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Malaysia Whispers Sow Doubts on Najib’s Ability to Win Votes

• At the 70th anniversary gala for Malaysia’s ruling party this month, 

  Prime Minister Najib Razak raised the party flag on stage as senior 

  leaders cheered him and sang the group’s anthem of unity and loyalty. 

  In the halls outside the venue, the chatter was less upbeat.

  Even as party leaders publicly pledge support, some have privately 

  expressed frustration over the scandal-hit premier -- and concern that 

  if they say too much they could be ostracized. In the past year, Najib 

  has removed his most vocal opponents from the party and government 

  machinery. While that means he is unlikely to face a challenge soon, 

  the risk may grow as the next election, due by end-2018, draws near.

  At stake is the unbroken rule since independence in 1957 of the 

  United Malays National Organisation, the biggest actor in one of the 

  longest-ruling coalitions in the world. Ethnic Malays are the bulwark 

  of that coalition, and Najib needs to keep them onside. UMNO leaders 

  are also keeping a close eye on rank and file supporters for signs of disquiet, 

  even as opposition parties remain weak and in some cases fractured.

  Najib, 62, has endured arguably one of his toughest years in four decades 

  in politics, battling graft accusations and fending off a joint campaign by 

  his ex-deputy and a former mentor against him. If anything he has 

  tightened his grip on the party, but there are pockets of dissatisfaction 

  within UMNO that may distract him from addressing slowing growth. 

  It’s the economy that’s the biggest threat to support from voters facing 

  rising costs.

  "Homogeneity in UMNO, like all political parties, is a challenge," said 

  Norshahril Saat, a fellow at the ISEAS-Yusof Ishak Institute in Singapore. 

  "It seems Najib still has strong support within UMNO. But Najib needs 

  to ensure he gets the economy moving again. That is the concern of the 

  masses, both in rural and urban areas."

  Najib has denied wrongdoing and was cleared by the attorney general 

  this year of graft over revelations that $681 million appeared in his 

  accounts before the 2013 election. The UMNO-led coalition won that 

  election by its slimmest margin yet, helped over the line by Malay 

  strongholds, and lost the popular vote for the first time. The money was 

  a personal donation from the Saudi royal family and most was later 

  returned, the government said.

  Divisional Chiefs

  The premier has also been embroiled in probes into the finances of 

  troubled state fund 1Malaysia Development Bhd. While Attorney 

  General Mohamed Apandi Ali cleared Najib of wrongdoing in accepting 

  funds from a company once linked to 1MDB, he also refused central 

  bank requests for criminal proceedings against 1MDB at least twice.

  The activities of 1MDB, which has also denied wrongdoing, are under 

  scrutiny in at least four overseas probes, while companies and individuals 

  linked to it have been investigated in at least six others.  

  For the latest on the 1MDB scandals, click here.

  Through it all, the UMNO divisional chiefs have publicly backed Najib.

  "The continued support for the current leadership is there and it’s strong 

  -- there’s no doubt about that," said Suhaimi Ibrahim, an UMNO committee 

  member for the division of Lipis in central Malaysia, where Najib was 

  born. "I must admit that it is not 100 percent as some members are 

  unhappy about some things."

  ‘Normal’ Unhappiness

  "The support among division leaders is very strong and I know that for 

  a fact," said Rubin Balang, division chief for Tenom in the state of Sabah 

  on Borneo island. "It’s normal that some people would be unhappy."

  While Suhaimi and Balang didn’t elaborate, some party officials alluded 

  to undercurrents in UMNO over eroded trust in Najib, asking not to be 

  identified given the risk of repercussions.

  "Najib knows he cannot be unseated by UMNO and UMNO knows that,

  " said a division chief from a northern state. "You cannot take him at 

  face value but he has UMNO support, so you just keep quiet." UMNO 

  did not respond to requests for comment.

  Whether the chiefs remain quiet depends in no small part on the 

  economy, with growth forecast to expand at the slowest pace in seven 

  years in 2016. As a net oil exporter, Malaysia has been hit by a two-year 

  slump in energy prices, while China’s slowdown has cut demand from 

  its second-biggest export market. The ringgit has see-sawed, turning 

  Asia’s best performance in the first three months of 2016 to the region’s 

  worst in the current quarter.

  
  

  ‘Survived’ Threat

  "I do think the worst is past" for the prime minister, said Edwin Gutierrez, 

  head of emerging-market sovereign debt at Aberdeen Asset Management 

  in London. "Najib has basically survived the threat," he said, and 

  Malaysian government bonds offer "some value.”

  Najib and other party leaders have spoken often about the importance 

  of unity, and the premier has restated UMNO’s primary agenda as 

  protecting the interests of ethnic Malays.

  "UMNO will stand firm to preserve the strength and honor of the Malays," 

  he said on May 11. "The interests of the race will always be the main 

  agenda in UMNO’s struggle. The party was founded on the awareness 

  for the need of unity and togetherness for the continuity of the race and 

  therefore the spirit should be preserved."

  Politics of Patronage

  UMNO has a feudal political culture that may keep the party behind Najib 

  even as the scandals make his leadership appear "untenable," said 

  Universiti Sains Malaysia political science professor Ahmad Fauzi 

  Abdul Hamid. The party structure also limits any push for real 

  change, he said.

  "UMNO politics is the politics of patronage, and as long as they have 

  connections with levers of power, they will not reform," he said. 

  "Najib’s government is a weak government -- in parliament or 

  by popular vote -- and they still haven’t reformed. They don’t have 

  to because they can remain in power."

  Najib has continued and in some cases expanded policies put in 

  place by his father -- Malaysia’s second prime minister Abdul 

  Razak Hussein -- that give preferential treatment to Bumiputeras, 

  the country’s Malay and indigenous people.

  ‘Very Capable’

  The ruling coalition, known as Barisan Nasional, secured a bigger 

  majority in recent polls in Malaysia’s biggest state of Sarawak, 

  which reflects the public’s confidence that BN is delivering, 

  Najib’s press secretary Tengku Sariffuddin told Bloomberg News 

  in an e-mailed comment.

  "The landslide result shows that the prime minister is very capable 

  of leading BN into the next general election," Tengku said. 

  "At a time of uncertainty in the global economy, he remains 

  focused on safeguarding the well-being and security of all Malaysians."

  Two by-elections next month may point to the voter mood on Najib, 

  especially given residual public anger over the implementation last year 

  of a goods and services tax.

  There is also upset over the way Mahathir Mohamad, who was premier 

  for 22 years until 2003, and some others were treated for publicly 

  criticizing Najib, some UMNO members say. The party in February 

  suspended its second-in-command and former deputy premier 

  Muhyiddin Yassin for undermining the organization, while Mahathir’s 

  son was replaced as chief minister of a northern state. 

  ‘Great Damage’

  "UMNO is still united, but not like before, and to some extent it has 

  lost its fire," said an official at UMNO’s Kuala Lumpur headquarters, 

  who’s been a party member for about three decades. "Great damage 

  has been done."

  Discontent is not unusual, and a fractured opposition gives 

  Barisan Nasional breathing space, Norshahril said. In the poll in 

  Sarawak, opposition parties fielded multiple candidates in some 

  seats, splitting their vote.

  "BN is in a relatively stronger position," said Norshahril, who has 

  studied Malaysian politics for a decade. With Najib announcing 

  plans to restructure his cabinet, "we can have a better picture. 

  This will give a clue how dynamics within the party is moving."

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