Asia elections

monitor 2024
Incumbents have the upper
hand in the region
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ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

Incumbents have the upper hand in the region

• Next year will bring a number of major elections around the world, including in Asia, with nine
national elections due to be held in the region. Democracies with a combined population of 2.2bn
and an aggregate nominal GDP of US$8.9trn—representing approximately a half and a quarter of
the respective totals for Asia—are due to go to the polls.

• While EIU associates elections with a rise in political risk and uncertainty, we anticipate that
incumbents will remain in power across the majority of next year’s elections. While anti-
establishment and populist sentiment is shaping election outcomes in many parts of the world, it is
less apparent as a political force in Asia. The relatively bright economic prospects for the region are a
contributing factor.

• The pro-incumbency trend also highlights other factors, however, including weak democratic norms.
In many of Asia’s elections next year, opposition parties face high hurdles to gaining power, owing to
formal and informal curtailment of their activities and functioning. This risks weighing on long-term
institutional strength, even if it delivers continuity and stability in the near term.

Asia's year of elections: predictions for 2024

Pakistan Mongolia

Social unrest risks if Mining focus moving from coal

military inteference to critical minerals
is too great
India South Korea

Size of BJP's majority will influence Third parties exerting greater

its policy ambition influence on policy

Taiwan

Bangladesh Lai's victory to cause some volatility in

China ties

Indonesia
Trade sanction risk if election is not
judged free and fair
Jokowi begins to build his own
Maldives political dynasty

"India out" campaign and a pivot

to China
Forecast confidence
Sri Lanka
Type of election Very low Very high
Legislative Domestic policy change
Presidential Renegotiation of IMF package to Very little Very significant
Forecast change upset Sri Lanka's recovery
International policy change
in power
Very little Very significant
Source: EIU.

1 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

Modi and BJP are set to begin a second decade in power

in India
• India will hold an election to the Lok Sabha (the lower house of parliament) in multiple phases over
April-May 2024. We expect the incumbent coalition, led by the Bharatiya Janata Party (BJP), to win
the election comfortably, ensuring continuity in government and policy. Despite having already been
in power for a decade, the BJP continues to benefit from three main factors: a high popularity rating
for the prime minister, c; the delivery of reforms to intended beneficiaries; and a perceived stronger
global positioning of India (which will appeal to the urban electorate).

• The new opposition alliance, dubbed the Indian National Developmental Inclusive Alliance (INDIA),
is led by the main nationwide opposition, the Indian National Congress. The alliance of 28 parties
is held together weakly, however, and this will limit its appeal to an electorate that is sceptical of
multi-party government. While its chances of unseating the BJP are very low, we still expect INDIA
to secure enough seats to reduce the BJP’s large majority modestly.

• We do not expect any “big bang” reforms under a returning BJP administration led by Mr Modi,
which will continue to focus on issues such as land acquisition, labour market initiatives and
agriculture reforms. Existing initiatives such as boosting the manufacturing sector, diversifying and
indigenising defence equipment and strengthening infrastructure will continue. In foreign relations,
India will pursue stronger relations with the US and its allies to strengthen capabilities in areas
such as defence, critical technologies (including semiconductors) and funding for green transition
projects like the National Green Hydrogen Mission. Relations with neighbouring China and Pakistan
will remain hostile, while India will further pursue its mission to be a leader of emerging economies
through forums such as BRICS+ and the G20.

2 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

Political continuity will contribute to anticipated improvements in business environment

EIU business environment rating (10=high)

2014-18 2019-23 2024-28
3 4 5 6 7 8
Overall position
Labour market
Macroeconomic environment
Market opportunities
Financing
Foreign trade and exchange controls
Infrastructure
Policy environment for foreign investment
Policy towards private enterprise
Political environment
Tax regime

Inward FDI flows (US$ bn)

Actual EIU forecast
80

70

60

50

40

30

2018 19 20 21 22 23 24 25 26 27
Sources: EIU; Reserve Bank of India.

Jokowi’s influence in Indonesian politics will extend

beyond his tenure
• Indonesia’s presidential and legislative elections will be held concurrently in February. We expect a
run-off presidential election in mid-2024, as no candidate will be able to secure a simple majority in
the first round. With implicit support from the influential incumbent president, Joko Widodo (known
as Jokowi), we expect Prabowo Subianto, the chairman of the Great Indonesia Movement Party
(Gerindra) and the incumbent defence minister, to win eventually. He is supported by his running
mate, Gibran Rakabuming Raka, the governor of Surakarta and the eldest son of Jokowi.

• Mr Prabowo’s bid will be assisted by Jokowi’s widespread popularity, earning him support even
in provinces where Gerindra fares relatively poorly. He will be compelled to ensure that Jokowi-
era policies are retained, particularly a flagship capital relocation project and several other major
infrastructure schemes including the Jakarta-Bandung high-speed railway. Resource nationalism

3 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

will remain the norm as the government continues to encourage investment in downstream mineral
processing.

• The incumbent ruling party, the Indonesian Democratic Party—Struggle (PDI-P) will remain a
formidable force, despite its candidate losing the presidential election. It will probably maintain its
position as the single largest party in the House of People’s Representatives (the legislature). This will
ensure that it is included in the coalition that Mr Prabowo is likely to form. Jokowi’s administration
has been characterised by this big-tent approach, which has supported political stability.

The next phase of Indonesia's high-speed railway will extend its range more than five-fold

Java Sea
INDONESIA
Sunda
Strait Jakarta
Banten
Cirebon
West Semarang
Java
Bandung
Central Java Surabaya
Mad ur a St r ai t

East Java
Completed Special Region of Yogyakarta
Bali
Planned
Indian Ocean
150 km
Source: EIU.

Victory for the DPP’s Lai will generate volatility in ties

between Taiwan and China
• We expect Lai Ching-te, the Taiwanese vice-president and candidate of the ruling Democratic
Progressive Party (DPP), to win the presidency in the January 2024 election. This will lead to a period
of volatility in Taiwan’s ties with China, given Mr
Lai’s past pro-independence remarks.
Taiwan’s opposition vote remains split,
• Mr Lai’s expected victory will partially but suggests a close race
(support for potential candidates; %)
reflect the breakdown in co-operation
Lai Ching-te Hou Yu-ih Ko Wen-je
between Taiwan’s main opposition party, the (DPP) (KMT) (TPP)
50
Kuomintang (KMT), and the independent (but
KMT-leaning) Taiwan People’s Party (TPP). 40
These factors will split the opposition vote to 30
the DPP’s advantage. We expect a tight race,
20
however, with Mr Lai receiving a plurality
(rather than a majority) of the Taiwanese 10

presidential vote. 0

• We nevertheless expect opposition forces to

Mar Apr May Jun Jul Aug Sep Oct Nov
2023
*Polling data for November represent values published on Nov 24th.
gain control of the legislature, given public Sources: My-Formosa; EIU.

4 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

disenchantment with the DPP’s domestic record. A KMT-TPP legislative coalition will set roadblocks
for Mr Lai and his efforts to make progress on issues such as social housing supply, strengthening
manufacturing competitiveness outside high-tech sectors, promoting stronger wage growth for
junior employees and expanding childcare support.

Third parties in South Korea Minjoo (the main liberal party) retains a lead
will exert more influence in in opinion polls
a polarised political scene % of votes

• Our forecast assumes that the liberal Minjoo Main conservative party Main liberal party
50
Party will retain a majority in parliament, albeit 40
with a reduced seat share, in South Korea’s
30
legislative election in April. Public support for
20
Minjoo has waned because of its lacklustre
record in government and legal troubles 10

involving its senior leaders. By contrast, 0

a resilient labour market and improving 2000 04 08 12 16 20

economic conditions ahead of the legislative

Number of seats in parliament
election will bolster the conservative People Main conservative party Main liberal party
200
Power Party (PPP), with which the president,
Yoon Suk-yeol, is associated. Against a 150
backdrop of increasingly polarised politics, we
100
still do not expect the PPP to gain enough votes
to secure an outright majority. 50

• The conservative-led government will cite an 0

increased number of parliamentary seats as 2000 04 08 12 16 20
evidence of support for its domestic economic
policy agenda, which involves lowering the tax Opinion polls of public approval ratings
Main conservative party Main liberal party
burden for businesses to encourage private- 55
sector investment and employment, and a 50
45
return to fiscal prudence.
40
• The legislative election is likely to show a 35

rise in support for third parties, reflecting 30

25
dissatisfaction with prolonged confrontational
politics between Minjoo and PPP. Although no Sep Oct Nov
2023
emerging parties will garner sufficient votes to Sources: Realmeter; EIU.
challenge the national dominance of the two
main parties, they will have a greater influence on policy.

5 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

A probably acrimonious election in Bangladesh points to

trade risks
• We anticipate that populist measures and the maintenance of food and energy subsidies, along with
a strong rural support base, will underpin the return to power of the ruling Awami League (AL) for a
fourth consecutive term following Bangladesh’s general election in January. This will include the re-
election as prime minister of Sheikh Hasina Wajed, the world’s longest serving female leader.

• Violent protests are likely ahead of the election, with the main opposition Bangladesh Nationalist
Party (BNP) insisting on the installation of a caretaker government ahead of the polls. The
government’s strong control over the security forces will ensure the maintenance of basic law and
order, but the AL will be keen to ensure that the BNP still participates in the election, to ensure that
the result is seen as credible.

• A flawed election could lead to strains in Bangladesh’s relationship with the US and the EU. This
poses economic and trade risks, given that Bangladesh’s economy is reliant on ready-made garment
exports, with the US and the EU acting as key export markets. Troubled relations with Western
powers could allow China’s economic influence to grow in Bangladesh; China is already Bangladesh’s
key import partner and arms supplier, and is financing several infrastructure mega-projects.

Major infrastructure projects in Bangladesh that are funded by Chinese firms

Project Chinese investment in US$ bn Status and planned completion date
Padma multipurpose bridge 3.7 Operational since June 2022
Karnaphuli River tunnel 0.7 Operational since October 2023
Dhaka Elevated Expressway 1.0 June 2024
Bangladesh-China Friendship Bridge 0.1 Operational since September 2022
Dhaka-Sylhet four-lane highway 1.9 December 2026
Payra 1,320-MW power plant 1.9 Operational since March 2022
Source: EIU.

Pakistan’s powerful military will influence the country’s

election
• Pakistan will hold an election for the National Assembly (the lower house of parliament) in February.
Our baseline forecast is for the ruling coalition led by the Pakistan Muslim League (Nawaz), or PML
(N), to secure a majority of seats, assisted by its ties with Pakistan’s powerful military. Although the
opposition, led by the Pakistan Tehreek-e-Insaf party of the former prime minister, Imran Khan,
commands significant popularity despite Mr Khan’s incarceration, it has hostile relations with the
army. Social unrest could consequently ensue, depending on how the polls are perceived to have
been handled.

6 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

• The focus of the next government, irrespective

Pakistan’s external position will remain
of which party wins, will be the implementation
precarious
of IMF-mandated reforms in order to secure (US$ bn)
continued access to funds. These will include
Current-account balance Foreign exchange reserves
the privatisation of loss-making enterprises 0 28
in sectors including energy, aviation and -2 24
shipping, and the reduction of the leverage -4 20
levels affecting the domestic energy industry. -6 16
The government will focus on securing another
-8 12
extended fund facility once the current IMF
-10 8
package concludes in March 2024, to manage
-12 4
persistent balance-of-payments strains.
-14 0
• Pakistan will continue to rely on China, which 2020 21 22 23 24* 25* 26* 27* 28*
*EIU forecasts from 2024 onwards.
is the former’s major trade and investment Sources: Pakistan Bureau of Statistics; EIU.
partner and vital to the development of
its infrastructure. However, given debt
sustainability concerns, China will pursue a measured approach towards fresh investment in
Pakistan, focusing only on projects with promise and strategic importance. Pakistan will continue to
seek stronger links with Gulf nations, while relations with the US will remain cool.

Left-wing government in Sri Lanka would place IMF

programme in doubt
• A presidential election is due in Sri Lanka by September, with parliamentary polls likely alongside.
The leftist opposition alliance, the National People’s Party/Janatha Vimukthi Peramuna (NPP/
JVP), appears set to do well in both, reflecting dissatisfaction with the country’s main parties, the

Electricity tariffs have soared after the implementation of the IMF programme
(Monthly electricity bill; SLRs)
Oct 2023 approved tariffs Feb 2023 approved tariffs 2022 approved tariffs 2014 initial tariffs
14,000

12,000

10,000

8,000

6,000

4,000

2,000

0
10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180 190 200
Units consumed per month (kWh)
Sources: Public Utilities Commission of Sri Lanka; EIU.

7 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

country’s economic collapse in 2022 and the terms of a consequent IMF programme. The NPP/JVP’s
Anura Kumara Dissanayake is the front-runner to be president.

• There are significant risks to our forecast. The current president, Ranil Wickremesinghe, would like
to continue in his role and could contemplate a constitutional amendment to delay the election in
order to give the IMF programme a longer period to deliver results. Mr Wickremesinghe, who came
to power in the political crisis of 2022 and has not been popularly elected, has struggled to move
beyond his association with the disgraced Rajapaksa family.

• The NPP/JVP has openly voiced its willingness to renegotiate terms under Sri Lanka’s IMF
programme and is generally committed to greater public ownership and easing the burden of high
electricity tariffs on the poor. Its establishment as the governing party would raise significant issues
over the viability of IMF support for Sri Lanka and the progress of its economic recovery.

Boosting non-coal exports is the policy priority in

Mongolia
• We forecast that the ruling Mongolia People’s Party (MPP) will retain a majority in the parliamentary
election slated for June, although its margin will probably be smaller following an increase in the
number of parliamentary seats.

• The political dominance of the MPP (in both the executive and legislative branches) will ensure
policy continuity, marked by an emphasis on expanding infrastructure investment and boosting
mining exports (especially non-coal and critical minerals).

Mongolia is stepping up construction of railways and dry ports

RUSSIA

Altanbulag
Tsagaannuur

Choibalsan
Ulaanbaatar

MONGOLIA
Bichigt

Sainshand

CHINA Zamyn-Uud

Existing railway Existing dry port CHINA

Planned railway (prioritised)
Planned dry port
Planned railway (others)
500 km
Source: EIU.

8 © The Economist Intelligence Unit Limited 2023

ASIA ELECTIONS MONITOR 2024
INCUMBENTS HAVE THE UPPER HAND IN THE REGION

• The fate of the incumbent prime minister, Luvsannamsrain Oyun-Erdene, is less certain, given
protests against his administration in relation to corruption in recent years. Our baseline assumption
is that he will remain in the role after the election, with Amarbayasgalan Dashzegve, the secretary-
general of the MPP, a potential alternative.

Political shifts are moving fiscal consolidation off the

agenda in the Maldives
• We believe that the opposition legislative coalition led by the Progressive Party of Maldives (PPM)
and the People’s National Congress will form a majority in parliament following the election due
in 2024. This will smooth policymaking for the president, Mohamed Muizzu, who won the 2023
presidential contest for the coalition.

• The current ruling Maldivian Democratic Party (MDP), which will struggle against anti-incumbency
sentiment, will form the main opposition, while
The Democrats, a breakaway faction of the
MDP, will probably expand their presence in Continued focus on welfare spending will
imply slow fiscal consolidation
parliament. The Democrats will benefit from
(budget balance; % of GDP)
increased support from the electorate following
Actual EIU forecast
a strong performance in the 2023 presidential 0

election. -5

• We expect Mr Muizzu’s administration to lack -10

the appetite for necessary fiscal consolidation -15
measures and to rely instead on welfare
-20
spending to ensure high public approval ratings.
-25
Some risks to political stability will remain,
as Abdulla Yameen Abdul Gayoom, a former -30
2018 19 20 21 22 23 24 25
president (2013-18) and PPM leader, is unlikely Source: EIU.
to be content playing a secondary role.

9 © The Economist Intelligence Unit Limited 2023

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