Political stability will come under moderate threat during the next five years, not because of any major shift in the balance of power, but rather because of internal strife within both the governing Barisan Nasional (BN) coalition and the main opposition Pakatan Rakyat (PR) alliance. The BN, which is tightly controlled by its largest component party, the United Malays National Organisation (UMNO), is set to remain in government during the forecast period, during which there will be a general election. (The next election must be held by April 2013 but is likely to happen sooner, most likely in 2012.) Although the March 2008 general election revealed that UMNO could no longer count on the strong support of the majority of Malays, the PR still does not offer a sufficiently credible, stable alternative to the BN.

The BN's success in remaining in a position of strength will depend largely on whether it manages to keep its power base intact in Sabah and Sarawak. BN legislators from the two states, which are located on the island of Borneo, make up more than one-third of the BN's total of 137 members of parliament (MPs). The BN's Borneo power base is likely to be severely tested at the next Sarawak state election, which must be held by July 2011. Unresolved issues, such as illegal foreign immigration to Sabah, may cause the BN parties based in Borneo, or individual MPs from the island, to defect to the opposition in Malaysia's national parliament, or use the threat of defection to secure greater influence within the coalition in the run-up to the next general election.

Although voters in the rural heartland of peninsular Malaysia continue to support UMNO, there have been suggestions that the party has lost the support of a significant number of educated, liberal middle-class Malays. This shift in support may have intensified as Internet news sites and blogs have exposed government corruption and the political intrigues of individual government members. The more conservative Malays have also been voicing concerns about the government's plan to reform policies that favour bumiputera (ethnic Malays and other indigenous peoples), believing that the special rights accorded them in the constitution could be rescinded. However, the results of two by-elections in November 2010 point to a slight shift in non-Malay sentiment in favour of the BN, suggesting that the government's plans to reform bumiputera policies has increased its appeal among ethnic minorities.

UMNO's internal leadership elections, which have been postponed until 2012, could be a source of instability, particularly if an early general election is called this year and the party fails to secure a resounding victory. Under such circumstances, the credibility of the prime minister, Najib Razak, would be undermined, placing his position as president of the party-and hence his role as head of government-at risk. This in turn could halt, or even reverse, Mr Najib's programme of economic reforms. The most likely contender to become UMNO's next leader is the deputy prime minister, Muhyiddin Yassin.

The leader of the PR, Anwar Ibrahim, a former deputy prime minister, is likely to be convicted on a charge of sodomy in the coming months. Mr Anwar claims that the case against him is politically motivated. Without him, the ties that unite the disparate parties making up the PR-the reformist, multicultural Parti Keadilan Rakyat (PKR), the conservative, Islamist Parti Islam se-Malaysia and the left-of-centre, predominantly ethnic-Chinese Democratic Action Party-are likely to fray, while the process of choosing a new PR spokesman could deepen divisions within Mr Anwar's PKR as well as between the opposition coalition's member parties.