Malaysia Paddy Fields Are Najib’s Battlefield to Woo Voters

Standing near paddy fields that stretched to the horizon, Malaysian Prime Minister Najib Razak had one message for voters of the rural district of Sungai Besar: My government will take care of you.

Fairuzita Mohamad Amir, who was in the crowd Najib addressed earlier this month in the state of Selangor, voted on Saturday in a by-election that saw his United Malays National Organisation crush the competition. The 51-year-old widow grows rice on 2.5 acres of land with the help of subsidies plus access to fertilizers and pesticides, for which she credits UMNO.

"I learned to say UMNO along with my ABCs," Fairuzita said. "Over the years, they have helped me a lot. I need their support and they have mine."

Najib needs to keep smallholders like Fairuzita happy as he seeks the votes of rural and semi-urban areas to retain power in the next general election due by 2018. Farmers -- many of them ethnic Malays -- are a linchpin for his party, which leads one of the world’s longest-ruling coalitions. Their votes have a higher weighting than their work, which contributes to less than a tenth of gross domestic product.

Najib Scandals

"Even as Malaysia becomes more developed, the importance of the farmers and the rural voters remains intact," said Khor Yu Leng, an analyst who has published papers on Malaysia’s political-economy including voting trends in the 2013 election. "The concentration of seats in farming areas is quite big for Malaysia, and UMNO will want to strengthen that."

At stake for UMNO is the unbroken rule of its Barisan Nasional coalition since independence in 1957. The party is watching Najib’s ability to shake off a year of political turmoil and focus on bolstering a slowing economy.

UMNO’s victories with bigger majorities in Sungai Besar and a northern state on Saturday indicate Najib passed the first test of public support on peninsular Malaysia since the scandals broke. Cabinet ministers made daily trips to the districts before election day, shaking hands and at times handing out bags of rice to the poor. An opposition in disarray, which fielded multiple candidates in each seat, also assisted UMNO.

Malaysian farmers have been hit by falling commodity prices, rising living costs and a stock investment that hasn’t always delivered what was promised. Najib has responded by pledging bigger subsidies for rubber planters and rice farmers in the 2016 budget. He announced monetary handouts this month for rubber farmers totaling 194 million ringgit ($47.5 million).

Farmers, Fishermen

Najib, 62, has battled graft accusations since July, and denies wrongdoing. He was cleared by the attorney general this year over revelations that $681 million appeared in his accounts before the last election in 2013. The money was a donation from the Saudi royal family and most was later returned, the government said. 

The premier has also been embroiled in probes into the finances of troubled state fund 1Malaysia Development Bhd, while former leader Mahathir Mohamad and opposition groups sought to whip up anger over a goods and services tax that was imposed in 2015.

"Farmers and fishermen are from the mainstream Malay heartlands and those heartlands are key to Barisan Nasional regardless of any issue, whether it’s about GST or 1MDB," said Ahmad Martadha Mohamed, dean of the college of law, government and international studies at Universiti Utara Malaysia. "If the prime minister continues to provide support to these groups, they will continue to support him in the future."

Electoral Map

The importance of rural voters can be seen in Malaysia’s electoral map. Settlers under Malaysia’s Federal Land Development Authority -- a government agency known as Felda formed in 1956 with World Bank funding to help steer the rural poor out of poverty by providing them with land to plant -- are backbone voters in over 50 districts, according to the Merdeka Center for Opinion Research.

In the last general election there were 125 rural seats and 54 semi-urban ones, of a total of 222, said Khor.

"State assistance touches every aspect of their lives -- an education grant for their children, an entrepreneurial grant, a house, or do they want to choose to go on their own," Khor said of smallholder farmers, who number more than 600,000. "It might appear illogical to vote for the opposition because what if you get punished?"

‘All Because’

Still, some farmers have expressed unhappiness over a decline in the value of their shares in Felda, while others have criticized management’s investment decisions. Shares in Felda Global Ventures Holdings Bhd. have fallen 67 percent since its listing in 2012. 

"They make investment decisions without thinking them through and we are the ones paying a price," said Saifuddin, a Felda settler who would give only a partial name. "I understand there’s nothing they can do about the price of palm oil because that’s world prices. But that doesn’t explain enough why the shares are doing badly."

Najib in March asked second- and third-generation settlers to continue backing the government, saying he wants the group to be a "political powerhouse" and without that influence, Felda could cease to exist. The Felda leadership has backed UMNO’s claims of its role in helping settlers out of poverty.

"No one thinks about the Malays except UMNO, we must remember that," Felda Global chairman Mohd Isa Abdul Samad said last month. "Our successes are not because of our own cleverness. Many Malays forget. It’s all because of UMNO."

At the next election, Najib will probably further target the bottom 40 percent of the population who can swing votes in tight races.

Isman Abdul Karim, who grows palm oil on a 5-acre plot of land near Sungai Besar, won a manual oil palm roll picker at an event organized by the Ministry of Plantation Industries and Commodities in the days before the by-election. Other prizes included bags of fertilizer, and a motorized palm oil fruit cutter.

The father of nine settled on the land in the early 1960s, and says his life has improved over the years. One child received a government scholarship to study in the U.S. and is now a computer engineer. Independent smallholders like him make up about 13 percent of palm oil planters, according to the Economic Planning Unit.

"I’ve been a UMNO supporter from way back," the 78-year-old said, resting in a shed at his plantation. He works the land alone though gets help to pick oil palm fruits. "We used to get a lot of support for the land but now not so much. But there is no other party but UMNO for me."

--With assistance from Anuradha Raghu and Manirajan Ramasamy To contact the reporter on this story: Shamim Adam in Kuala Lumpur at sadam2@bloomberg.net. To contact the editors responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net, Daniel Ten Kate