Malaysia Lawmakers to Reconvene for Budget Amid Poll Speculation

(Bloomberg) -- Malaysia’s parliament will reconvene Monday for its final seating of the year, as analysts study the tabling of the 2023 federal budget later in the week for clues on when the next elections may be called.

The meeting will run through Nov. 29, and 25 of the 32 days will be devoted to the passage of the budget, according to the parliament website. Speculation has intensified after the ruling party said late Friday it has decided parliament should be dissolved soon, and that Prime Minister Ismail Sabri Yaakob will seek an audience with the King to propose a dissolution date.

An election isn’t due until September 2023, but Ismail is under pressure from factions within his United Malays National Organisation party to hold polls as soon as possible. The opposition and some ruling party politicians have warned against having an election during the flood season that begins November after floodwaters late last year left dozens dead and led to losses estimated at more than 6.5 billion ringgit ($1.4 billion).

The 2023 budget will likely focus on people-centric spending ahead of elections, the World Bank said this week. A bigger concern for foreign investors is the need for structural reforms in areas including education and labor policies, said Apurva Sanghi, the bank’s lead economist for Malaysia.

READ: Malaysia’s Ruling UMNO Party Pushes for Election This Year

In 1999, the Malaysian parliament was dissolved days after the spending plan was presented, and a general election was held later that month. A fresh budget was tabled again by the new government months later.

“Given that this budget will be tabled before the next general election, we expect it to be election-friendly with expansionary measures,” United Overseas Bank economists including Julia Goh wrote in a report last month. “Although the economy has made a strong comeback since the pandemic, there are rising downside risks for 2023’s outlook amid concerns of a global recession, elevated energy costs, persistent inflation pressures, and lingering geopolitical uncertainties.”

READ: Malaysia Braces for Damaging Floods in Test to PM as Polls Loom

Ismail has several legislative agendas to push through in the upcoming session. These include bills to ban smoking for those born from 2007, ones related to political funding and the mandatory death penalty, and a move to cap the tenure of a prime minister to two terms.

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