What worries both economists and analysts is the political challenges facing the government.
The Malaysian political landscape that Mr Anwar now presides over is seriously scarred.
It marks the first time since independence in 1957 that power is now largely in the hands of political parties that are openly multi-racial in makeup and ideology. This is a clear break from the identity politics of race and religion that has long characterised Malaysia, which is dominated by ethnic Malay Muslims who make up nearly 65 per cent of the population.
Mr Anwar’s PH and its partners in government, which include ethnically diverse groups from the East Malaysian states of Sarawak and Sabah, now control 148 seats in Parliament. This majority gives the new ruling government a two-thirds majority in the 222-member lower house, marking the first time since 2008, when the then-ruling Barisan Nasional coalition lost the supermajority.
The opposition, which for the first time in history is made up by solely by Muslim Malay political entities, comprising Parti Pribumi Bersatu Malaysia (Bersatu) and the right-wing Parti Islam Se-Malaysia (PAS), has begun campaigning that Mr Anwar’s government is not doing enough for the Malay community.
The big test for the new unity government will come sometime in June when six states, comprising Selangor, Negeri Sembilan, Penang, Kelantan, Terengganu and Kedah, are expected to hold simultaneous elections for their respective state assemblies.
The ruling coalition controls Penang, Negeri Sembilan and Selangor, while the three other Malay-belt states are controlled by the opposition Perikatan Nasional (PN) coalition.
The PH coalition would find it very difficult to wrest control of the states currently held by the opposition and the major concern is that the states it currently control could face serious electoral setbacks that would suggest further slippage in the support from the Malays.
“Status quo would be a good outcome, but a loss in any PH state will be damaging for Anwar,” said Mr Syed Azman, the political science lecturer.
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