Gloomier economy poses poll risk to BN

By Lee Wei Lian, The Malaysian Insider

The prime minister could be pressured into calling an election by early next year to minimise damage to the government’s political standing due to a deteriorating economic outlook, says Nomura in its Malaysia outlook report for 2012.

The research arm of Japan’s leading brokerage and financial services group also said that a surge in new voters since the last general election will mean stiffer competition at the polling booth.

“The clock is ticking faster. Speculation is rife that the next general election could be held within months,” said the report.

Nomura’s outlook report for 2012 said Malaysia is vulnerable to a potential slowdown in China. — Reuters pic
It also said that as Asia’s third most export-oriented economy after Hong Kong and Singapore, Malaysia is vulnerable to a potential slowdown in China.

“In such a scenario, Malaysia would end up in a vulnerable position. Its three key growth engines — the public/private sector economy, manufacturing exports and commodity resources — would likely be in much weaker positions, in our view,” said Nomura.

The government, however, has maintained that the economy will remain resilient despite fiscal turmoil in advanced countries in Europe and increasingly strident reporting on concerns about China’s real estate bubble.

Officials cited high commodity prices that are expected to boost rural spending and intensification of projects linked to the Economic Transformation Programme that will help bolster domestic demand as reasons for GDP growth forecasts consistently above those from independent economists.

Nomura also said in its report that the pool of eligible voters had grown by 1.9 million to 16.3 million at the end of the first quarter of this year and the increase in eligible voters could hit 3.2 million by the first quarter of 2013.

“Taking into account the 2.58 million registered voters who did not turn out in the 2008 elections, we estimate the increase in the number of people who actually vote could reach 9.43 million, a highly significant number, which we believe would likely intensify competition given that the ruling coalition only won by a mere 384,688-vote majority in 2008,” said the report.

Nomura noted, however, that not all eligible new voters are likely to be registered by the next general election and put a conservative estimate at 1.69 million new votes, or 17 per cent of the total turnout.

As at July last year, Pakatan Rakyat (PR) was leading in the voter registration drive, signing up twice as many voters as Barisan Nasional (BN) in the first six months of 2010.

The DAP was also leading in signing up more voters compared with other political parties, registering 32.5 per cent of the new 169,838 voters registered between January and June last year.

Umno followed, registering 32.3 per cent of the new voters, with PAS at 22.7 per cent.

But even if PR were to win the popular vote count with the new voters, it does not follow that it would win government.