MALAYSIA'S Prime Minister Ismail Sabri Yaakob announced the dissolution of Parliament on Monday afternoon (Oct 10), triggering a snap general election that must be held within the next 60 days, well ahead of the original September 2023 deadline.
During an audience at the palace on Sunday, the King had given consent to dissolve Parliament on Monday in accordance with Article 40 (2)(b) and Article 55(2) of the Federal Constitution, said Ismail.
"With this announcement, the mandate will be returned to the people. The people's mandate is the antidote to ensuring political stability and to forming a strong, stable and respected government," he said in a televised address to the nation.
"People should use their power to elect a competent government to continue implementing Budget 2023, maintain political stability and revive the country's economy as well as unite the multi-religious and multi-racial Malaysian family," he said, adding that the dissolution of parliament should quell voices questioning the legitimacy of the alleged backdoor government.
These accusations arose after Ismail was named prime minister by the King in August last year, with the support of 114 members of parliament, and the Barisan Nasional (BN) coalition returned to power. This was controversial because, at the last general election in 2018, the six-decade-old BN coalition led by the United Malays National Organisation (Umno) in fact lost to the Pakatan Harapan (PH) coalition led by former prime minister Mahathir Mohamad.
That was the first time the country experienced a change of power since independence in 1957. Since 2018, there has been growing political uncertainty, with three prime ministers within four years due to infighting and the lack of a clear majority in Parliament.
In a statement issued by the palace after Ismail's announcement, Sultan Abdullah Ahmad Shah expressed his disappointment in recent political developments, saying that this left him no choice but to give his consent for the dissolution of parliament to form a new and stable government.
The King urged the election committee to conduct the election at the earliest after taking into consideration the south-west monsoon, which is expected to begin in mid-November. Ong Ooi Heng, a parliamentary affairs researcher, expects the election to be held in the first week of November to avoid flooding in many states.
"The general election 1999 is a good example (of elections being held within 30 days) as the polls were held on Nov 29, after parliament was dissolved on Nov 11," he told The Business Times.
One advantage for the BN government is the Budget 2023 announcement made last Friday, said Ong. Malaysia's Finance Minister Zafrul Aziz introduced a RM372.3 billion (S$114.6 billion) Budget in Parliament - the second largest annual federal spending on record, after Budget 2022.
Ong noted that Budget 2023 has something for all income groups, and the BN coalition may use this as their manifesto to convince voters of their future direction.
Lau Zhe Wei, an associate professor at the International Islamic University Malaysia's Department of Political Science, noted that the goodies in Budget 2023 are now "promises" after parliament's dissolution: "This means the new government will have a choice (as to) whether they want to honour their promises depending on the government coffers."
Nevertheless, he felt there will be more certainty to the country's political landscape after the election, which could help to regain foreign investors' confidence.
But Oh Ei Sun, a senior fellow at the Singapore Institute of International Affairs, expects the political landscape in Malaysia to remain fragmented. Although Umno is likely to have a larger share of parliamentary seats, they might not clinch an outright majority, he said.
This would make it necessary to form "a ruling coalition of convenience" again, "presaging further rounds of inter-party fights for dominance", he told BT. "This is not to mention the incessant Umno internecine power struggle."
Many businesses hope that there will be a clearer development direction with more political stability. In an Oct 3 report, Fitch Solutions Country Risk and Industry Research maintained Malaysia's short-term political risk index score at 64.8 out of 100, saying that the country will continue facing heightened political uncertainty until the election is over.
In an Oct 10 report, OCBC economist Wellian Wiranto said the crucial question for Malaysia's economy is whether the general election will result in "a more grounded political setup", especially as the country "is likely to enter a softer patch in 2023 due to the more unsettled global environment, amid lingering inflation risks and limited fiscal space".
Malaysia saw significant growth after the country reopened its borders this April, with second quarter gross domestic product (GDP) growth at 8.9 per cent year-on-year. The central bank has raised interest rates three times this year to tame soaring inflation, with another round expected in November, as inflation hit a new high of 4.7 per cent in August on the back of higher food prices.
But the ringgit is still weakening and thus hurting profits as business costs rise. The ringgit was trading at RM4.65 against the greenback on Monday, approaching the historical low of RM4.88 reached in 1998 during the Asian financial crisis.