Malaysia Public Policy

Current policy

Malaysia is a country located in the region of Southeastern Asia. See abbreviation for Malaysia. The May 2018 parliamentary elections marked a historic shift in power in Malaysia. The National Front (BN), which had ruled the country since independence in 1957, was then defeated by the relatively newly formed opposition Hope Alliance. This could happen since BN’s former strong man, Mahathir Mohamad, has been at the head of the opposition. In February 2020, however, the government fell due to internal fragmentation. It paved the way for Umno’s return to government power.

A strong contributing cause of the fall of the BN government in spring 2018 was also the so-called 1MDB scandal. At the center of the extensive corruption crisis was the country’s then prime minister Najib Razak, who was also chairman of BN and the alliance’s dominant party, the Malay nationalist Umno.

  • Countryaah: Country facts and history of Malaysia, including state flag, location map, demographics, GDP data, currency code, and business statistics.

Already in May 2015, it was revealed that the state investment fund 1MDB (1Malaysia Development Berhad) was heavily indebted. Suspicions soon arose that the fund had been misappropriated by its board, whose chairman was Prime Minister Najib Razak. 1MDB had been established in 2009 by Najib Razak, who has since had great control over the fund.

The 1MDB scandal is growing

The scandal grew when the Deputy Prime Minister in June that year openly criticized the Prime Minister for how he handled the scandal. As a result, Najib Razak dismissed his deputy along with four other ministers. The national prosecutor, who held the investigation, was also kicked by Najib Razak.

In July, The Wall Street Journal revealed that $ 681 million had been raised from 1MDB to Najib Razak’s private account. The Office of the Auditor General’s audit confirmed this. Najib Razak refused all involvement in this.

The scandal seemed to temporarily subside when the anti-corruption agency in August declared that the amount deposited into Najib Razak’s account was a private gift from Saudi Arabia’s royal house. Najib Razak was considered free of suspicion of receiving money from 1MDB and in January 2016, the preliminary investigation against him was closed.

Mahathir Mohamad becomes opposition leader

The tours around the 1MDB fund divided the Malays into two camps: those who were for the controversial prime minister and those who opposed him. The latter group belonged to Mahathir Mohamad. In 2016, he made a political comeback with the stated goal of dismissing Najib Razak, whom the old leader accused of abuse of power and considered corrupt. In the same year, Mahathir Mohamad formed his own party, Bersatu.

Since elections were announced in May 2018, the opposition within the Hope Alliance, in January of that year, appointed the old Umnol leader as its prime ministerial candidate. The opposition’s obvious leader was otherwise Anwar Ibrahim from the People’s Justice Party (PKR), who, however, remained incarcerated since 2015 after a criticized trial and was prevented from acting politically (see Modern History). PKR and Bersatu were part of Hope’s alliance, as were a few other parties.

During the period leading up to the election day, the BN-dominated parliament made several criticized decisions. In March, it decided to redraw the constituency before the election. Both the opposition and independent election observers felt that the changes increased BN’s chances of winning the election. In April, a law was passed that made it criminal to spread fake news. Anyone found guilty could be sentenced to up to six years in prison. Critics felt that the law was used to silence government-critical media and opposition voices before the election. The law was scrapped by the new government after the election.

Historical shift in power

The electoral movement became fierce with strong tensions between the two political camps. The words of praise hail between the prime ministerial candidates, and the opposition accused the government side of widespread electoral fraud. According to Bersih, a Malaysian organization that works with election monitoring, a number of irregularities were discovered in connection with the registration of voters.

On election night, it was clear that Malaysia was facing its first reign of government in 60 years. The Hope Alliance had received 113 of the 222 mandates. BN had backed from 133 seats in 2013 to 79. Najib Razak admitted to being defeated. He resigned as leader of Umno and BN, and was replaced at both positions by Vice President Ahmad Zahid Hamidi. That Mahathir Mohamad had not let go of the 1MDB scandal became clear when Najib Razak and his wife were charged with a travel ban.

Already the day after the election, Mahathir Mohamad was installed as the new prime minister and began to appoint his ministers. He also announced that the king would soon pardon the imprisoned Anwar Ibrahim, which happened a week later.

Mahathir Mohamad said he intended to stay as prime minister for up to two years and then hand over the board to a successor. The reason was that Anwar Ibrahim could not immediately become prime minister since he must first be elected in parliament.

After the election close enough, the whole BN collapsed when 10 of the 13 parties that made up the alliance jumped off. Only the three original parties were Umno, Chinese MCA and Indian MIC (see Political system).

In October 2018, the new BN and Umno leader Ahmad Zahid Hamidi was also prosecuted for money laundering and bribery. Two months later, he handed over his leadership to his Deputy Prime Minister Mohamad Hasan until further notice, as the pressure within the party on his departure became too great.

The 1MDB scandal is gaining momentum

One of the first decisions Mahathir Mohamad made as new prime minister was to reopen the investigation into the 1MBD scandal. A series of police raids were made against Najib Razak and his family’s property. In July 2018, Najib Razak was prosecuted for corruption, money laundering and abuse of power on a number of points. He was accused of embezzling $ 540 million from the fund. The defendant maintained that he was innocent of the crime. Several trials were initiated against him in 2019.

Najib Razak’s wife, Rosmah Mansor, was also indicted in October 2018 for money laundering and tax evasion.

In the same month, Anwar Ibrahim regained a seat in Parliament through a filling election, in November he was unanimously elected as the leader of PKR.

During the autumn, the government scrapped a number of planned China-supported infrastructure projects that the old government had entered into as part of China’s huge infrastructure initiative BRI (Belt and Road Initiative, or New Silk Road). The motivation was that the projects would be too expensive for the indebted Malaysian state. In some cases, however, the projects were resumed.

In January 2019, King Muhammad V abruptly abdicated without any further explanation. It was the first time in Malaysia’s history that the head of state resigned prematurely. The 49-year-old Muhammad V was king for two years. New king became Abdullah Riayatuddin al-Mustafa Billah Shah ibni Sultan Ahmad Shah.

In September 2019, Umno and PAS joined an alliance whose goal was to attract Muslim voters ahead of the 2023 elections.

The government is falling

At the end of February 2020, Malaysia was thrown into a new political crisis after Prime Minister Mahathir Mohamad unexpectedly filed his resignation application. His four-party government had failed after a long period of tensions and factional formation. Parts of the government had left Hope’s alliance and instead tried to form a new government together with, among other Umnopolitics. The aim should have been to prevent PKR leader Anwar Ibrahim from taking over the post of Prime Minister after Mahathir Mohamad. In the new government, Anwar Ibrahim and PKR would have been excluded.

Mahathir Mohamad was said to have resigned in protest against the attack on his government and sources close to him said he was still behind Anwar Ibrahim. However, the fact that Mahathir Mohamad had long refused to clarify when he intended to hand over his post to Anwar Ibrahim had contributed to creating the strong tensions within the government.

Mahathir Mohamad resigned as leader of Bersatu. He was commissioned by the king to, as acting prime minister, govern the country with a transitional government until a new ordinary government could be in place.

After a few days, the situation began to clear around Mahathir Mohamad’s sudden departure. A power struggle had again erupted between Mahathir Mohamad and PKR leader Anwar Ibrahim. While Mahathir Mohamad as acting prime minister began the work of forming a transitional minister, Anwar Ibrahim said that the Alliance of Hope had nominated him as the new prime minister. However, the hope alliance had in practice collapsed. It was unclear if Mahathir Mohamad was behind the attempt to bypass Anwar Ibrahim, but judges considered him likely to at least know it. Mahathir Mohamad’s proposal to form a unifying government across party borders won no support in the political camps.

New Umnoledd government

After a series of new tours in the struggle for power, the king unexpectedly stepped in and appointed a third person, Tan Sri Muhyiddin Yassin, as new prime minister. Muhyiddin Yassin, who formally took office a day later, was a low-profile former Interior Minister supported by two Muslim-dominated parties, including Umno. He was described as an Islamic nationalist.

Muhyiddin Yassin was highly regarded within Umno until 2015, when then-Prime Minister Razak Najib threw him out of the party after criticizing Umno’s handling of the 1MDB scandal. Muhyiddin Yassin then supported Mahathir Mohamad’s new coalition. In connection with the new tours, Muhyiddin Yassin returned to the camp.

Mahathir Mohamad called the king’s decision “illegal” and said he had a majority of the MPs behind him.

Some time in March 2020, Prime Minister Muhyiddin Yassin presented a new government with Ministers from Umno and a small Muslim party. Several of the government members had joined the old government under Najib Razak. Thus, after less than two years in opposition, Umno regained power.

Read more about the events in the Calendar.

READING TIP – read more about Malaysia in UI’s web magazine The Foreign Magazine:
At “ringside” when Mahathir resigned last time – 2003 (23-23-2018).


Official name



monarchy, federal state

Head of State

kung (yang di-pertuan agong) Abdullah Riayatuddin al-Mustafa Billah Shah ibni Sultan Ahmad Shah (2019–)

Head of government

Prime Minister Tan Sri Muhyiddin Yassin (2020–)

Most important parties with mandates in the last election

Hope Alliance 113, National Front 79, Malaysia’s Islamic Party (PAS) 18, Sabah’s Legacy 8, Independence and Others 4 (2018)

Main parties with mandates in the second most recent elections

National Front 133, The National Front 89 (2013)


85% in the 2013 parliamentary elections, 83% in the 2018 parliamentary elections

Upcoming elections

parliamentary elections 2023