Anwar's Cabinet Crossroads: Who Will Fill Power Seats?

BusinessToday

24-05-2025

Following a bruising leadership council election, Prime Minister Anwar Ibrahim's party is now more divided than at any point since its founding in 2003. The recent polls saw the incumbent deputy president and Economic Minister, Rafizi Ramli, defeated by Nurul Izzah, who secured 9,803 votes. Tensions within the party were palpable throughout the campaign, with members clearly split between the two camps.
During PKR's national congress, party president Datuk Seri Anwar Ibrahim acknowledged his limited engagement with party affairs and pledged to dedicate one day each week to focus on internal matters.
However, his challenges are far from over. As Malaysia braces for a more turbulent economic landscape in the second half of 2025, Anwar now stands at a critical crossroads—one that may well define his leadership and shape the future of the unity government.
Two critical ministerial vacancies are now on the table: the Economic Affairs portfolio, vacated following Rafizi Ramli's defeat in the recent PKR party elections, and the International Trade and Industry Ministry, soon to be vacated with Senator Tengku Datuk Seri Zafrul Tengku Abdul Aziz's term expiring in December. Both are influential seats at the economic helm of the country, and their replacements cannot afford to be merely political appointments—they must be strategic moves that restore market confidence and steer the country through uncertain economic waters.
Anwar's Dilemma: Loyalty vs Capability
The Economic Ministry, historically tasked with shaping Malaysia's medium- and long-term economic policies, is central to Anwar's 'Malaysia Madani' economic reform agenda. With Rafizi Ramli no longer holding the party deputy presidency—a position widely seen as a mandate for national leadership—his future in cabinet hangs in limbo. Rafizi had earlier pledged to step down should he lose the party vote, and all signs now point to his exit after his open statement of heading off to 'living a private life'.
This leaves Anwar with full discretion to appoint a successor from within PKR, yet therein lies the conundrum: PKR's current leadership bench, based on the recent central leadership council lineup, lacks a clear economic heavyweight. The party, known more for its grassroots activism and social policy agenda, does not boast deep bench strength in fiscal or trade expertise.
One name that naturally surfaces is Nurul Izzah Anwar—Anwar's daughter and the newly-elected Deputy President of PKR after defeating Rafizi. While she is a reformist with public appeal and integrity credentials, her political strengths lie in governance and social policy rather than hard economic or trade negotiations. Her appointment to such a demanding portfolio may be seen as politically risky, both in terms of perception and experience
The Technocrat Option
Anwar, a seasoned political strategist, may thus be forced to look beyond the traditional party structure for solutions. Drawing in external technocrats or respected economists—akin to how Zafrul was brought in during the pandemic era—could provide the expertise needed while also signalling seriousness to markets and foreign investors.
Names like Khazanah alumni or current economic advisors may be floated in closed-door discussions. Such an approach, while potentially controversial among the party's grassroots, would demonstrate that national economic resilience takes precedence over internal party calculus.
Trade Ministry in Zahid's Court
Meanwhile, the Trade and Investment Ministry—which has gained renewed importance amidst global trade fragmentation, US-China decoupling, and Malaysia's aggressive FDI targets—is under Barisan Nasional's (BN) quota. As BN president, Datuk Seri Dr Ahmad Zahid Hamidi holds the prerogative to nominate a successor once Zafrul steps down.
Zahid has a deeper bench to work with. Former ministers like Datuk Seri Johari Ghani, who brings financial sector insight, and MCA's Datuk Seri Wee Ka Siong, known for his administrative acumen, are both viable candidates. Their experience could bring much-needed weight to a portfolio central to Malaysia's position in regional supply chains and global investment flows.
Additionally, there is a broader pool within UMNO and BN's technocratic circles, offering Zahid flexibility to appoint someone with both political loyalty and technocratic fluency.
Why Timing Matters
With Malaysia entering the mid-year period, widely viewed by economists as critical for recalibrating its fiscal and trade policies, timing is crucial. The government must soon decide on subsidy rationalisation, deliver major investment wins under the National Investment Aspirations (NIA), and prepare for a global economic climate that is anything but predictable.
A mini-cabinet reshuffle, long speculated, now appears not just likely, but necessary. With local and foreign observers watching Malaysia's post-pandemic recovery trajectory closely, the Prime Minister must act decisively—and wisely.
The Stakes Ahead
For Anwar, the impending cabinet decisions present a unique opportunity to strengthen his administration's reform credentials and deliver on the economic stability promised during the coalition government's formation. Appointing competent, credible figures to helm the economic and trade ministries would not only reassure investors and markets but also bolster public confidence.
Ultimately, this is about more than cabinet seats—it is about charting Malaysia's course through complex economic terrain and ensuring that the government remains not just politically intact, but economically forward-looking.
As the second half of 2025 approaches, the ball is in Anwar's court. How he plays it may very well shape his legacy. Related