Malaysia's opposition threatened on Saturday to hand the ruling coalition its biggest upset in 40 years by winning the northern island state of Penang, sources on both sides of politics said.
"It's bad. They have lost Penang," a source close to Prime Minister Abdullah Ahmad Badawi told Reuters just two and a half hours after polling booths closed at 0900 GMT. "It's a perfect storm," he added. "Big guns are falling all over the place."
A lawmaker from the main opposition Democratic Action Party (DAP) said unofficial figures showed the opposition was leading in 17 of the 40 state assembly seats in Penang, a manufacturing hub that is home to a number of multinational electronics firms. Local independent news Web site malaysiakini said it was leading in six more seats.
The ruling coalition is almost certain to get a majority and form the government at the federal level, but the results could spell trouble for the prime minister's leadership and race ties in the multi-racial Southeast Asian nation.
"What has happened is there were aspects of unhappiness everywhere -- Indians, Chinese and Malays," the source said. "All these storms came together and there's this massive swing."
"The only thing you can say now is that there will be a simple majority," he added. "It will be the biggest setback since 1969."
Race relations have become a big issue in a country that has long been proud of the racial harmony among its majority Muslim Malays, and ethnic Chinese and Indian minorities.
Opposition rallies had drawn big crowds, especially Chinese and Indian voters unhappy with Abdullah's Malay-dominated coalition.
Chinese and Indians account for a third of the population of 26 million and some complain the government discriminates in favour of Malays, when it comes to education, jobs, financial assistance and religious policy.
