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Two Malaysia camps emerging in fight to form new government

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Two main political camps have begun to emerge in the race to form Malaysia's next government, and interim leader Mahathir Mohamad could end up leading either one of them.

[KUALA LUMPUR] Two main political camps have begun to emerge in the race to form Malaysia's next government, and interim leader Mahathir Mohamad could end up leading either one of them.

On one side is the former ruling coalition Pakatan Harapan, which collapsed on Monday when Dr Mahathir resigned as prime minister and his party withdrew from the alliance. At a meeting on Tuesday night, the remaining members of the coalition - accounting for 41 per cent of seats in parliament - agreed to stick together.

On the other side is the opposition coalition Barisan Nasional, which had ruled the country for six decades until 2018, and an allied Islamic party. Together they account for 27 per cent of the legislature.

In the middle is Dr Mahathir and a group of disparate factions that have pledged to continue supporting him as leader. The 94-year-old leader has stayed silent the past few days as he weighs options including whether to link up with either bloc, seek another combination of parties, or call a fresh election.

The political turmoil has cast a pall over a slowing economy that reported its worst growth rate since 2009, and hampers its ability to mitigate the impact of the coronavirus outbreak and trade wars. With Dr Mahathir the only one remaining in government after the Cabinet was dismissed, it's unclear how and when he'll be able to unveil a stimulus package that was supposed to be announced on Thursday.

The current power struggle also complicates Anwar Ibrahim's quest to finally become prime minister, marking another twist in the decades-long rivalry between him and Dr Mahathir. The distrust between them dates back to the 1990s, when Mr Anwar was ousted from Dr Mahathir's Cabinet and arrested for sodomy at a time when both were members of the Barisan Nasional coalition.

Anwar had been in line to take power from Mahathir after the two joined together in the Pakatan Harapan coalition to win the 2018 election, ousting a coalition that had ruled for six decades. Yet Dr Mahathir repeatedly delayed handover of power, prompting divisions within the ruling bloc to fester - eventually leading to its collapse this week.

On Wednesday, it was still unclear which bloc would come out on top. The king, who plays a largely ceremonial role in Malaysia's British-style system of government, planned to continue meeting with lawmakers from all camps to help him determine who has the support of the majority to become the prime minister.

The dispute appears to be splitting along racial lines, which have played a major role in Malaysia's politics for decades. The opposition alliance is refusing to work with the Democratic Action Party, the second-largest party in parliament with 42 of 222 seats. The multiracial party has many ethnic Chinese leaders in the majority Malay country, including former Finance MinisterLim Guan Eng, who said he had finalised the package on Sunday and submitted it to Dr Mahathir.

Mr Anwar's party has said it's sticking with the DAP as part of the Pakatan Harapan alliance. If Dr Mahathir wanted to reconfigure the coalition that collapsed Monday, possibly with a few regional parties, he could easily have the numbers to form a government.

It would be more difficult for Mahathir to gather the numbers by siding with the opposition coalition. It would require the support of a host of regional parties and defectors from the former ruling coalition, including a faction led by Azmin Ali, who was vying with Mr Anwar to succeed Dr Mahathir.

Dr Mahathir himself has kept his cards close to his chest. His statements to the media were sparse compared to his usual pronouncements and frequent speaking appearances.

BLOOMBERG