Malaysians to Vote May 5 in Country’s Close Fight for Power

Malaysians will go to the polls on May 5 in what is expected to be a close fight as Anwar Ibrahim’s opposition seeks to end 55 years of unbroken rule by Prime Minister Najib Razak’s National Front coalition.

The campaign period is extended to 15 days from 12 days in the 2008 election, following calls by pro-democracy protesters for more time for voters to assess candidates. The nomination day for candidates is April 20, Abdul Aziz Mohd Yusof, Election Commission chairman, told reporters today in Putrajaya, outside of Kuala Lumpur, when announcing the polling plans.

“It’s long overdue,” Maria Chin Abdullah, a spokeswoman for the Coalition for Clean and Fair Elections lobby group, said by phone. “We were asking for 21 days. Even with 15 days, we’re still concerned whether all overseas votes will come in time to be counted.”

Najib, facing voters for the first time as prime minister, has pledged to fight corruption and bring down living costs as the National Front looks to fend off a resurgent opposition led by Anwar, who has also promised to improve the lives of ordinary Malaysians. Najib has boosted cash handouts to the poor and Anwar has flagged more such payments if he is elected.

Brokerages from RHB Capital Bhd. to Citigroup Inc. are expecting a closer result than 2008, when the National Front secured its narrowest victory since the country’s 1957 independence from Britain.

Street Protests

The Coalition for Clean and Fair Elections, or Bersih, held mass demonstrations last year and in 2011 to call for changes to the country’s voting laws. At one of the gatherings last April, police arrested more than 500 people for defying a ban of street protests introduced by Najib’s government a month earlier.

“The prime minister is looking forward to the election and to making his case to the Malaysian people,” a government spokesman said in an e-mailed statement after the announcement.

The prospect of the incumbent government losing more parliamentary seats has left the FTSE Bursa Malaysia KLCI Index a laggard behind benchmarks in Indonesia, Thailand and the Philippines, with the gauge little changed for the year even after closing at a record today. The ringgit rose as much as 0.6 percent to 3.0182, its strongest level since January 18, before falling 0.2 percent as of 5:16 p.m. local time after the polling date was set.

Voters’ Concerns

“I don’t see any impact on the market in the short term until the polling date,” Jason Chong, who oversees $1 billion of assets as chief investment officer at Manulife Asset Management Services Bhd. in Kuala Lumpur, said by phone today. “It has been talked about for so long. Those who wanted to sell would have sold, those who are bullish would have bought. The key is when the results are announced.”

The Election Commission will implement 19 reforms following recommendations by a parliamentary select committee, including using indelible ink to mark fingers to prevent multiple voting and a code of ethics, Abdul Aziz said.

“This will be one of the most peaceful elections,” the chairman said.

Tackling the twin issues of corruption and living costs is of key concern to voters, alongside crime, said Oh Ei Sun, a senior fellow at the S. Rajaratnam School of International Studies in Singapore. The National Front “perhaps can tackle economic issues better because they can push through more development programs,” while governance and curbing graft are “strong points” for Anwar’s People’s Alliance given its track record in states it currently governs, said Oh by phone.

Economic Expansion

Najib, 59, inherited an economy in recession when he took over in 2009 when Abdullah Ahmad Badawi stepped down as prime minister. The 13-party National Front lost its long-held two thirds majority in parliament in the 2008 election and currently holds 137 seats in the 222-member assembly, with Najib’s United Malays Nasional Organisation the biggest party in the coalition.

Malaysia’s economy has expanded by more than 5 percent for each of the past six quarters through the end of 2012, buoyed by domestic demand and investment.

The country’s Gini coefficient, a measure of income inequality, fell to 0.431 last year from 0.441 in 2009, according to data from the Statistics Department. The closer the figure to 1.0, the greater the inequality. The data show the gap between rich and poor among bumiputeras -- ethnic Malays and indigenous peoples -- narrowed 4.3 percent during the period, while income inequality among Chinese people fell 0.7 percent and for Indians widened 4.5 percent.

The government has raised salaries of civil servants, police and the military to woo voters while planning $444 billion worth of private sector-led projects over the next decade from mass rail to oil storage that have attracted companies such as Carrefour SA and General Electric Co.

‘Cautiously Optimistic’

Najib, who dissolved parliament last week and will serve in a caretaker capacity until the elections, told reporters in Kuala Lumpur on April 4 he was “cautiously optimistic” about winning “big,” regaining a two-thirds majority in parliament. Anwar also said in an interview the same day he was “cautiously optimistic” about his coalition’s prospects.

Anwar, 65, leads an ideologically disparate opposition that includes one party with mostly ethnic Chinese and another whose members support the wider implementation of Islamic law. He spent six years in prison until 2004 on corruption and sodomy charges that he says were politically motivated. The charge of having sex with a man was eventually overturned.

He has pledged to revamp racial preferences for bumiputeras and trim the budget deficit through cost savings if he wins. His coalition, which holds 75 parliamentary seats, also wants to raise the minimum wage, lower oil and electricity prices and increase cash handouts to the elderly and students.

(Updates market prices in eighth paragraph.)
    Before it's here, it's on the Bloomberg Terminal. LEARN MORE