Malaysia was in election mode in 2017 as many were expecting Prime Minister Najib Razak to call a snap election to take advantage of a seriously divided opposition. The upcoming election will be a win or bust battle for Najib, as he attempts to reverse consecutive slides in the number of seats won by the ruling Barisan Nasional (BN) in recent general elections, amid concerns among voters about bread and butter issues. Meanwhile, the new opposition coalition, Pakatan Harapan (PH), made former prime minister Mahathir Mohamad its chairman, to lead the challenge against BN and Najib. Mahathir's comeback provides a boost to an opposition that has been plagued by inter- and intra-party schism. Nonetheless, without the largest Malay opposition party — Parti Islam SeMalaysia (PAS) — in its fold, Pakatan has a difficult, if not impossible, task to unseat the BN. As the year came to a close, Najib solidified his grip both on his party, the United Malays National Organisation (UMNO), as well on the administration, leading to optimism within the party about the upcoming election. However, the UMNO leader kept the whole nation guessing about the election date up to the year-end. The embattled premier looks set to stretch the current parliament close to its full five-year term, which expires on 24 June 2018. When finally called, the election will be one of the country's fiercest ever political battles, pitting Najib against his former mentor, Mahathir.

Despite the intense power struggle, Malaysia's economy was on a strong growth trajectory in 2017. The unexpected growth was driven by strong domestic demand and strengthening exports. Another positive trend in Malaysia's economy in 2017 was the strengthening of the ringgit, which had been undervalued for quite some time. However, critics argued that the solid economic numbers did not reflect the reality on the ground, as many Malaysians, especially the lower income group, were struggling to cope with the rising cost of living. Another alarming trend in the Malaysian economy was the government's spiralling debt burden, caused by an exponential increase in operating expenditures.

On the diplomatic front, Prime Minister Najib Razak faced mounting domestic criticism for being too pro-China, consequently undermining Malaysia's sovereignty and its status as a middle power.