At issue now is whether the ruling Barisan Nasional coalition he leads is capable of pushing through reforms which many believe are vital for the long-term prospects of the coalition.
Najib, who spearheaded the BN’s campaign in Kuala Terengganu, capital of the oil-rich east coast state of Terengganu, was unable to stop a swing to the Pakatan Rakyat, made up of the three main opposition parties.
The ruling coalition had won the Terengganu seat by a 628-majority in last March’s watershed general election, which saw the opposition making sharp inroads, wresting control of five states in the 13-state federation.
But this time, Kuala Terengganu fell to PAS, representing the Pakatan, by a 2,631 majority. Much of the vote swing came from young Malays, and that spells trouble in the long run for Umno, the dominant party in the BN coalition.
Although the by-election had no bearing on the balance of power – the Pakatan alliance increased its share of seats to 83 in the 222-seat Parliament – many saw it as a referendum on Najib.
The deputy premier is expected to take over the top job from Abdullah Ahmad Badawi in March, following a leadership transition scheme hatched out last September by Umno leaders, who had effectively pinned the blame for the BN’s general election setback last year on Prime Minister Abdullah.
This time much of the responsibility for the defeat falls on Najib’s shoulders. ”If Najib thought he was going to have it easy, this by-election has been a rude shock for him,” says opposition activist Medaline Chang, who helped to campaign for Pakatan in Kuala Terengganu.
It was the second time Najib had led the ruling coalition to defeat in a by-election campaign. Last August, the ruling coalition lost the Permatang Pauh by-election to another Pakatan party, the PKR.
That by-election saw the alliance’s de facto leader – and now Parliamentary Opposition Leader – Anwar Ibrahim, returning to the House after a 10-year absence.
Where money politics failed
The heavy deployment of state machinery in the by-election campaign and the massive mainstream media campaign which provided lop-sided coverage in favour of the BN could not stem the tide.
Opposition activists, independent journalists and bloggers provided a counterweight, repeatedly highlighting over the Internet cases of money politics and the use of government allocations to influence voters.
It was the third time in 10 months that money politics had failed to halt the opposition’s momentum. “The great thing about the results of the Kuala Terengganu by-election is that the old politics of the Barisan Nasional will no longer work,” says P Ramakrishnan, president of the social reform group, Aliran.
”The past winning formula – money, media and machinery – could not woo the voters to throw in their support for the BN,” Ramakrishnan said.
As if the burden of taking over the premiership is not heavy enough, Najib, the son of Malaysia’s second premier, Abdul Razak, also holds the key finance portfolio.
He faces a huge challenge as Malaysia’s export-oriented economy slows in tandem with the global slowdown.
Weakening global demand for semiconductors and electronic products and a slump in petroleum and palm oil prices will make this a difficult year with more job losses expected.
Najib himself has been implicated in the murder of a Mongolian woman – though he has vehemently denied any links to the case – for which two special forces operatives are on trial.
Meanwhile, top Umno leaders recognise that the party will have to reinvent or reform itself if it wants to check its slide and remain in power after the next general election.
Najib has asked BN leaders to move out of their comfort zones and build closer rapport with the people or be punished at the next general election.
He said that development projects must be based on the needs of the people – an admission of sorts that many projects had not been people-oriented in the past.
”The BN government cannot afford a disconnection between the people’s aspirations and the government’s direction,” he was reported as saying.
But the big question now is whether, after five decades of holding power, Umno is capable of instituting such reforms given that corruption and vote-buying are so pervasive and a system of patronage is deeply entrenched.
Umno needs reinvention, not rebranding
Umno vice-president Muhyiddin Yassin said Najib would have to perform “political surgery”.
”The people want radical improvements after what happened in the last election,” he was reported as saying. ”We must be able to do something that would attract the public.”
He said the party had to be reinvented and not just re-branded.
But it’s not just Umno that needs to be reformed. The credibility of key democratic institutions has suffered under BN rule, as critics believe their independence has been compromised to ensure that the BN retains its grip on power.
Reforms to the judiciary, law enforcement and anti-corruption agencies and the Election Commission are deemed essential in restoring the eroding credibility of the BN government.
Outgoing premier Abdullah is determined to push through legal reforms to restore the credibility of some of these institutions. Already he has tabled two bills in Parliament – the Malaysian Anti-Corruption Bill and the Judicial Appointments Bill.
A third on the police force and other enforcement agencies completes his agenda – though he has promised to see through the implementation even after leaving office in March.
But after failing to push through such reforms at the height of his popularity following a landslide general election win in 2004, it remains to be seen whether the BN, particularly a wounded, divided Umno, has the political will to now ensure meaningful reforms.
Umno might not have the stomach to do so, especially when such reforms could bring to a premature end the careers of many party functionaries and even loosen the BN’s stranglehold on power.
“This by-election leaves the BN having to some deep soul-searching,” says Chang, the opposition activist.
”I think they need to look outwards and get outsiders to provide some frank views as the people in the BN seem to be in a state of perpetual denial.”
The next electoral tests will come in the form of possible by-elections and elections to the state assembly of Sarawak, another resource-rich state considered a stronghold of the ruling coalition.
Faced with a resurgent opposition alliance, Najib will have to battle hard to restore his – and the ruling coalition’s – battered fortunes.