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Malaysian PM resigns

KUALA LUMPUR, Apr 2 – Malaysia’s Prime Minister Abdullah Ahmad Badawi resigned on Thursday after six years in office, clearing the way for his deputy to take over the task of steering the nation out of economic crisis.

Najib Razak will be sworn in on Friday, completing a transition that has been in the planning since elections last year in which the ruling United Malays National Organisation party (UMNO) put up its worst performance in 39 years.

The incoming prime minister has said he would focus on a programme to unite the multi-racial nation, whose ethnic minorities shifted towards the opposition in large numbers in the 2008 polls, fearing their rights were being eroded.

"I think this new thrust will ensure there will be a fairer distribution of government allocations and assistance to all communities," Najib said on Wednesday.

Najib and Abdullah had successive audiences with King Tuanku Mizan Zainal Abidin at the royal palace on Thursday, and a senior official said AFP the prime minister’s resignation had been accepted.

"PM Abdullah offered his resignation to the king. The king is understood to have accepted it," the official told AFP on condition of anonymity.

Najib was last Thursday officially declared president of UMNO, effectively smoothing his path to the premiership because of its dominance of the political scene. He is due to be sworn in as prime minister at 0200 GMT on Friday.

UMNO represents the majority Muslim Malays who make up 60 percent of the population and dominate the government.

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Analysts say Najib faces an enormous challenge to rejuvenate the party, which has floundered since last year’s elections, and cushion the country from the worst effects of the global meltdown.

Malaysia, Southeast Asia’s third largest economy, has been hit by slumping exports and manufacturing, with more than 26,000 people losing their jobs so far this year.

A slew of economic data for January underlined the scale of the problem.

Industrial output fell 20.2 percent year-on-year, manufacturing sales sank 22.7 percent and exports plunged 27.8 percent to hit their lowest level since 2001.

Najib, who is also finance minister, unveiled a stimulus package worth 16.2 billion dollars earlier this month, but warned that the export-driven economy could shrink by 1.0 percent this year despite the massive spending.

He will face his first big test as prime minister next Tuesday with three by-elections that will be seen as a referendum on his fledgling leadership.

"He will inherit a divided party with trust in the government at its lowest ebb and a strong opposition," political analyst Shahruddin Badaruddin told AFP earlier.

He said Najib’s challenge would be "to unite the fractured elements of the party."

Najib has an impeccable pedigree as the son and nephew of two former prime ministers, but he has been dogged by controversy which the opposition said he would have to address.

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Najib has repeatedly denied opposition allegations connecting him to the 2006 slaying of the mistress of his close aide — a Mongolian woman whose body was blown up with military-grade explosives.

"I think Najib’s promises to improve the economy will mean nothing until he clears his reputation which is marred by scandal," veteran opposition lawmaker Lim Kit Siang told AFP.

UMNO leads the ruling Barisan Nasional coalition, which has ruled Malaysia for more than half a century since the former colony gained independence from Britain in 1957.

The coalition of race-based parties – which also represent ethnic Chinese and Indian communities – were mauled by the opposition led by former deputy prime minister Anwar Ibrahim.

The opposition seized an unprecedented one third of seats in parliament and now controls three states.

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