In June 2002, Malaysia's Prime Minister Dr. Mahathir Mohamad, surprised the world by offering to step down from power.

In tears, Malaysia's longest serving prime minister offered to turn over the reigns to his fourth deputy Abdullah Ahmad Badawi, affectionately known as 'Pak Lah'.

For the last year, Malaysia has been in transition mode, as politicians, businessmen and ordinary citizens alike prepare for new leadership.

As power transitions go, this one is very stable and drawn out, reflecting the high level of control that Mahathir has managed to consolidate during his 22-year tenure.

He stewarded the transition in much the same manner as he governed Malaysia over the last few years, with calculating management.

In assessing the political dynamics in Malaysia, it is important to recognise that a number of parties in both the governing coalition, the Barisan Nasional (BN or National Front), and in the opposition are undergoing leadership changes.

Besides Umno, two major parties, MCA and PAS have changed leaders in the past year, each with different ripple political effects on the system.

Another opposition party, Keadilan has merged with Parti Rakyat Malaysia, to become Parti Keadilan Rakyat. This has affected the middle ranks of leadership within the party.

This trend of leadership transitions is likely to continue over the next few years. After all, six of the 20 longest-serving party leaders in the world are Malaysian.

Changes in Umno

The focus of this essay, however, is on the change in the dominant political party, Umno, which Mahathir has led since July 1981. It has been the leading political party in Malaysia since 1970, after the pivotal racial riots of 1969, and a major force beforehand since independence.

Below, I argue that the transition has increased factionalism within Umno, which is unlikely to resolve itself until the party elections which are expected to be held in the middle of next year.

The political transition will play out largely outside of the public eye, in established political arenas, with an unlikely spillover beyond elite politics.

This contest will be fierce and fluid, as Umno elites will jockey for positions in the post-Mahathir environment with the aim of placing them in line for future party leadership in what many, although not all, expect to be a short tenure of Mahathir's chosen successor.

Factionalism in Umno is not new. During the Mahathir years, however, factionalism deepened as a result of the bottleneck in the party hierarchy. Younger elites, who come from the majority of the Malay population, had limited opportunities to rise through the ranks.

At the same time, Malaysia's greater wealth, often tied to pivotal and lucrative opportunities of state access, provided party members with greater financial rewards. The combustible combination of money and limited advancement fostered competition.

In the early years of the Mahathir era, this took the form of a direct challenge to his leadership. In 1986-1987 Tengku Razaleigh Hamzah (photo), under the rubric 'Team B' (which incidentally included Abdullah) split Umno and directly challenged Mahathir's leadership.

Mahathir survived the contest by a slim majority of votes in the party election. This contest, like the current elite contestation, had limited societal spillover.

In the wake of the split, elite contestation centered on the lower positions within the party, particularly division chiefs. These contests remained largely elite affairs.

It was not until 1998, when Anwar Ibrahim (photo) challenged Mahathir in the party elections, that Umno contestation mobilised ordinary Malaysians. Under the rubric of reformasi Anwar's challenge seriously undermined the ethnic base of the party, as Malays flocked to the opposition in the 1999 polls.

It is estimated that Malay support for Umno dropped from 61% to 42% in the 10th general elections. The party, however, remained intact, as a popular, although less dynamic, leader, Abdullah replaced Anwar in the deputy's position.

Murkier scenario

In both these leadership contests, Umno factionalism was largely shaped by personal loyalties to individuals, although in each case there were different views of economic policy (the level of state involvement in the economy in 1986 and response to the Asian financial crisis in 1998) and the development of Umno as an institution.

The current scenario does not offer the same degree of personal loyalties and policy differences, although these factors are present under the surface. Since this is a power transition as opposed to a leadership challenge, factionalism within Umno has become more murky.

The current scenario contains many similarities with the back-door party negotiations that characterised the 1976 leadership transition after the illness of the second prime minister, Tun Abdul Razak.

In that instance, Tun Hussein Onn (photo) won leadership by being the most amenable contender to party elites. In the current transition, the leadership decision was made almost exclusively by Mahathir - who rebuilt Umno after the 1988 split - in his shadow and emphasised personal loyalty.

Many elites are waiting for their opportunity within the party to voice their positions and will do so in the next party elections.

During the last year, as the transition has unfolded, the lines of support for key leaders within Umno have shifted constantly, as individuals within the rank-and-file have searched for 'safe' positions in the post-Mahathir environment as well as aimed to advance their future positions.

Electoral security

The factors that have shaped factionalism within Umno have less to do with personalities and policy than with the resources that provide security for future positions.

These include: state patronage, electoral support, personal ties, capable domestic leadership and a credible international persona.

State patronage, or the distribution of funds, traditionally has been a major factor for Umno party members. In the 1970s, the expansion of the public sector deepened the tie between the bureaucracy and party leaders.

The New Economic Policy, fueled by increased revenue from oil, massively expanded public spending for the Malay community, particularly in education. The boundaries between the bureaucracy and party became blurred.

Through the 1980s, state distribution remained important, yet the locus moved to the private sector. Umno became more tied to business and access to state resources through 'rents'.

As academicians Edmund Terence Gomez and Jomo KS have shown, contracts, licences and financial gains from privatisation took on more significance.

Umno elites remain interested in securing their financial position. In this regard, ties to ministries and agencies that distribute these 'spoils' will be crucial as the elite struggles unfold.

Equally important for Umno elites is demonstrating strong electoral support. The 1999 polls dented the political fortunes of rising elites.

Perhaps the hardest hit by the general election, was Defence Minister Najib Tun Razak, who only squeaked by with a 261 majority, despite winning the most votes in the party election for a vice-presidency the following year.

The Umno rank-and-file will be looking for leaders who have electoral security, especially in the wake of the 1999 contest in which Malay voters abandoned the party in high numbers. They want to ride on the coat-tails of a strong leadership team that will secure their own electoral fortunes.

This is particularly salient since the challenge from PAS at the polls remains significant, especially in the Malay rural areas of Kelantan, Terengganu, Pahang, Kedah and Perlis.

While the recent delineation exercise strengthens Umno, through the creation of more ethnically mixed constituencies, the party continues to face the challenge of winning back Malay support, especially among younger voters.

Since Abdullah will likely have the power to influence the selection of candidates, the forthcoming general elections (likely in the first quarter of 2004), will be a major test for his party stewardship and other party elites.

Influence of social capital

The factor least understood and appreciated by analysts of Umno is the centrality of personal ties and relationships. Previous party conflicts in 1986-1987 and 1998 illustrated the role of personal loyalty within Umno.

This feature has long been associated with Malay leadership, which has been seen by some analysts as having feudal roots. The issue of personal ties goes beyond loyalty and moves into more intangible issues of character and perceptions of individuals around leaders.

To coin a phrase from contemporary political science, the Umno rank-and-file and elites are assessing leaders for their 'social capital'. They are looking at the level of trust, confidence and richness of their social networks of both the leaders and those close to them, from family members to staff.

This practice is facilitated by the fact that insiders within Umno politics have a high degree of familiarity with others, due in large part to the extensive social ties, shared education experiences and intermarriage among families.

Popular leaders with rich networks and connections, often buttressed by connections at the state level and bonds formed within youth organisations of the party, have the advantage; they have a strong social base to build their support. Leaders with spouses and family members that are popular among other spouses and with other family members also gain support.

The importance of social capital within Umno has been shaped by the rise in character assassinations that have become more common in Malaysian politics. This practice was perhaps most famously recently demonstrated in the Anwar episode, but extends to a broader range of individuals with roots back to the attacks on Tengku Razaleigh after the 1986-1987 party split.

Character and morality matter more politically today than they did pre-Mahathir. These issues have become more important in political campaigns, due in part to greater Islamisation among the Malay community and in part due to the rising electoral challenge of PAS.

Umno members are concerned with how individuals are perceived by the electorate and by others within the party. Leadership contenders are scrutinised for perceived 'character' flaws, real or imagined. One of Abdullah's strengths is that many see him as passing the 'character' test, thus passing this important 'personal' obstacle.

Capable leadership

Paralleling assessments of the social capital of individual elites is a deep-seated pragmatic thread in Malaysian politics. Party members want capable leadership and Mahathir himself has set the bar.

His leadership has been credited for Malaysia's impressive economic performance and the reduction of open ethnic tensions. Malaysians, both within and outside of Umno, want the strengths of Mahathir's leadership and correctives on its weaknesses, in areas such as clean government.

All of the leadership contenders for positions in Umno will be judged on their ability to create and implement policy. Most face the problem of having to come out of Mahathir's shadow and many are not credited with achieving specific policy objectives.

The issue of capable leadership translates within the rank and file in that it is tied to electoral support, particularly among middle class and Chinese voters, as well as the foundation for state patronage.

The final factor shaping the murky factional contests within Umno is the issue of a credible international persona. Mahathir's strong role on the international scene, in areas from the Look East Policy and North-South relations to recent discussions of terrorism, have accustomed Malaysians to leadership with strong international recognition and presence.

Upcoming leaders within Umno will be commended for the ability to move between domestic and international arenas -- to be fluent in Malay and English, to be both effective within the party and among diplomats.

This dimension, although less significant than the others, factors into the capable leadership criteria mentioned above and plays a role in shaping internal loyalties within Umno.

All of the power contenders for leadership positions have mixed fortunes in these areas, thus the constant fluidity during the transition, which will continue to unfold during the next year. The key position will be the selection of the deputy prime ministership. This, however, is not the only important position.

Power will come from the portfolios in government, not just the position within the party hierarchy. In turn, the portofolios will shape the level of state patronage and translate into other dimensions of power within Umno.

Electoral challenge

The internal elite contestation will initially weaken Umno, which has weakened considerably in the wake of the arrest and beating of then deputy party president and deputy premier Anwar in 1998 and subsequent loss of Malay support in the 1999 polls.

The immediate affect of a weaker Umno will be higher levels of uncertainty in the political process, which will primarily resonate at the elite level. What distinguishes the ongoing contestation is a common bond in survival, the challenge of another political party.

This threat is PAS, the Islamic opposition party, which poses a real electoral challenge in Malay areas. Although the BN has won all but two of the nine by-elections since the 1999 polls, doubts remain, particularly those with narrower majorities.

The focal point is not a loss at the national level, which is extremely unlikely due to the support in East Malaysia and strength of support among Chinese voters, but rather a loss in the Malay heartland, where Umno derives its political legitimacy.

The party needs a decisive victory among Malay voters to re-legitimise itself at the polls as winning the majority of Malay support.

The new leadership en masse needs this confirmation, and thus this common bond will limit the scope of infighting. This will contribute to constraining the conflict within the bounds of existing contests.

Irrespective, Umno elite contestation will remain central as the transition evolves. The focus of Umno elites will remain on consolidating their position in domestic politics, particularly within the party.



DR BRIDGET WELSH is assistant professor in Southeast Asian studies at John Hopkins University-SAIS, Washington DC. The second part of her article will be posted tomorrow.


The author referred to the following sources for the article, which first appeared in Woodrow Wilson Center Asia Program's Special Report on Malaysia, and which will soon be published in a book "Reflections: The Mahathir Years'.

  • See A. B. Shamsul. 1988. "The 'Battle Royal': The UMNO Elections of 1987," in Mohammed Ayoob and Ng Chee Yuen (eds). Southeast Asian Affairs, 1988, pp. 170-188.
  • See Bridget Welsh, Forthcoming. "Real Change?: Elections in the Reformasi Era," in Edmund Terence Gomez, The State of Malaysia: Ethnicity, Equity and Reform, London: RoutledgeCurzon, pp. 162-193.
  • Edmund Terence Gomez and Jomo, K.S. 1999. Malaysia's Political Economy: Politics, Patronage and Profits. Cambridge: Cambridge University Press.
  • See Ong Kian Ming and Bridget Welsh. Crisis and Reaction: Malaysian Elections under the Microscope. Manuscript in progress.
  • A.C. Milner. 1982. Kerajaan: Malay Political Culture on the Eve of Colonial Rule. Tucson, Arizona: University of Arizona Press.