Malaysia's PM halts China’s ‘belt and road’ but relations remain strong

Malaysian PM Mahathir Mohamad at a meeting with Chinese President Xi Jinping (not pictured) at Diaoyutai State Guesthouse in Beijing, on Monday. (Reuters)
Updated 25 August 2018

Malaysia's PM halts China’s ‘belt and road’ but relations remain strong

KUALA LUMPUR: Prime Minister Mahathir Mohamad’s official visit last week has reaffirmed Malaysia’s footing with China despite the Malaysian prime minister axing two ‘One Belt, One Road’ projects.
Mahathir’s five-day trip to meet Xi Jinping was key in resetting the relationship. He expressed strong views on China’s economic power during a meeting with Premier Li Keqiang on Monday morning.
Mahathir warned about a “new version of colonialism” because poor countries were unable to compete with rich countries in open free trade. He said: “It must also be fair trade. Then I support free trade together with Prime Minister Li because I think this is the way to go for the whole world.”
However, analysts remain optimistic about relations between Malaysia and China, noting that the warm attention given by Beijing was a sign of respect for the 93-year-old prime minister of Malaysia. China’s President Xi Jinping himself welcomed Mahathir with the highest honors, including the red carpet treatment.
“All in all, I think it was a good visit as it has reset Malaysia-Sino relations. Mahathir reaffirmed that he remains China-friendly and Malaysia is open for more Chinese investment,” said Michael Yeoh, president of the International Strategy Institute and chairman of the World Chinese Economic Forum, adding that Mahathir was clear on the sort of investment Malaysia wants.
Malaysia-based political analyst Dr. Oh Ei Sun told Arab News that bilateral relations between the two countries will not be affected by Malaysia’s cancelation of several allegedly overpriced projects as there was still a large trade volume to consider.
China is Malaysia’s largest trading partner, while Malaysia is China’s largest ASEAN trading partner. Sino-Malaysia bilateral trade was at $US96.03 billion last year, witnessing a 10 percent increase.
Since the Pakatan Harapan government took office in May, Mahathir and his Cabinet have taken drastic steps to curb corruption and implemented a “belt-tightening” plan.
Najib Razak, the former prime minister of Malaysia who was allegedly involved in a billion-dollar siphoning off of 1MDB state funds, was accused by Finance Minister Lim Guan Eng of mismanaging the country’s coffers, which resulted in $251 billion of debt.
In June, Mahathir announced that his administration would halt several massive budget projects from the previous Najib Razak administration, including the $20 billion East Coast Rail Link and the state of Sabah’s $2 billion gas pipeline projects.
“Mahathir and prior to that Daim Zainuddin (chairman of Malaysia’s Council of Eminent Persons), had to go personally to China to explain to them Malaysia’s dire indebtedness and therefore unaffordability to undertake those projects. As Malaysia’s comprehensive strategic partner, China should understand that,” Dr. Oh said.
“In the long run the Chinese government would prefer a well-administered Malaysia due to various geo-political considerations,” said Jack Lim, director of business development at Gartner Inc. based in Kuala Lumpur. Lim told Arab News that it was a timely reminder to President Xi that Malaysia is supportive of Mahathir’s desire to wipe out corruption and unsustainable business practices.
Under Xi’s administration, the Chinese government went on a massive anti-corruption campaign in which he vowed to crack down on “tigers and flies.” More than 100,000 politicians and officials have been indicted for corruption since 2012.
According to China’s state-run television CCTV, Beijing has expressed the need to strengthen cooperation with Kuala Lumpur via the new silk road and explore cooperation in other countries involved in the initiative. Beijing has emphasized the need to increase “strategic communication” between the two countries.
China’s ambitious Belt and Road initiative is a vast trade and infrastructure vision spanning Asia, Europe and Africa. Australia-based Professor James Chin, from the Asia Institute, told Arab News that China still sees Malaysia as an important country for the initiative and its controversial South China Sea issues.
Prof. Chin said that the two projects were only “suspended” and not canceled. “Mahathir wanted China to reduce prices on the two projects, but China is not ready to renegotiate,” he said, adding that the Malaysian premier will wait until China is ready to reach a deal.
“So far China has not reacted strongly to Mahathir’s statements, even though their own press left out comments about “colonialism” and “fair trade,” said Singapore-based political analyst Dr. Ian Chong. He said that Beijing was willing not to oppose the current administration’s position, at least for now.
“The visit hit all the right notes. Mahathir managed to get his message across, and China did not explicitly oppose it. The question is what the follow-up will look like,” he said.


Germany wants broader Iran nuclear deal

Updated 23 min 57 sec ago

Germany wants broader Iran nuclear deal

  • Iran’s Foreign Minister Mohammad Javad Zarif has rejected talk of reopening the 2015 deal

BERLIN: Germany said Friday that a new broader Iran nuclear accord must be reached to also rein in Tehran’s ballistic missile program, warning that the 2015 deal was no longer enough.
“A form of ‘nuclear agreement plus’ is needed, which also lies in our interest,” German Foreign Minister Heiko Maas, whose country currently holds the EU presidency, told Spiegel magazine in an interview.
“We have clear expectations for Iran: no nuclear weapons, but also no ballistic rocket program which threatens the whole region. Iran must also play another role in the region.”
“We need this accord because we distrust Iran,” he added.
The 2015 nuclear deal — known formally as the Joint Comprehensive Plan of Action, or JCPOA — gave Iran relief from sanctions in return for curbs on its nuclear program.
The European Union and the United States were key signatories in the deal but US President Donald Trump unilaterally withdrew from the accord in 2018 and has reimposed crippling sanctions on Tehran as part of a “maximum pressure” campaign.
President-elect Joe Biden has signalled that Washington could rejoin the deal as a starting point for follow-on negotiations if Iran returned to compliance.
But Iran’s Foreign Minister Mohammad Javad Zarif has rejected talk of reopening the 2015 deal, saying on Thursday: “We will not renegotiate a deal which we negotiated.”
He added that Western powers should look to their own behavior before criticizing Iran.
He also complained at what he characterised as a lack of European outrage at the assassination of one of Iran’s leading nuclear scientists, Mohsen Fakhrizadeh, outside Tehran last week — an attack Tehran has blamed on Israel.
Decades old US-Iranian tensions dramatically escalated after Trump walked out of the deal.
In recent months, alarm has also grown over Iran’s regional activities through proxies in Lebanon, Iraq, Syria and Yemen, which the West says destabilizes the region.