at the University of New South Wales in Sydney, who has analyzed the nation’s politics for half a century. “All sorts of new forces have been energized, but on the other hand the old forces of Malay ethno-centrism have been given a new lease on life.”

Record Turnout

The election saw a record turnout of 85 percent, with Najib’s governing Barisan Nasional coalition failing to win more than 50 percent of the vote for the first time in 44 years.

The political future of Anwar, a former deputy prime minister who served under former Prime Minister Mahathir Mohamad in the 1990s before being fired, hinges on his ability to hold together his ideologically disparate opposition. The group’s biggest shared goal had been the unseating of a regime in office since Malaysia’s 1957 independence.

Anwar disputed the election results and called for an opposition rally tomorrow at a stadium in Selangor outside of Kuala Lumpur. He vowed to stay in politics until the electoral process becomes fairer.

“There is clear evidence of fraud,” Anwar said in an interview with Bloomberg Television yesterday. “Malaysia must mature as a vibrant democracy. We cannot continue with this semi-authoritative government.”

Malay Competition

The Anwar-led People’s Justice Party won 30 seats, one less than in 2008, while the Pan-Malaysian Islamic Party took 21, two short of its previous tally. Both are Malay-dominated parties that competed with Najib’s United Malays Nasional Organisation in many constituencies they contested.

In declaring victory yesterday, Najib said he came to power largely on the back of ethnic Malay support after a “Chinese tsunami” moved against his coalition. Ethnic Malays account for about half of the country’s 29 million people, while Chinese make up roughly one-quarter and the rest are mostly ethnic Indians or indigenous groups.

“Despite the extent of the swing against us, Barisan Nasional did not fall,” Najib told reporters.

The biggest vote swing occurred in Kedah, one of peninsular Malaysia’s poorest northwestern states. Three in four voters there are Malay or indigenous, collectively known as Bumiputera. Najib’s party took 10 of 15 seats in the state, up from four in 2008.

District Breakdown

In other states where Bumiputera make up more than 70 percent of the population -- Perlis, Pahang, Terengganu, Kelantan and Sarawak -- Najib’s coalition won 67 percent of seats. In Selangor, Penang and Kuala Lumpur -- districts that have the smallest proportion of Bumiputera -- Anwar’s group took 78 percent of seats.

“The only thing Anwar failed to do is to make further inroads into the rural Malay heartland,” Mohamed Nawab Mohamed Osman, research fellow at Singapore’s S. Rajaratnam School of International Studies, said by phone. “If it was anyone else I would’ve said his political future is finished, but it is Anwar Ibrahim. He already came back from the political dead.”

Anwar was seen as Mahathir’s heir apparent until the 1997 Asian financial crisis. As finance minister, Anwar gave speeches citing Austrian economist Joseph Schumpeter’s theory of creative destruction. In the case of Southeast Asia, that meant countries would emerge stronger from the crisis, Anwar said.

Anwar Fired

Mahathir disagreed. In 1998 he fired Anwar, pegged the currency and imposed capital controls. Within a month, Anwar was arrested. He spent the next six years in prison on convictions for abuse of power and sodomy, only to be released in 2004 after Mahathir retired and a judge overturned the guilty verdict for having sex with a man.

Anwar, who then taught at Georgetown University and the Johns Hopkins School of Advanced International Studies, both in Washington, won back his parliamentary seat in 2008 when he was again eligible to run. He vowed to lead the opposition to power within a month by winning over defectors from the ruling coalition. That effort failed and he fought off a second sodomy charge, on which he was acquitted last year.

Najib’s victory sent stocks and the currency soaring. The ringgit yesterday had its biggest one-day jump since June 2010, and further strengthened 0.5 percent to 2.9656 against the dollar as of 9:27 a.m. local time, earlier reaching a 19-month high, according to data compiled by Bloomberg.

Stock Market

The FTSE Bursa Malaysia KLCI Index (FBMKLCI), which had lagged behind other Southeast Asian benchmarks this year, jumped as much as 7.8 percent to a record before finishing 3.4 percent higher yesterday. It closed up 1.4 percent today.

Government-linked shares led yesterday’s gains, with UEM Land Holdings Bhd. (ULHB) leaping as much as 17 percent and Malaysian Airline System Bhd. (MAS) rising as much as 26 percent. CIMB Group Holdings Bhd. (CIMB), a lender headed by the prime minister’s brother, Nazir Razak, advanced as much as 14 percent.

Anwar, who focused his campaign on cronyism in the ruling group, had associates split away from him in the past decade, said Chandra Muzaffar, a former deputy president of his party. Chandra, who supplied Anwar with books when he was imprisoned in the 1970s as a student activist fighting rural poverty, said he abandoned the opposition leader over his shifting views.

“He was capable of presenting himself as the most liberal among certain audiences, while at the same time he’s quite comfortable hobnobbing with individuals who are more inclined toward jihadist type of politics,” said Chandra.

Even so, he praised Anwar for pushing Najib’s alliance to loosen restrictions on the media and public gatherings.

While Anwar may not have another shot at bringing down his former colleagues, he’s already made a “tremendous impact” on the country, said Frederic Neumann, co-head of Asian economics research at HSBC Holdings Plc.

“He can already be pretty proud,” Neumann said yesterday. “He’s broken open the political discussion in Malaysia.”

To contact the reporter on this story: Daniel Ten Kate in Bangkok at dtenkate@bloomberg.net

To contact the editor responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net

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