PETALING JAYA: Fitch Solutions Country Risk and Industry Research has predicted that Barisan Nasional will win the general election, though there remains “significant risks” of a hung Parliament.
It said the outcome of the Melaka and Johor state elections were likely indicators that BN had regained political momentum, adding that it had the advantage of being the longest-ruling coalition in the country.
“This has benefited them both in election promises that they have more actual governing experience over the other political coalitions as well as realistic expectations that they would be able to fulfil their promises once elected,” the research arm of US credit rating agency Fitch Solutions said.
It said a Pakatan Harapan or Perikatan Nasional win was a little below 25% in probability, noting that PH has waned in momentum since its 2018 general election victory.
On the other hand, it said, PN had performed poorly at the Melaka and Johor state polls, believing for the same to be seen in GE15.
“While PH’s election promises largely have the same projected positive effects for the economy as BN’s, they have also been accused of making populist election promises that do not have long-lasting positives for consumers, such as getting rid of highway toll charges.
“The rural poor are unlikely to use highways on a regular basis and would benefit minimally from this. Instead, it is an indirect burden on the lowest income demographic as the government takes on the additional expenses should toll charges be abolished,” it said.
It expected a new BN government to lead to greater state intervention in the economy, including the reintroduction of the goods and services tax (GST) and an expansion of race-based affirmative action.
However, it said it expected BN to govern “relatively pragmatically” and to continue Putrajaya’s openness to foreign investments.
It said bringing back GST will bode well for the nation’s medium-term fiscal outlook.