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Malaysia in transition

Muhyiddin quits as Malaysia PM after plea for bipartisanship fails

Country faces uncertain transition from shortest-serving leader amid COVID crisis

Malaysian Prime Minister Muhyiddin Yassin leaves his residence in the morning of Aug. 16.   © Getty Images

KUALA LUMPUR -- Malaysian Prime Minister Muhyiddin Yassin tendered his resignation on Monday after his largest coalition ally cornered him and the opposition rejected a last-ditch appeal to maintain stability.

"I have resigned together with the ministerial cabinet, as stipulated in the federal constitution," Muhyiddin said in a televised address in the afternoon, after a special cabinet meeting and an audience with King Sultan Abdullah Ri'ayatuddin, where he handed in his notice.

"I could have tested my support in the parliament as I told all of you before, but 15 UMNO MPs withdrew their support for me and my offer for bipartisan political cooperation was turned down by the parties, leaving me with no choice but to resign," he added, referring to his coalition's erstwhile partner and the country's largest party, the United Malays National Organisation.

The 74-year-old cancer survivor is the shortest-serving premier in Malaysian history.

The palace also confirmed Muhyiddin's resignation in a statement, with Sultan Abdullah thanking him for his service in fighting COVID-19. The king made Muhyiddin a caretaker prime minister, without a ministerial cabinet, until the next leader can be sworn in.

Ahmad Fadil Shamsuddin, comptroller of the royal household, explained in the statement that the move was in line with the constitution, which states the king must appoint a lower house member believed to command majority support.

Ahmad Fadil also said the king does not favor dissolving parliament for a general election. The king was informed by the Election Commission that 79% of constituencies are red zones, with high numbers of new coronavirus cases. "Thus the king believes that holding the 15th general election is not the best choice given safety and security factors of the people," the comptroller said.

Muhyiddin's resignation caps a tumultuous 17 months in power, during which his government grappled with not only the pandemic but also coalition infighting and repeated leadership challenges.

Until last week, Muhyiddin had insisted he would stay on and test his majority in a September parliament session. He argued that resigning would compromise the battle against COVID-19 and the nation's economic recovery. But he conceded that he needed backing from at least some opposition members in a televised address last Friday, promising them perks and an election by July 2022 in exchange.

Though some politicians appeared willing to hear him out, opposition leaders rejected the call.

"I'm aware that millions of Malaysians appealed for me to stay and continue the fight against the pandemic," Muhyiddin said on Monday. "But I couldn't because I have lost the majority in the parliament. I did try to keep the National Alliance administration alive until the 11th hour, but all those efforts were futile because of some parties' greed for power."

Now Malaysia faces an uncertain transition just as it contends with one of the region's worst coronavirus outbreaks, with around 20,000 daily infections.

For Oh Ei Sun, a senior fellow at the Singapore Institute of International Affairs, the resignation was "long overdue."

"Muhyiddin would have resigned the moment he felt he doesn't have the majority if he had any constitutional decency, and would not have waited until he was shown the door," Oh said. The analyst said the priority now is to get a new government in place "as soon as possible."

With the king ruling out a snap election, it is up to the monarch to pick a successor from a pool without an obvious leading candidate. Muhyiddin himself said, "I hope the king would appoint a new prime minister soon, to ensure smooth implementation of the government machinery." With over 30% of the population fully vaccinated, he continued, "The next two months would be very crucial for Malaysia as we would head toward the herd immunity target by October-end."

Names generating buzz include outgoing Deputy Prime Minister Ismail Sabri Yaakob, longtime leadership hopeful Anwar Ibrahim and 11-term parliament veteran Tengku Razaleigh Hamzah.

Ismail and Tengku Razaleigh both belong to UMNO. It was UMNO that helped Muhyiddin oust Mahathir Mohamad as prime minister last year. This time, too, it was UMNO that triggered Muhyiddin's downfall.

The party announced in early August that it had gone to the king with signed letters from lawmakers retracting support for the government. This effectively stripped the Muhyiddin-led National Alliance coalition of its already questionable parliamentary majority.

The final straw appeared to be a spat over Muhyiddin's abrupt cancellation of a COVID-19 state of emergency and various related ordinances, without the king's consent. This drew a rebuke from the palace. UMNO President Ahmad Zahid Hamidi said Muhyiddin "must take responsibility by relinquishing his position immediately as a result of his failure to adhere to and clash with the king's advice."

Muhyiddin, for his part, has argued that his foes were out to get him for refusing to intervene in corruption cases. "I know they are not happy about my stance of refusing to entertain some of their demands, which include insisting that I interfere in judiciary affairs to release some of the individuals currently under criminal trials," he said earlier this month. Again on Monday, he noted that he was sacked as deputy prime minister six years ago "for standing up against 1MDB and corrupt government practices."

Key UMNO figures Ahmad Zahid and former Prime Minister Najib Razak face separate criminal charges for alleged corruption and power abuse.

But Muhyiddin had also made several attempts to placate UMNO -- or at least a faction within the party -- and cling to power. Ismail's appointment as deputy prime minister in early July was seen as part of that effort. His faction within UMNO, which sources say is larger than Ahmad Zahid's, is thought to have stayed behind Muhyiddin to the end.

Regardless, UMNO had already said in March that it would not team up with Muhyiddin's Malaysian United Indigenous Party (Bersatu) whenever the next general election was held.

Economically, the impact of the power change is likely to be limited, according to Christian Fang, vice president and senior analyst at Moody's Investors Service.

"Although a period of political uncertainty may occur in Malaysia given the resignation of Prime Minister Muhyiddin Yassin, we expect the country's credible and effective institutions to limit the impact on its macroeconomic policies and credit profile as demonstrated over past episodes of abrupt political change," Fang said.

The bigger risk stems from ongoing COVID-19 infections and restrictions -- a challenge Muhyiddin's successor will have to confront from Day One. Fang warned, "If fiscal deficits remain wide for some time because of further economic stimulus or weak revenue, resulting in a persistent rise in the government debt burden that fiscal authorities are unable to reverse, this has the potential to materially weaken Malaysia's credit profile."

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