The Malaysian economy was badly hit by the Asian financial crisis in 1997 when Finance MinisterAnwar Ibrahim, concurrently serving as Deputy Prime Minister, implemented several economic reforms and austerity measures in response. He instituted an austerity package that cut government spending by 18%, cut ministerial salaries, and deferred major projects. This was despite it being a cornerstone of the government's development strategy, and the reforms were thus seen as challenging the administration's policies. The situation was exacerbated when he introduced controversial amendments to the Prevention of Corruption Act that sought to increase the powers of the Anti-Corruption Agency (ACA).
Prime Minister Mahathir Mohamad strongly disagreed with the measures, and towards the end of the 1990s, their relationship began to deteriorate, triggered by their conflicting views on governance.[1] Eventually, Mahathir dismissed Anwar from his cabinet positions on 2 September 1998 before expelling him from UMNO the day after. This incident eventually led to Anwar's subsequent arrest and detention without trial on September 20 on what many believed to be politically motivated allegations of sexual misconduct and corruption. While he was in police custody, Anwar was beaten by the then Inspector-General of Police, Abdul Rahim Mohd Noor. The incident and the circumstances in which it occurred led to public outcry in what became known as the Reformasi movement.
Early years
During the autumn of 1998 and early 1999, as waves of street protests and civil society organising swept Malaysia, new civic groups coalesced around demands for judicial independence, an end to cronyism, and political reform. These developments created the preconditions for a new political vehicle to channel the Reformasi movement into electoral politics.[2][3] At that time, two people's movements were established:
Suara Rakyat Malaysia (SUARAM), in collaboration with political parties such as PAS, PRM, and DAP, along with other human rights organisations, also established a multiracial movement known as Gagasan Demokrasi Rakyat (GAGASAN).
The establishment of GERAK and GAGASAN was not solely to support the release of Anwar Ibrahim, but also draw attention to alleged injustices committed by the Malaysian government at the time, led by Prime Minister Mahathir Mohamad.[4]
After Anwar's arrest, his wife, Wan Azizah Wan Ismail, decided to build upon the momentum of Reformasi by convening civil society actors and activists to form the Social Justice Movement (Pergerakan Keadilan Sosial, ADIL) on 10 December 1998. Initially planned to serve as a non-governmental organisation vehicle for the Reformasi movement,[5] ADIL faced obstacles to formal party registration from the Registrar of Societies (RoS), which was under the jurisdiction of the Ministry of Home Affairs whose minister happened to be Mahathir Mohamad.[6]
Due to difficulties in becoming a registered political party, Reformasi organisers instead made the decision to take over an existing minor party, the Malaysian Islamic Community Alliance (Ikatan Masyarakat Islam Malaysia, IKATAN), and reestablished it as the National Justice Party (Parti Keadilan Nasional, KeADILan) on 4 April 1999.[7] The new party leadership installed Wan Azizah as its inaugural president and positioned the organisation as a multi-ethnic, reformist alternative to the ruling Barisan Nasional (BN).[8] The timing allowed the party to contest the 1999 general election.
Arrests
Between 27 and 30 September 1999, seven activists, including KeADILan leaders; Vice President Tian Chua, N. Gobalakrishnan, Youth Chief Mohamad Ezam Mohd Nor, Mohamed Azmin Ali, Fairus Izuddin and Badrul Amin Baharun; were arrested and consequently barred from contesting the election. Further arrests were made on 10 April 2001, and those arrested were later charged and imprisoned under the Internal Security Act. They became known as the Reformasi 10.
1999 general election
The National Justice Party entered electoral politics immediately, contesting the 1999 general election. The party also joined with other opposition parties in the Barisan Alternatif (BA) coalition to present a united front against Barisan Nasional in multiple constituencies. In the election, KeADILan won several parliamentary seats, most notably in Permatang Pauh, the former seat of Anwar Ibrahim where his wife, Wan Azizah, was elected. The 1999 results consolidated KeADILan's position as a new centre of opposition politics despite the ruling coalition retaining overall parliamentary dominance.[9][10]
Merger into Parti Keadilan Rakyat
After the 1999 general election, there was a growing consensus that KeADILan and the Malaysian People's Party (PRM) needed to merge based on their shared commitment to Reformasi and opposition to injustice and abuse of power. Following the 1999–2002 period of consolidation, negotiations were held for a potential merger between KeADILan and PRM. Thus, on 3 August 2003, the two parties formally merged to establish the People's Justice Party (PKR) in Kuala Lumpur.[11] However, approval for the merger and PKR's subsequent establishment was only granted in 2004 after the general election. The merger combined KeADILan's urban reformist base with PRM's socialist legacy, producing a broader national party structure under Wan Azizah's leadership with PRM president Syed Husin Ali serving as her deputy. Meanwhile, Anwar Ibrahim was designated as an advisor and symbolic figurehead while he served his prison sentence. The merger and the party's subsequent evolution were noted by scholars as successful in establishing PKR as a durable multi-ethnic reformist party in Malaysia's changing party system.[12]
Legacy
The National Justice Party represents the immediate institutionalisation of the Reformasi movement into party politics. Its establishment under Wan Azizah, rapid mobilisation in 1999, and the later merger to form PKR are widely regarded as key developments in Malaysia's post-1998 political realignment. The party's multi-ethnic, reformist orientation and its linkage to the broader Reformasi agenda laid the foundations for PKR's subsequent role in coalition politics and eventual participation in the federal government.
The National Justice Party (KeADILan) participated in two general elections before the Registrar of Societies (RoS) approved the name change to the People's Justice Party (PKR), namely in 1999 and 2004. In the 2004 election, candidates from the Malaysian People's Party (PRM) contested on the KeADILan ticket as the merger of the two parties had yet to be approved.
1999 Malaysian general election
In the 1999 general election, KeADILan fielded 59 candidates for parliamentary seats and 94 candidates for state assembly seats. Of these, 5 candidates were successfully elected to the Dewan Rakyat, while 4 were elected to the state assemblies, one each from Penang, Perak, Pahang, and Selangor.
In the 2004 general election, KeADILan fielded 57 candidates for parliamentary seats and 146 candidates for state assembly seats. Of these, only Wan Azizah Wan Ismail was successfully elected to the Dewan Rakyat in the traditional stronghold of Permatang Pauh, and none were successfully elected to the state assemblies.
↑Chai, James (2024). "Party of Hardship: The Evolution of Malaysia's Parti Keadilan Rakyat"(PDF). ISEAS - Yusof Ishak Institute. Retrieved 15 December 2025. 10 December 1998 ADIL was officially launched, with Wan Azizah as its first president; 4 April 1999 Parti Keadilan Nasional (PKN) was officially launched.
↑Hunt, Michael. "Crisis, Political Change, and Economic Reform"(PDF). Peterson Institute for International Economics. Retrieved 15 December 2025. Pergerakan Keadilan Sosial (ADIL) was founded in December 1998 and then the National Justice Party (Keadilan) the following April.
↑In-wŏn Hwang (2003). Personalized Politics: The Malaysian State Under Mahathir. Singapura: Institute of Southeast Asian Studies. pp.314–315. ISBN9812301852.
↑"Lim Kit Siang". Lim Kit Siang. 10 September 1999. Retrieved 11 July 2011.
↑Chai, James (2024). "Party of Hardship: The Evolution of Malaysia's Parti Keadilan Rakyat"(PDF). ISEAS-YusofIshakInstitute. Retrieved 15 December 2025. 4 April 1999 Parti Keadilan Nasional (PKN) was officially launched at the Renaissance Hotel, taking over Ikatan Masyarakat Islam Malaysia.
↑Amnesty International. "Malaysia: Human rights developments and political background, 1999". Amnesty International. Retrieved 15 December 2025. Wan Azizah called for fairer policing and transparency in 1999 as the new party sought to translate Reformasi into electoral gains.
↑Refworld. "Freedom in the World 2001 - Malaysia". Refworld. Retrieved 15 December 2025. Anwar's wife, Wan Azizah Ismail, responded by founding Keadilan (the National Justice Party), which entered into a new, opposition Alternative Front coalition.
↑Chai, James (2025). "The transformation of Malaysia's Parti Keadilan Rakyat". Cambridge University Press. Retrieved 15 December 2025. The 2003 merger created a sixty-two-member transitional supreme council and positioned Anwar as the party's life member and de facto opinion-maker.
↑Chai, James (2024). "Party of Hardship: The Evolution of Malaysia's Parti Keadilan Rakyat"(PDF). ISEAS - Yusof Ishak Institute. Retrieved 15 December 2025. After two years of painful negotiations, on 3 August 2003, Parti Keadilan Rakyat (PKR) came into being as a result of a merger between PKN and PRM.
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