As the government of Prime Minister Najib Razak gears up for fresh general elections due before June 2013, Malaysia can look back on over five decades of progress since independence in 1957. The country has since moved on from its early years of nation-building in the wake of colonial rule and the Cold War conflict to an economy and polity very much based at the forefront of modern Asia. Now, Malaysia can look forward to developed nation status by 2020, with the decade ahead likely to see a renewed dynamism as further development plans take hold.

Indeed, with the third-highest GDP per capita in the Association of South-east Asian Nations (ASEAN) after Singapore and Brunei Darussalam, Malaysia also has one of the most sophisticated economies, most advanced infrastructure networks and most stable political cultures in the region. As a sign of this political maturity, both the government and opposition are based on coalitions that seek to weld Malaysia’s diverse ethnic and religious constituents into united forces. Consensus and cooperation – along with a pro-business and pro-foreign-investment stance – are widely shared values across the political spectrum. Indeed, this focus on diversity and coalition building are factors that give Malaysia some of its unique strengths.

MONARCHY & FEDERATION: Modern Malaysia consists of two main geographical regions – the western, peninsula-based part – often referred to by its Bahasa Malay title of Semenanjung Malaysia – and the eastern part, situated on the island of Borneo. Each of these regions is divided into states, with two of these in East Malaysia – Sarawak and Sabah – and 11 in Peninsular Malaysia. In addition, the east also contains the federal territory of Labuan, while the west has two federal territories, the capital and largest Malaysian city, Kuala Lumpur, and the administrative capital, Putrajaya.

Federal territories are administered differently from states in that they are governed directly by the federal government via the Ministry for the Federal Territories, rather than by local parliaments. All the states have there own unicameral parliaments, or legislative assemblies, with elected governments led by chief ministers (CMs). In addition, nine of the states – all of them on the peninsula – have hereditary monarchs as head of state, with seven of these entitled sultan, one entitled raja (the state of Perlis) and one entitled yamtuan besar (the state of Negeri Sembalan, which has a monarch elected by its four territorial chiefs, or undang).

In a unique constitutional facility, these nine monarchs convene a Conference of Rulers to elect the king, or yang di-pertuan agong, to rule as Malaysian head of state for a five-year term. In practice, this has become a rotational placement, with the post currently held by the sultan of Kedah, Abdul Halim – the first to hold the office twice, after his installation on April 11, 2012. In due course, he should be succeeded by the sultan of Kelantan, as the rotation follows a strict order of seniority amongst the nine states.

The four states without monarchs are Sabah and Sarawak in the east and Penang and Malacca in the west.

Instead, these have a governor as head of state, with the governor appointed for four-year renewable terms by the king, on the advice of the prime minister and after consultation with the state government. The governor, or yang di-pertua negeri, has a largely ceremonial role, with executive power in each state residing largely with the CM as head of the state government.

The CM is normally the leader of the largest party in the state parliament, the Dewan Undangan Negeri, whose members are elected for five-year terms from single-member constituencies.

STATE POWERS: There are also some differences in state powers between the peninsular and eastern Malaysian states, largely due to their different histories. While the states of the peninsula joined together and declared independence from the British Empire in 1957, Sabah and Sarawak did not join with them until 1963. Both had previously been administered separately by the British, the former as British North Borneo, while the latter had been independent of the UK, although ruled by a British “white rajah” until becoming a colony after the Second Word War. This different history meant that Sabah and Sarawak joined what then became the Malaysian Federation, while retaining their local rights over immigration, native laws, hydroelectricity, family law and land.

The relationship of powers between state and federal authorities generally breaks into three parts, or lists. The first, federal list grants exclusive power to the federal parliament in all matters concerning areas such as defence, foreign policy, education, finance and trade. The second state list grants exclusive powers to the local state legislatures. These powers are usually in areas such as local application of sharia law and courts, local public works, land use and holidays. The third, “concurrent” list is for joint federal and state powers, in areas such as water and utilities. In the event of overlapping jurisdiction, federal rule applies.

There is no elected local government tier below the state parliament. Elections for municipal councils, or majlis, were suspended in 1964, with some debate about lifting this in recent times. Until this occurs, majlis councillors, called mayors (for urban areas) and presidents (for rural areas), are appointed by the state government. These local bodies have responsibility for granting trading licences and permits, collecting local assessment tax and implementing local by-laws.

HEAD OF STATE: The yang di-pertuan agong is the head of a state with a basic federal structure and a strong centre. Malaysia is, however, one nation with two parts, separated by some 800 km of the lower South China Sea, as well as by different histories. As monarch, the yang di-pertuan is thus an important unifying force, in addition to having a number of other important roles.

First, he is head of Islam in the three federal states and the four states without monarchs (in those with monarchs, the local monarch takes on this role). He is also commander-in-chief of the Malaysian armed forces and appoints the head of each branch of the services.

He has power of appointment of the prime minister, deputy prime minister, cabinet ministers and chief cabinet secretary, although as a constitutional monarch, in effect the prime minister is appointed by the largest party or coalition in parliament, while the other posts are them appointed by the prime minister, and subsequently approved by the king. The yang di-pertuan agong also appoints, on the prime minister’s advice, the chief justice and chief judges of Malaya, Sarawak and Sabah; various commissions; and 44 members of the Dewan Negara, the upper house of parliament.

EXECUTIVE POWERS: The main executive force in Malaysia is thus the government, led by the prime minister. He or she is the leader of the largest grouping in the lower house of parliament, the Dewan Rakyat.

The current prime minister is the sixth to hold the office since 1957, having succeeded Abdullah Badawi in April 2009. Badawi in turn had succeeded Mahathir Mohamad, the country’s longest-serving prime minister, who was in office from 1981 to 2003. Prime Minister Najib is also the son of the second prime minister of Malaysia, Abdul Razak, and a nephew of the third, Hussein Onn. The first prime minister was Abdul Rahman, in office from 1957 to 1970.

The prime minister chooses the cabinet, which is customarily approved by the king. The cabinet consists of heads of ministries, as well as the deputy prime minister, chief cabinet secretary and six ministers of the Prime Minister’s Department (also known as the Prime Minister’s Office, or PMO). The PMO is a powerful office, with its six ministerial posts including heads of the Economic Planning Unit, Performance Management and Delivery Unit, Islamic Affairs, the Malaysian Anti-Corruption Commission, Election Commission of Malaysia and the Judicial Appointments Commission.

PARLIAMENT: The government has the power to submit legislation to the Dewan Rakyat for debate and voting. The lower house has 222 members, elected from single-member constituencies on a first-past-the-post system for five-year terms. All citizens over 21 years of age can vote, though it is not obligatory.

Since independence, the largest party in parliament after all 12 general elections held has been the United Malays National Organisation. This joined with the Malaysian Chinese Association and Malaysian Indian Congress to form the Alliance, a coalition that ruled Malaysia until 1973, when it reorganised as the Barisan Nasional (National Front, or BN). The BN has formed every government since its foundation, and as of July 2012 held 135 of 222 seats in the Dewan Rakyat. The BN has also expanded from the Alliance to include coalition partners such as the Malaysian People’s Movement Party, United Traditional Bumiputera Party – the largest party in Sarawak – the United Sabah Party and United Pasokmomogun Kadazandusun Murut Organisation, also from Sabah. All have seats in the cabinet.

The parliamentary opposition is also a coalition, the Pakatan Rakyat (People’s Alliance, or PR). This is composed of three parties – the People’s Justice Party (PKR), the ethnic Chinese-based Democratic Action Party (DAP) and the Pan-Malaysian Islamic Party (PAS). As of July 2012, they had 77 seats among them, 23 belonging to PAS, 28 to DAP and the remainder to PKR.

The basis for many parties in Malaysia is an ethnic one, with this also often having religious connotations. Indeed, by law all ethnic Malays are considered Muslim and subject to the sharia courts’ rule as well as the federal courts. Ethnic Malays and other indigenous peoples are also known as bumiputeras, an identity giving them additional economic advantages, as successive BN governments have sought to use positive discrimination policies to advance bumiputera welfare.

The last general election was held in 2008, with this accompanied by elections for state parliaments everywhere except Sarawak, where the last state election was held in 2011 and won by the BN. The BN has a majority in both East Malaysian states and all Peninsular Malaysian states except Selangor, Penang, Kedah and Kelantan, with the state of Perak, won by the PR in 2008, subsequently switching back to BN control. A general election must be held before June 27, 2013.

In addition to the lower house, Malaysia’s upper house, the Dewan Negara, or Senate, has 70 members, serving three-year terms for a maximum of two terms. Of these, 44 are appointed by the king, on the prime minister’s advice, while the rest are elected by the state parliaments – two per state. Given this arrangement, the opposition held only eight seats in the Senate as of 2011, with seven vacant and the rest held by the BN.

The Senate must also approve legislation before it can be submitted for the king’s final approval – and thus passage into law – yet this is now largely a power of delay. A bill voted down by the Senate is held up by a maximum of one year before going to the king. If the king does not grant assent at that stage, then the bill returns once more to both houses. If it is then re-presented to the king, it is automatically passed and enacted when published in the government gazette. The Senate may also initiate its own legislation, provided this does not concern financial or fiscal matters.

JUDICIAL MATTERS: The apex of the Malaysian judicial system, which is largely based on British law, is the Federal Court, headed by the chief justice of Malaysia, who is appointed by the king on the advice of the prime minister and Conference of Rulers. The current chief justice is Arifin Zakaria, who has held office since 2011. Beneath this is the Court of Appeal, then two High Courts – one for Peninsular Malaysia and one for Sabah and Sarawak. Beneath these are the subordinate courts, which comprise the sessions’ courts and magistrates’ courts. Sabah and Sarawak also have Native Courts, while the peninsula has Penghulu Courts, all of which operate according to indigenous customary law. In parallel, there is also a system of sharia courts, which have jurisdiction over the country’s Muslim citizens when it comes to lesser offences, usually involving the family, religious practices and observances.

OUTLOOK: The prospect of general elections by June 2013 means the immediate political future is likely to be dominated by hustings, as the BN and PR square off to see who will dominate the new parliament. Yet whatever the outcome, the political system looks stable, with a pro-business, pro-investment agenda.

It is also likely to continue moving towards further integration on the economic front with its ASEAN partners, although it has expressed some reservations about wider schemes, such as the Trans-Pacific Partnership. In the period ahead, foreign affairs may well take a more prominent role, as the country tries to broaden its international influence. As a trading nation, Malaysia seems well placed to reach a greater global role in the years ahead, as its economy at home continues to underscore robust growth in its influence abroad.