Why Did Malaysia’s Prime Minister Just Resign?

Here is today’s Foreign Policy brief: Malaysia’s prime minister unexpectedly steps down—but remains interim leader, stocks fall sharply on fears of coronavirus pandemic, and dozens are hurt in Germany after a man drove into a carnival parade.

If you would like to receive Morning Brief in your inbox every weekday, please sign up here.

Malaysian Prime Minister Mahathir Mohamad unexpectedly resigned on Monday, upending the country’s politics. In coalition with his longtime rival Anwar Ibrahim, Mahathir won the 2018 election in a surprise victory over the ruling party—to which both politicians once belonged. Their coalition included a pre-election agreement that Anwar, who is 72 years old, would eventually take over for Mahathir, 94. That now appears to be off the table.

Mahathir did not explain his decision to step down, but it followed a weekend of meetings between some members of his coalition and the opposition about forming a new government. (On Monday, Mahathir’s party also quit the coalition.) Mahathir and Anwar had reportedly disagreed over delays to the plan for Anwar to take power. At the request of Malaysia’s king, Mahathir has agreed to serve as interim prime minister until another leader can be named.

What’s next? There is no limit to how long someone can serve as interim prime minister, and Mahathir will be allowed to appoint cabinet positions. It’s likely that Mahathir, who was also prime minister from 1981 to 2003, doesn’t intend give up his leadership at all, the New York Times reports. Several political factions in Malaysia have voiced support for him remaining prime minister, but he might have a short window to show he can form a government.

Economic effects. Malaysia’s economic growth is already suffering from the coronavirus outbreak, something that could be compounded by political uncertainty. The Malaysian ringgit fell to a six-month low on the news, and the stock market index fell to its lowest level in eight years. Mahathir was already expected to announce a stimulus package in response to the virus on Thursday.

Stocks fall as coronavirus spreads. The Dow Jones Industrial Average fell by more than 1,000 points on Monday—its biggest drop in over two years—on the news that the coronavirus that originated in Wuhan, China, could become a global pandemic. The World Health Organization (WHO) announced on Monday that while it hasn’t reached that level yet, it’s highly possible—an opinion increasingly shared by epidemiologists amid outbreaks in South Korea, Iran, and Italy. If the coronavirus does become 2020’s biggest story, we should be prepared for travel restrictions, shortages, and systematic failure, FP’s James Palmer writes.

The death toll from the virus in Italy has reached seven, with 220 confirmed cases so far—all in the north, where authorities have locked down towns and closed schools. Markets are already reacting on the fear that Europe could be disrupted, as China has been. China’s management of the crisis has been widely criticized, but the West might also have issues handling the virus—particularly if countries don’t work together, Melissa Chan and Ethan Guillén write in FP.

German man plows car into parade, dozens hurt. A man drove his car into a carnival parade in the German town of Volkmarsen on Monday, injuring at least 30 people—a third of them children. Police arrested the suspect for attempted homicide, but the motive remains unclear. “It can be assumed that it was intentional,” a police spokesperson said at the scene. Germany is already on edge: The incident comes days after a far-right terror attack in which a man shot and killed nine people outside of Frankfurt. Germany’s leaders are struggling to counter the recent rise in right-wing extremist violence.

U.N.-backed Libya talks falling apart. Lawmakers from parts of eastern Libya controlled by Gen. Khalifa Haftar have said they will not participate in U.N.-brokered peace talks with allies of the internationally recognized government set to begin on Wednesday in Geneva. The move deals another blow to the United Nations’ effort to call a cease-fire in Libya after a months-long offensive by Haftar’s Libyan National Army to seize Tripoli, the capital. The talks will still go ahead, though the U.N. has not commented on the participation of either side.

Diversity in the U.S. State Department. A not-yet-released study from an independent federal watchdog finds that the U.S. State Department’s efforts to increase diversity in its ranks have fallen short—and in some cases caused a decline in the percentage of women and minorities employed there. The study appears to directly contradict statements from senior officials and is likely to increase congressional pressure on the State Department, FP’s Robbie Gramer reports.

Macron’s war on Islamism. Last week, French President Emmanuel Macron delivered a landmark speech to launch his government’s strategy against political Islam. France’s concerns about Islamism go well beyond terrorism, extending to nonviolent Islamism. The shift suggests that these concerns are no longer being expressed exclusively by those on the right of the political spectrum, Lorenzo Vidino writes in FP.

The U.S. presence in West Africa. Violent extremist attacks in the Sahel have skyrocketed in the last 18 months, with around 800 attacks. Despite the growing violence, the United States is mulling withdrawing some of its 1,000 troops in West Africa. That has raised concerns about the region becoming the next hotbed for violent extremism, FP’s Lara Seligman reports from Nouakchott, Mauritania.

A sandstorm of rare intensity is wreaking havoc in the Canary Islands, where flights were grounded, traffic disrupted, and schools closed on Monday. Regional President Ángel Víctor Torres said that the storm—known as a calima—was the worst to hit the Spanish islands in 40 years. The red sand traveled from the Sahara over the Atlantic Ocean on a burst of warm wind. The sandstorm has raised concerns about wildfires, particularly on Gran Canaria.

That’s it for today.

For more from FP, visit foreignpolicy.com, subscribe here, or sign up for our other newsletters. Send your tips, comments, questions, or corrections to morningbrief@foreignpolicy.com.