Chapter- 5

Malaysia’s Relations with China under Abdullah Ahmad

Badawi: Enhanced Pragmatic Cordiality

Malaysia’s growing cordiality with Chinafurther enhanced under Prime Minister

Abdullah Badawi who took over Prime Minister Office as a successor of Dr Mahathir
Mohammad in October 2003. He served as Prime Minister of Malaysia from 2003 to 2008
and in 2008 he was succeeded by Tun Nazib. During his tenure, he followed the path of his
predecessor Dr. Mahathir in the purview of country’s foreign policy formulations.
Malaysia’s national interest was further reinforced and strengthened in political and strategic
areas by courting China in a positive manner. During this phase, Malaysia took a more
pragmatic posture towards China. It can be said that Malaysia, under Prime Minister Badawi
totally transformed its previous political and strategic ambiguity into a cordial and friendly
relations.However, the process of transformation from hostility to cordial understanding
actually initiatedunder the leadership of Prime Minister Tun Abdul Razak with the
establishment of diplomatic ties in 1974 between Malaysia and PRC but the real architect
behind this transformation has certainly been Dr Mahathir Mohammad. Under his apposite
leadership, Malaysian government took several initiatives in order to transform the
antagonism to amicable ties and he has been successful in carrying out this task. He was, for
the first time, able to build the bridge between these two countriesat the international sphere
as well as developed cohesive relations in the domestic level between the ethnic Chinese
population and the local Bumiputerasof Malaysia. In short, it can be said that Tun Abdul
Razak brought the atmosphere of détente in this bilateral relationship with the restoration of
diplomatic ties and gradually gathered momentum during Prime Minister Datuk
HosseinOnn’s period; later on Dr Mahathir with his strong pragmatic approach took the
bilateral ties to a stable pragmatic accommodation.Inspired and followed by Dr. Mahathir’s
path, Prime Minister Badawi augmented the cordial space a step ahead in the relationship. In
this context, it is pertinent to analyse the thrust areas of foreign policy approaches taken

1
Badawi as a Prime minister of Malaysia. Since 2003 and onwards, under the leadership of
Dato’ Seri Abdullah Ahmad Badawi, foreign policy initiatives were further refined and
strengthened and aimed to build a resilient Malaysian economy. In order to implement such
objectives, leaders incorporated several initiatives in the foreign policy domain including
strong look east policy, policy of prosper thy neighbour, etc. Moreover, Malaysian
government under Prime Minister Badawi considered economics as their primary focus of
his foreign policy formulation. Hence, the economics remained as the main vehicle in his
foreign policy pursuit of country’sdomestic economicdevelopment and how to make that
pursuit more effective would remain the prime propel to Malaysian foreign policymakers.As
a matter of fact, overall orientation of the Malaysian foreign policy formulation under Prime
Minister Badawi realisticallybased on the same principles of foreign policy formulated by
Dr Mahathir Mohammad during his tenure. In other words, it can be said that Badawi’s
foreign policy approaches were nothing but an extension of foreign policy goals set forth by
his predecessor after the end of Cold War. In this chapter, the primary focus will be to
analyse the nature of political as well as economic and trade relationship between Malaysia
and China and how far this bilateralrelationship under Prime Minister Badawi brought this
two countries closerto each other.

Malaysia and China: Sustenance of Genial Political and Strategic

Relations
Malaysia’s political and strategic relations with China have passed through
different phases started from oscillatory antagonism to a gradual shift towards mutual
détente and ended up with friendly complementary ties under the leadership of Prime
Minister Badawi’s predecessors. Malaysia during his tenure maintained as well as enhanced
the cordial rapprochement with PRC.On the other hand, China during that period emerged as
a very prominent actor and factor in the global political order. Its increasing strength
compelled the regional countries to maintain friendly relations with it. Malaysia also
understood that in the era of globalisation it could not prosper individually and thereby

2
Malaysia under Badawi’s leadership religiously followed the principle of Prosper-thy-
Neighbour as well as tried to maintain the peaceful environment in the international level.
As a result, the bilateral ties between Malaysia and China became more and more close to
each other. Dato Seri Badawi took the office of Prime Minister on October, 2003 and since
then he was meticulously pursued the rapprochement policy towards China either bilaterally
or sometimes through multilateral mechanisms. Under his leadership, Malaysian
Governmentcelebrated the 30–Years of Diplomatic Relations with China in 2004. Started in
January 2004 with a photo exhibition, the Sino-Malaysian Friendship Year was launched to
mark the 30th anniversary of the establishment of diplomatic relations between these two
countries. During this occasion, Malaysian Minister of Culture, Art and Tourism Mr Abdul
Kadir and Chinese Vice minister of Culture Mr MengXiaosi expressed their optimistic
outlook towards the prosperous bilateral relations. Malaysian Minister Abdul Kadir viewed
that his country was eager to work closely with China so that the bilateral ties has always
been on the best of terms, feelings and solidarity and in this context, he said, “We want to
always have very, very, special relationship with China.”1 The Chnese Minister
MengXiaosi,in the same occasion, also said:

“We believe that the series of celebrations for Malaysia-China Friendship Year
will have significant impacts on the development of political, economic and
cultural relations and play a positive role in enhancing mutual understanding
and friendship between the two countries and ushering in their common
prosperity.”2

Following this mind-set, in February 2004, Malaysian Prime Minister Mr

Badawi, at the Opening Ceremony of China-Malaysia Economic Conference, said:

“Malaysia, however, remained undaunted in its vision of establishing

diplomatic ties with China, the sleeping giant. We have always believed that our
security and wellbeing could only be assured by countries in the region
resolving to deal squarely and fairly with one another. Thus, Malaysia was a
moving force in the formulation of the ASEAN zone of peace, freedom and
neutrality or Zopfan, something to which we still remain firmly

1
Malaysian Minister of Culture, Art and Tourism Mr Abdul Kadir, during his visit to China,
commented. This was published in a news “Malaysia Hopes to Enhance Ties with China”, Xinhua
News Agency, available at www.peopledaily.com/en/ (accessed on 23 July 2010)
2
Ibid.

3
 committed…Malaysia’s China policy has been a triumph of good diplomacy
and good sense. Our position was that of undivided China, secure, prosperous,
at peace with itself and with the region, and this has remained undiminished all
these years. What is more, I believe that we blazed a trail for others to follow.
Our China policy showed that if you can look beyond your fears and
inadequacies, and can think and act from principled positions, rewards will
follow.”3

However, Prime Minister Badawi was also aware of regional as well as

global political order. Since one of the foreign policy goals set forth by Prime Minister
Badawi was maintaining peace and stability at the international level, he was quite vocal on
regional and international peace and in the same speech given at Malaysia-China Economic
Forum he said:

“Peace is not achieved by leaving things to happen by chance. It is not achieved

by merely taking the path of least resistance. Mankind has rarely managed to
settle disputes without resorting to violence. The Asian region, until recently,
has itself been rife with conflict. Sometimes it seems that the closer we are in
terms of geographic proximity, the more difficult our relations are. I repeat,
sometimes it seems that the closer we are in terms of geographic proximity, the
more difficult our relations are….Restraint is an essential characteristic of peace
making. Might does not make right. Just because you can, does not mean that
you should. In this regard, China’s willingness to subscribe to the ASEAN
treaty of amity and co-operation is proof that it wishes to be as diligent in the
pursuit of peace as some countries are in the pursuit of war. Its willingness to
participate actively and constructively in the East Asian political community is
a heartening sign for the future.” 4

Prime Minister Badawi also followed a good neighbourly policy as well

as upheld the policy of ‘Prosper-thy-Neighbour’. In the changing scenario of post-Cold War
globalised world, it would be very difficult to sustain individually without having friends in
the neighbouring regional sphere. Such concern was expressed in the same speech where he
mentioned:

3
Speech given by Prime Minister Abdullah Badawi during the occasion of The China-Malaysia
Economic Conference, held in Malaysia on February 2004, for details see www.pmo.gov.my
(accessed on 8 March 2011)
4
Ibid.

4
 “It is said that a good neighbour is always better than a friend far away. It is
invaluable to have a good neighbour that keeps his or her house in order and
devotes time and expense to taking care of others in the surrounding
neighbourhood. A prosperous China has a historic opportunity to use its size
and influence to push the envelope of peace and stability outwards, both for the
region and the world at large.”5

As China has been a strong neighbour and gained prominence in the

global political scenario, it would play an instrumental role in ushering as well as
maintaining a peaceful stable environment in the region. In this juncture, Mr Badawi wanted
to cultivate China’s increasingly important position at the global level as well as regional
level and thereby he tried to maintain a rapprochement with China during his tenure. With
such connection, they would establish a peaceful ambience in the region and that would, in
turn, help in building a strong regional economy as well as stable individual economy.

Prime Minister Badawi’s visit to China on May, 2004 at the occasion of

celebrating 30-Year Diplomatic Relationship, has been watershed event in the Malaysia-
China relationship.During the visit, Prime Minister Abdullah met with H.E. Hu Jintao,
President of the People's Republic of China, held official talks with Premier Wen Jiabao,
and together with Vice Premier Huang Ju, attended the commemorative reception of the
30th anniversary of China-Malaysia diplomatic relations. The two sides had an in-depth
exchange of views on bilateral, regional and international issues of mutual interest in a
friendly and cordial atmosphere, the leaders of bothcountries reached broad consensus on
the issues discussed. The leaders of the two countries noted with satisfaction the significant
progress in cooperation in the political, economic, trade, culture, education, defence and
other fields made by the two countries since the establishment of diplomatic relations 30
years ago. They underlined the importance of mutual trust and understanding and a spirit of
dialogue as the basis for enhancing constructive and friendly relations. They expressed their
shared commitment to consolidate the existing bilateral relations and work for greater
cooperation between China and Malaysia in strategic areas to serve the fundamental

5
Ibid.

5
interests of both countries.6Mr Badawi during the occasion of the official opening of the
embassy of Malaysia Chancery Building, Beijing in May 2004, enthusiastically expressed:

“The government of Malaysia decided to upgrade its diplomatic premises in

Beijing because Malaysia attaches a great deal of importance to the relations
with China, an ancient and great Asian nation. In the last 30 years, Malaysia’s
bilateral relation with China has soared from strength to strength in many areas
of cooperation. It is now truly multidimensional and multifaceted. The marked
expansion in bilateral relations would not have been possible had it not been for
the positive developments and constructive changes in the domestic as well as
foreign policies of both Malaysia and China. As a consequence, there have been
rapid improvements in the movement of people, goods and services between the
two countries. This indicates also that there has been progressive and visionary
leadership on both sides. As we look to the future, bilateral relations and
cooperation are expected to intensify even more. The two countries are now
poised to enhance relations at all levels and in all sectors of the society.”7

In this occasion, China and Malaysia issued a joint communique on

bilateral relations where the leaders of both the countries recalled the principles written in
the Communiqueon the Establishment of Diplomatic Relations signed in 1974 and further
reiterated their full endorsement and support for the Joint Statement on Framework for the
Future Bilateral Cooperation between China and Malaysia signed in Beijing on 31 May
1999.They reinforced the significance and relevance of the two Documents as a guiding line
towards the future development of intensified China-Malaysia relationsthrough various
cooperation programmes. In the Joint Communique, several issues have been highlighted
and outlined various programmes. The Communique focuses on maintaining regular
communications between the leaders of the two countries and at all levels including ruling
parties, legislative bodies, government agencies, non-governmental organization, the private
sector and their peoples in order to sustain a comprehensive development of China-Malaysia
bilateral relations. Apart from good communication there are other aspects which were
discussed in the communique; such as, improving cooperation between the two countries in

6
See Appendix 3.
7
Speech given byAbdullah Ahmad Badawi, Prime Minister of Malaysia, at the official opening of
the Embassy of Malaysia Chancery Building in Beijing on May, 2004, for details see
www.pmo.gov.my (accessed on 4February 2011)

6
the field of transportation, energy and finance as well as recognizing the significance in the
application of science and technology in the development of both countries.8

Apart from these issues, the Communique also spoke on upholding the
respect for the independence, sovereignty and territorial integrity of each other and
acknowledge that peace, security and development have currently been the main themes and
concerns to the world. In the Communique, regional cooperation has also been discussed. In
this context, both the countries should acknowledge the tremendous progress in China-
ASEAN relations in post-Cold War years and both the leadership expressed their readiness
to continue to strengthen cooperation in the ASEAN+3 process and the development of the
ASEAN-China Free Trade Area. Apart from ASEAN, both the leadership spoke on
enhancing regional and international peace and development as well as agreed to strengthen
consultations and coordination at the UN, ARF, APEC, ASEM, WTO and other multilateral
forum. Through the Communique, both the leadership expressed their concern towards the
situation in Middle East and Iraq and they uphold their commitment to fight against
terrorism in all its forms and manifestations and stressed that the international community
should enhance cooperation and address both the symptoms and root causes of terrorism.9

As a corollary to the Joint Communique, series of agreements signed by

the two countries during his visit including Memorandumof Understanding between the
Government of the People's Republic of China and theGovernment of Malaysia on
Cooperation in the Field of Foreign Affairs andInternational Relations Education,
Memorandum of Understanding between theGovernment of the People's Republic of China
and the Government of Malaysia onCooperation in the Field of Public Health and Plant
Health and Memorandum ofCooperation Between China Mayor Association and Malaysia
China Business Council.Both sides reached important consensus on strengthening bilateral
relations, agreed toboost strategic cooperation between the two countries and identified the
direction todeepen bilateral relations more and more in order to raise the existing level of
cooperation through injecting new vitalitiesin various fields of cooperation between them.

8
See Appendix 3for details.
9
Ibid.

7
 Later on, in October of the same year,State Councillor of China Tang
Jiaxuan visited Malaysia. During his visit to Malaysia, he met separately with Prime
MinisterDatuk Seri Abdullah Ahmad Badawi and Vice Prime Minister Datuk Seri Najib
TunRazak. During his meeting with Tang Jiaxuan, Badawi indicated that Malaysia took
pleasure in the smooth development of Sino-Malaysian relationship. The two sides had
frequent exchanges of visit on all levels, fruitful achievement in all areas of cooperation, and
broad consensus on regional and international issues. In the field of strategic, trade and
economic cooperation Malaysia was dedicated to its strategic cooperation with China, in
particular. While reciprocating Badawi’s mind set regarding China, Tang Jiaxuan,
highlighted the smooth development of Sino-Malaysian relationship which has been
exclusively based on political mutual trust. He said that China attached importance to its
relations with Malaysia and remained willing to elevate the all-dimensional, and friendly
cooperative relationship between the two countries to a new high and that led to further
expanded and deepened strategic cooperation between China and Malaysia which conform
to the fundamental interest of both peoples; as well as also contribute positively to regional
stability and prosperity.10

In the following year of 2005, Chinese leadership reciprocated the

Malaysian enthusiasm on the prosperous bilateral relationship through the visit of Wu
Banggao, Chairman of the Standing Committee of China’s National People’s Congress, on
May 2005 in Kuala Lumpur. During this visit he firmly mentioned:

“With concerted efforts, the China-Malaysia relationship based on traditional

friendship and mutually beneficial cooperation is bound to embrace an even
better future.”11

He also felt that the two countries have trusted and supported each other
politically, pursued common economic development through mutually beneficial and

10
Speech given by Chinese State Councilor Tang Jiaxuan in Kuala Lumpur on 22 October 2004, for
details see http://www.Chinaembassy.ee/eng/dtxw/t168185.htm (accessed on 24 December 2010)
11
Speech given by Wu Banggao, Chairman of the Standing Committee of China’s National People’s
Congress, on May 2005 in Kuala Lumpur, for details see
http://www.fmprc.gov.cn/eng/wjb/zzjg/yzs/gjlb/2732/2734/t198068.htm (accessed on 20 January
2011)

8
reciprocal cooperation, and conducted dynamic exchanges and support in the various areas,
which augmented for the steady growth in bilateral relations. Moreover, during the same
visit he explicitly said:

“Upon the 30th anniversary of our diplomatic relations last year, Prime Minister
Abdullah Ahmad Badawi paid a successful visit to China, during which he
reached important consensus with the Chinese leaders on pushing forward
China-Malaysia strategic cooperation, charting the course for the deepening of
our relations…We have been heartened by the visible results and sound
momentum in our economic cooperation and trade which has lent an
inexhaustible impetus to the development of our relations.”12

Furthermore, Mr. Wu Banggao,during this visit, has covered various

aspects of the bilateral relationship between these two countries.While delivering his speech
he exhibited his enthusiasm and viewed that Malaysia and China have maintained friendly
cooperation and coordination on many major international and regional issues and said:

“We both stand for the democratization of international relations, maintaining

that people of all countries should decide on their own domestic affairs and
international affairs be handled through equal-footed consultations among
countries…We both advocate respect for the diversity of civilizations, which
can complement each other amid competition and comparison and achieve
common development by seeking common ground and shelving differences. We
share the view that economic globalization should benefit all developing
countries and that South-South cooperation, North-South dialogue and regional
cooperation should be actively promoted in pursuit of common prosperity.”13

In this context, it can be said that Prime Minister Badawi has been able to
sustain the ambience of cordiality in the bilateral political relationship between these two
countries. Chinese leadership also aptly reciprocated their warmth and friendly gestures
towards Malaysia. Such friendly gesture has been reaffirmed once again when Chinese
Premier Wen Jiabao visited Kuala Lumpur on December, 2005. During that visit, Chinese

12
Ibid.
13
Wu Banggao, Chairman of the Standing Committee of China's National People's Congress, made
the remarks when delivering a speech titled "Deepening Good-neighborly Friendship in A Joint
Effort for Asian Prosperity," in Kuala Lumpur, on May 2004, for details see
http://english.peopledaily.com.cn/200505/31/eng20050531_187604.html(accessed on 15 January
2011)

9
Premier had anin-depth discussion with the Malaysian Prime Minister Badawi, where
Premier Wen mentioned that ‘the Chinese and Malaysian governments are formulating the
next 5-year plans. It is our common need to strengthen the cooperation. The Chinese side
would like to work with the Malaysian side to strengthen the cooperation in the following
areas: first, maintaining high-level contacts and enhancing mutual understanding and trust;
secondly, the two foreign ministries should work together to formulate joint action plans for
China-Malaysia strategic cooperation and make concrete arrangements for the cooperation
in every area; thirdly, further expanding bilateral trade, promoting energy cooperation and
discussing the common exploration of the gas and oil resources in South China Sea; and
finally, strengthening the coordination and collaboration in the East Asian cooperation
process and pushing for constant growth of East Asian cooperation.’14In response to this
statement, Dato Seri Badawi viewed that Malaysia-China relations continue to expand more
rapidly than the past years and both sides expressed deep satisfaction on account of the
growing cordial understanding.It was also felt by the Malaysian leadership that both sides
could establish closer economic and trade linkages, as well as expand trade, increase two-
way investment, and strengthen the mutually beneficial cooperation in energy, finance and
other areas.15

Malaysia’s Relation with China: Dismissal of China Threat Theory

Prime Minister Badawi sincerely followed a policy of friendship with

China in his tenure. According to some scholar, ‘Abdullah has been equally categorical;
perhaps more so than his predecessor in his dismissal of the China threat theory.’16 This
view has been explicitly expressed by Prime Minister Abdullah Ahmad Badawi, while
criticizing a joint statement issued by the United States and Japan in the year 2005,
regarding China’s threat perspective. He firmly mentioned:
14
Speech given by Chinese Premier Wen Jiabao in Kuala Lumpur on December, 2005, for details see
http://big5.fmprc.gov.cn/gate/big5/my.China-embassy.org/eng/xw/t229183.htm(accessed on 9
February 2011)
15
Comment made by Malaysian Prime Minister Abdullah Badawi, n.14.
16
Joseph Chin Yong Liow, “Malaysia’s post-Cold War China Policy: A Reassessment”, in Jun
Tsunekawa(ed.), The Rise of China: Responses from Southeast Asia and Japan, National Institute for
Defense Studies, Tokyo, 2009, p. 56.

10
 “Some countries may have quietly harboured that view -- however tenuous the
grounds -- but none overtly described China as a potential threat…This has now
changed. For the first time, the United States and Japan have issued a joint
statement declaring Taiwan a matter of mutual security concern…”17

Moreover, in a speech at an international security forum organized by the

Malaysian Institute of Strategic and International Studies, Abdullah noted that China had,
until recently, "never been openly declared a military threat or potential threat."18Regarding
the China threat issue, he strongly dismissed any kind of threat posed by Chinaand he firmly
declared that “China has no hegemonic ambitions”. Badawi also criticised the security and
defence alliances in the Asia Pacific region as ‘both unnecessary and destabilizing’ and he
felt that the China in present and ‘in the coming future will essentially be a force for peace
and stability’ for the entire region.19

Such dismissal of China threat further augmented while Chinese Premier

Wen Jiabao paid a friendly visit in Malaysia in December, 2005. Premier Wen Jiabao during
his visit agreed with Malaysian Prime MinisterBadawi to deepen the strategic cooperation
between both the countries. In this occasion, Prime Minister Badawi said:

“Malaysia-China relations continue to expand and deepen and both sides have
benefited from this relationship. The development of China is rather an
opportunity than a threat to Malaysia. We regard China as a reliable friend.
Malaysia and China are developing rapidly.”20

In this context, it can be said that the threat perspective indeed

transformed into an accommodative approach during the tenure of Prime Minister Badawi.
Instead of ambiguity in the strategic sphere due to historical Chinese threat, Malaysia during
his tenure categorically engaged into broadening the level of cooperation in the strategic
sphere. His predecessor Mahathir Mohammad essentially started to fill the gap between
these two countries and in the post-Cold War years, he was able to develop an amicable
17
Comment made by Prime Minister Abdullah Ahmad Badawi, while criticizing a joint statement
issued by the United States and Japan on June 2005, for details see
http://english.people.com.cn/200506/02/eng20050602_188079.html (12 April 2011)
18
Ibid.
19
Joseph Chin Yong Liow, n.16.
20
Speech given by Chinese Premier Wen Jiabao, n.14.

11
relationship between them; however, he could not wither away the China threat concept
totally from the Malaysian mind set. It was Prime Minister Badawi while following the path
of his predecessor abled to dismiss the threat perspective in totality of China from the
Malaysian side.Badawi’s firm negation to the China threat theory has been influenced by
certain issues. China, during his tenure, gained huge prominence in the world political and
economic sphere and attempted to create a benign image in the Southeast Asian region.
Badawi’s primary concern in the foreign policy area remained economic development of the
country as well as maintaining peace and stability in the international and regional level.
Due to this reason, he was vocal against the China threat and thereby able to keep his
identity different from his predecessor.

South China Sea Issue: the ChangingApproach

South China Sea occupies a prominent position in the political and

strategic history of Southeast Asia along with other East Asian countries. The importance of
South China Sea can be traced since long ago due to it has been hosted very significant sea
routes for trade and in some way connects east with the west. Maritime importance of this
water body, in course of time, made it strategically important entity especially after the
Second World War. With the inception of Cold War between the two power blocs, South
China Sea started gaining momentum in the consideration of international strategic power
equation since China borders with the South China Sea and on other side to maintain the
balance of power in the region and for maritime protection USA made its naval base in the
Subic Bay of Philippines. Hence, South China Sea has been enjoying immense geopolitical
importance for a long time.Furthermore, the discovery of huge natural resources such as oil
and gas; this area appeared as a cockpit of power struggleby various powers coming not only
from the region but also from outside. A number of explorations jointly made by various
regional countries with the help of different multinational companies proved the region’s
richness in natural resources. Since this issue has already been thoroughly discussed
previously in the Second Chapter, this chapter will not highlight how this place is important

12
in the context of strategic and geo-political perspective for the Asia-Pacific region.
Nevertheless, this issue has time and again played a major determining factor in the course
of development of ties between Malaysia and China. The fact remains that during
Mahathir’s tenure this issue often created tension between these two countries since both of
them along with some other ASEAN countries have been the major claimant parties in the
South China Sea dispute. Against this backdrop, this chapter will focus how Badawi
perceived as well as tackled this issue in the context of the then on going bilateral ties
between Kuala Lumpur and Beijing.

Prime Minister Badawi maintained a political and strategic détente with

China and in his tenure Malaysia and China have exhibited cooperative attitude towards
each other in the context of this South China Sea issue. While Prime Minister Badawi gave a
speech atKuala Lumpur on October 2006 duringASEAN-China Summit Meeting, he
stressed that in the security field, China and some ASEAN countries had reached mutual
understanding on some issues, including the South China Sea issue, which, to a certain
extent, ‘had increased the mutual understanding between the two sides and made
contributions to the stability of the South China Sea region’.21Moreover, it has also been
observed that Badawi has repeatedly said that his government does not view China as a
strategic threat from the Malaysian perspective.The then Chinese Premier Wen Jiabao
further vocal on expanding bilateral trade, promoting energy cooperation and discussing the
common exploration of the gas and oil resources in South China Sea region.While
reiterating the same view, on March 29 2006, Chairman JiaQinglin of the National
Committee of the Chinese People's Political Consultative Conference (CPPCC) visited
Malaysia and met with Malaysian Prime Minister Abdullah Ahmad Badawi in Kuala
Lumpur. During his discussion with PM regarding the future course of bilateral relations, the
Chinese leader expressed deep satisfaction with reference to the on-going bilateral ties and
said that a major objective for both the countries has been to “actively develop energy
cooperation and enrich connotation of bilateral relations. Both sides should give play to their
respective advantages in the areas of resources and market and push related cooperation
programs to bear early fruits. Efforts should also be made to actively discuss approaches and

21
Prime Minister Badawi commented on October 2006, available at
http://asean-Chinasummit.fmprc.gov.cn/eng/zxxx/t277397.htm (accessed on 23February 2011)

13
ways for joint exploitation of South China Sea in the principle of mutual respect, equality
and mutual benefits and make South China Sea a bond for bilateral energy
cooperation.”22He further added that the two countries should turn the South China Sea into
a link of energy cooperation on the basis of mutual respect and mutual benefit.

However, the continuity of evolving on going ties between the two

countries slightly hinged in the later period of Badawi’s tenure as a Prime Minister when
some disagreements were evolved with reference to the claim of islands.Both Malaysia and
Chinarekindled the sovereignty disputes over the Spratly islets and reefs in the South China
Sea and recast a spotlight on the issues andstarted disputing over the ownership of some
islands in the Nansha Archipelago. Both of them they could proceed from maintaining peace
and stability of South China Sea and also expressed many times that the disputes should be
solved by friendly consultants and negotiations with other countries concerned to implement
the follow-up actions of the Declaration on the Conduct of Parties in the South China Sea,
according to established principles of international law.

Apart from South China Sea issue, both the countrieshave started working
on improvingbilateral defence ties during Prime Minister Badawi’s tenure. For instance, in
September 2005, both the Government signed a Memorandum of Understanding on Defence
Cooperation. The Memorandum is basically aimed to facilitate activities such as military
training, exchange of personnel and regular dialogue. As a consequence of the
Memorandum, a number of Malaysian military officers have attended military academies in
China, and vice versa. China has also offered to sell weapon systems, including naval ships
to Malaysia;howeverlatter has politely refused those offers rather preferred to continue its
major arms purchases from traditional suppliers such as United States, Britain and Russia
due to different reasons.

22
JiaQinglin, Chairman of the National Committee of the Chinese People's Political Consultative
Conference (CPPCC) made this comment on March 2006, for details see
http://www.gov.cn/misc/2006-03/30/content_240142.htm (accessed on 2April 2011)

14
Malaysia’ Relations with China: ASEAN as a Linking Bridge

ASEAN, in its due capacity, has been working as a platform in the

context of bilateral relationship between Malaysia and China since the end of Cold War.
With the end of Cold War, the structure of international political domain has been changed
in its entirety. Several new approaches started blooming in the international political order,
namely, globalisation, regionalism, multilateralism etc. In such a changing scenario,
Malaysia under the prudent guidanceof Dr Mahathir developed itself in the Southeast Asian
region and became instrumental in promoting and developing several multilateral regional
arrangements and the concept of regionalism.Among such arrangements, ASEAN has been
emerged as the most important vehicle for linking better coordination and of mutual
understanding. Mahathir’s successor, Prime Minister Badawi, aptly followed the path
initiated by Mahathir and became an ardent proponent of regional cooperation in this region.
Badawi, like his predecessor, invitedChina in such regional activities as China in the post-
Cold War era emerged as a major power in the global political scene.China, understanding
the nature of international political order, engaged itself in regional cooperation.

Indoing justice to all and boosting actively the cooperation and

development of developingcountries in international relations, participated first ASEAN-
China, then ASEAN+3 andEast Asian Summit organized by Malaysia. Former Prime
Minister Datuk Seri Mahathirbin Mohammad for many times publicly refuted the so-called
“China Threat Theory”.Even Chinese leadership has also considered Malaysia as China's
important partner in ASEAN. With in-depth advancing of bilateral strategic cooperation, the
development of bilateral relations been faced with a new sound opportunity under Badawi’s
term. China would like to make joint efforts with Malaysia to push bilateral good-
neighbourly relations to develop in a new depth and width and make both sides good friends
that rely on each other and good partners in mutually beneficial cooperation forever. China
initiated couple of proposals on further developing bilateral relations in the following four
aspects.During Prime Minister Badawi’s tenure, Chinese leadership also realised that in
order to strengthen coordination and cooperation in international and regional affairs and

15
they have to safeguard and promote just rights and interest of developing nations. The
summit in celebration of the 15th anniversary of China-ASEAN relations was held in
Nanning this October and China would like to work with all ASEAN countries including
Malaysia to take this summit as an opportunity and push for greater development of bilateral
relations.On issueslike human rights, democracy and China’s peaceful reunification,
Malaysia explicitlydemonstrated their support for China, and played an important role in
boostingChina-ASEAN cooperation.23 The two countries have been cooperating in
problemsinvolving regional and bilateral securities of anti-terrorism, preventing and
checkingacute diseases from spreading, anti-drug campaign, cracking down on cross-border
crimes.

Furthermore, the two countries hold identical or similar standpoints and

views inmany important global and regional issues such as the United Nations reform, East
Asiacooperation, and coordinate well. Both believe that people in each countries
shoulddetermine their own affairs and world affairs should be equally negotiated
betweencountries; that cultural diversity should be respected; that competing ones should
learnfrom other's strong points to make up their own deficiencies, and to achieveco-
prosperity by seeking common ground while reserving differences; that
economicglobalization should benefit all developing countries, positively push
forwardSouth-South cooperation and North-South dialogue as well as regional cooperation
torealize co-prosperity. China, which appreciates and supports Malaysia’s standpoint
andattitude of actively participating in regional and global affairs, in opposing powers, has
taken several approaches in cooperation with Malaysia under the skilful leadership of
Malaysian Prime Minister Abdullah Badawi.

It is explicit in the above discussion that the Joint Communique and the
celebration of 30-Year Diplomatic Relationship essentially provided a friendly environment
during Prime Minister Badawi’s tenure in the context of bilateral ties with China. The
initiatives came from both Malaysia and China in order to sustain the cordial
accommodation. It is true that Badawi’s predecessor Mahathir worked hard to create such

23
Official report of Third China-ASEAN Business and Investment Summit, available at
www.fmprc.gov.cn (accessed on 22 August 2010)

16
pragmatic accommodation and thereby the main credit certainly goes to him; however,
Badawi’s contribution in the maintenance of such amicable situation has also been
commendable. His pragmatic insight and approach in dealing with foreign relations helped
in the overall development of country’s economy.

Malaysia and China: More Economic Coordination

Malaysia’s relationship with China, under Prime Minister Badawi,

maintained cordiality throughout his tenure. During his tenure, the economic and trade ties
further enhanced and trade volume increased to a great extent than Mahathir’s period.
However, the smoothness in the economic relationship started under the leadership of
Mahathir Mohammad since 1980s and with the end of epoch-making Cold War, the process
further enhanced as well as integrated. Prime Minister Badawi continued the process
initiated by his predecessor and maintainedits spree more and more during his short
tenure.Over the years, it is found that economic relationship was in command or in other
words, it can be said that political relationship came as a corollary in the realm of bilateral
relationship between these two said countries.Hence, the thrust area in the said bilateral
relationship is the economics. After coming into power, while delivering a speech in the
occasion of China-Malaysia Economic Forum on February 2004 in Kuala Lumpur, Prime
Minister Badawi said:

“China’s economy is currently the sixth largest in the world and in the near
future, it is conceivable that it will become fifth, perhaps even the fourth. The
principal consequence of this incredible growth is that the world’s centre of
economic gravity will shift towards East Asia. Political and social linkages are
bound to eventually follow suit.”24

24
Speech given by Prime Minister Badawi at the China-Malaysia Economic Forum on February
2004, held in Kuala Lumpur, for details see www.pmo.gov.my (accessed on 14 October 2010)

17
 Badawi has been very over-whelmed of the growing economic clout of
Chinain emerging global politics and he felt that would have a spill over effect on
Malaysia’s economic and trade relations with China. In the same speech he enunciated:

“Already, we have started to witness this shift and Malaysia has been a prime
beneficiary of these changes. From 1999 to 2002, our bilateral trade with China
grew by 960 per cent, from RM 4.6 billion to RM 44.1 billion. In 2003,
Malaysia was China’s seventh largest export market, while China was
Malaysia’s fourth. The situation certainly augurs well for both our countries.”25

It has already been discussed that one of thethrust areas of his foreign
policy formulation remained the concept of maintaining peace and stability as well as
maintaining good neighbourly policy and thereby achieving the economic growth. Such
outlook has been reflected in the same speech given at the occasion of China-Malaysia
Economic Forum, where he said:

“The reason why we have been so economically successful is that we have

managed to maintain a state of relative calmness and tranquillity so that we go
about the business of attending to our primary constituents – our people. We are
neighbours, parts of an interlocking and ever interdependent network of
economies. We are all part of the same village, the same neighbourhood.”26

In this context, it can be said that Badawi with his pragmatic

consciousness incorporated the good neighbourly policy and maintaining peace and stability
in the international environment, which in turn helped his government to develop better
economic and trade linkages with his neighbour and other extra-regional countries. Such
initiatives were also taken by his predecessor Mahathir Mohammad, but he did not
emphasise on the peaceful environment in a way Prime Minister Badawi emphasised.

With such realistic outlook, Prime Minister Badawi in May 2004 signed a
Joint Communique with Chinese Government which undoubtedly enhanced their mutual
cooperation in each other’s development. In the Communique, it is mentioned that in order
to enhance the relationship both the countries would exploit the comparative economic

25
Ibid.
26
Ibid.

18
advantages of their respective economies in order to strengthen and deepen economic
cooperation which resulted inan increaseof two-way trade to a significant level by 2010. The
two sides warmly welcomed the signing of the Memorandum of Understanding on
Strengthening the Cooperation of WTO/TBT and the Memorandum of Understanding on the
Strengthening the Cooperation of WTO/SPS. Both the countries also agreed to resolve any
arising trade disputes in the spirit of mutual understanding and cooperation in accordance
with the relevant principles of the World Trade Organization.27It was also decided by them
to strive for a balance of trade and would recogniseChina's full market economy status by
the Malaysian side.In this connection, Badawi mentioned:

"I believe there is a good potential for improvement in various fields. While
maintaining and strengthening the trade and investment cooperation, we shall
go into intensive cooperation in areas of science and technology such as bio-
technology, information and communication technology."28

Apart from that, in the Communique, the Malaysian leadership agreed to

recognizeChina's full market economy status. Both Malaysia and Chinaemphasised the
participation of enterprises from both the countries in the development of infrastructure in
each other. Moreover, the Chinese leadership expressed its readiness to provide financing
facilities for Chinese enterprises investing in Malaysia. Furthermore, according to
Communique, both the sides agreed tocontinue to encourage their enterprises respectively in
order to make joint investment in a third country.29Also, in order to strengthenbilateral
cooperation in the field of agriculture,both the countries agreed to accelerate the
implementation of the Agreement on Agricultural Cooperation signed by the two
governments in 2003. Along with that, bilateral cooperation in the field of agricultural R&D
in rice planting, aquaculture and other related fields would also be pursued.

Thus, with such growing cordial accommodation, the trade volume

between the two countries has increased rapidly in recent years. In 2003, Malaysia was

27
See details of the Joint Communique 2004 in Appendix 3.
28
Excerpt from an interview of Malaysian Prime Minister Badawi on May 2004, available at
http://english.peopledaily.com.cn/200405/21/eng20040521_143986.html (accessed on 13 December
2010)
29
Ibid.

19
China's 7th largest export market while China was Malaysia's 4th export market. During the
same occasion Badawi happily mentioned that such bilateral relations have certainly
benefited Malaysia as well as China. The growing economic relations between Malaysia
under Prime Minister Badawi’s tenure can be reflected from the Table1 below.

Table 1

Malaysia’s Trade with China under Prime Minister Abdullah Badawi

(US $ Billion)

Year Export Import Total Trade

2004 18.174 8.087 26.261
2005 20.096 10.607 30.703
2006 23.575 13.537 37.112
2007 28.707 17.690 46.398
2008 19.063 12.017 31.079

SOURCE:Prepared by author based on the information available in various

issues of Monthly Bulletin of Ministry of Commerce of PRC, available at
http://english.mofcom.gov.cn/ (accessed on 23 December 2011)

Malaysia’s trade with Chinaduring Prime Minister Badawi’s period had

increased from US$18.8 billion in 2004 to US$ 28.707 in 2007(table1).The bilateral trade
from 2004 to 2008 was increasing in nature, though the amount of Malaysia’s export to
China was much higher than China’s export to Malaysia. However, in the above chart it is
clearly seen that the flow of trade has essentially not been upward in nature; rather the flow
is marked by ups and downs in trade volume. For instance, total trade volume was
increasing from 2004 to 2007 in a promising way, but in 2008, total trade volume was much
less than previous year, on account of sudden global recession which had a spill over effect
on Malaysian economy. Apart from that, it is also visible that the export amount has always
been quite higher than the import amount. Despite of that, the overall trade relations was

20
promising as well as consistent in nature. Regarding such flourishing bilateral relations
between Malaysia and China, then Prime Minister Badawi in 2006commented:

“China's economic development had benefited Malaysia in many ways and

China's success had made contributions to Malaysia's success and the stability
of South-East Asia.”30

During the years between 1991 and 2004, two-way trade increasedyear by
year. Malaysia has become a major trading partner of China among ASEAN countries. In
this context, then Chinese legislator Wu Banggao, Chairman of the Standing Committee of
China's National People's Congress,while he was in Malaysia during his four-nation Asia-
Pacific tour, delivered a speech titled "Deepening Good-neighbourly Friendship in A Joint
Effort for Asian Prosperity",where he expressed optimism towards bilateral trade and said:

“With the current momentum sustainedannual two-way trade is expected to

reach or even exceed 50 billion US dollars by 2010.”31

During Prime Minister Badawi’s period, Chinahas been a major importer

of Malaysian electronic products, palm oil and rubber. Bilateral cooperation in such
identified key areas as agriculture, hi-tech, resource development and infrastructure is on the
upswing. Bilateral cooperation in tourism and education is also expanding rapidly.
Moreover, in the same visit, he further said:

“As developing countries, China and Malaysia share broad agreement and have
maintained good cooperation and coordination on many major international and
regional issues, which has contributed to maintaining and promoting the
legitimate rights and interests of the developing countries.”32

Withsuch optimism, Prime Minister Badawi intended to establish a better

cordiality in the realm of political ties. In other words, a cordial economic relation via trade
andinvestment would accelerate a congenial environment for political relations in the age of
globalisation.In 2005, during the same visitto Kuala Lumpur Wu Banggao observed:

30
Comment made by Malaysian Prime Minister Badawi, n.21.
31
Wu Banggao, n.13.
32
Ibid.

21
 “The two countries have trusted and supported each other politically, pursued
common economic development through mutually beneficial and reciprocal
cooperation, and conducted dynamic exchanges and cooperation in various
areas, all contributing to the steady growth in bilateral relations.”33

Such view was corroborated by Chinese Premier Wen Jiabao in the same
year while he paid an official visit to Kuala Lumpur and said:

“New progress has been achieved with the economic and trade relations. The
trade volume between China and Malaysia accounted for newly one quarter of
the total trade volume between China and ASEAN.”34

Moreover, during the same visit, Wen Jiabao exhibited his more interest
towards developing an increasing economic and trade relations with Malaysia and said:

“The Chinese side would like to work with the Malaysian side to…further
expanding bilateral trade, promoting energy cooperation and discussing the
common exploration of the gas and oil resources in South China Sea.”35

Malaysia’s Prime Minister Badawi reciprocated the enthusiasm revealed

in Chinese side and said:

“The Malaysian side hopes that both sides establish closer economic and trade
linkage, expand trade, increase two-way investment, and strengthen the
mutually beneficial cooperation in energy, finance and other areas.”36

Prime Minister Badawi always expressed and emphasised that bilateral

economic and trade relations between Malaysia and China has been going under rapid
progress which is even visible from the Table1. While reiterating the growing economic
linkages, in 2005, at Malaysia-China Business Forum, Prime Minister Badawi mentioned:

“Malaysia and China can be considered as natural trading partners due to our
historical ties, geographical proximity, rich product diversity and robust

33
Ibid.
34
Wen Jiabao, n.14.
35
Ibid.
36
Abdullah A. Badawi, n.21.

22
 economic growth…China is Malaysia’s fourth largest trading partner with a
total trade valued at almost 19 billion US dollars in 2004. Trade with China
made up about 8 per cent of Malaysia’s global trade in the same year. This
makes Malaysia China’s largest ASEAN trade partner. Meanwhile, Malaysian
exports to China have also increased by almost 25 per cent, reaching a new high
of 8.5 billion US dollars in 2004. Malaysia was also China’s 8th largest trading
partner last year. This position was mainly achieved through the sale of power
generation equipment, mineral fuels and animal fats.”37

The economic relationship which evolved during Prime Minister

Badawi’s period, has no doubt ushered a more accommodative environment between
Malaysia and China and where the past Chinese threat has been totally withered away. This
new Malaysian mind-set was clearly reflected when Prime Minister Badawi in a speech,
delivered in 2006, said:

“The trade ties between the two sides were more active than in the past, and the
trade volume was continuing to increase…China was Malaysia's friend and
Malaysia had maintained close consultation and cooperation with China in
many fields.”38

Thus, with such optimistic approaches of the leadership of both the two
countries, the trade and economic ties further enhanced and took the relationship to a
different extent.Later on in 2009, Abdullah A Badawi’s successor, Prime Minister Tun
Nazib expressed:

“Bilateral trade between Malaysia and China reached $39.06 billion in 2008 an
increase of 10.3 percent compared with 2007. Two-way trade was less than
$100 million in 1974 when Tun Razak made the historic visit. China is now
Malaysia's fourth largest trading partner and fourth largest export market. Most
of Malaysia's imports come from China. China is also a very important
destination for Malaysian investments.”39

37
Speech given by Malaysian Prime Minister Badawi at Malaysia-China Business Forum held in
Malaysia on August 2005, for details see www.pmo.gov.my (accessed on 5 December 2011)
38
Comment made by Malaysian Prime Minister Badawi, n.21.
39
Speech given by Malaysian Prime Minister Tun Nazib in June 2009 available at
http://www.Chinadaily.com.cn/China/2009malaysia/2009-06/02/content_7961842.htm

23
 Therefore, economic relations between Malaysia and China during the
Badawi period increased very sharply than his predecessor.

Investment as a Linking Point between Malaysia and China under Prime

Minister Badawi

The growing accommodation between Malaysia and China in the post-

Cold war years exhibited an upward trend during the tenure of Prime Minister Badawi. Such
growing cordial understanding reflected a positive footstep in every area of relationship
especially in the trade and economic ties. During these years bilateral investments
maintained upward mobility except financial crises brought a temporary downturn in the
trade and investment relations. Malaysia and China continued to show positive upward
leanings in the investments between the two countries after the signing of the Bilateral Trade
Agreement in 1988.The below Table:2 amply demonstrates the upward mobility of
investments between Malaysia and China.

Table 2

Malaysia’s Investment Relations with China from 2004 to 2008

(in RM million)

Chinese investment Malaysian investment

Year
in Malaysia in China
2004 41 405
2005 73 911
2006 86 1141
2007 129 989
2008 100 647

24
 Note: RM stands for Malaysian Ringgit
SOURCE:Prepared by author based on various Monthly Statistical Bulletin, Bank
Negara Malaysia. For details see http://www.bnm.gov.my/(accessed on 15 December
2011)

The Table2 explicitly revealed the nature of bilateral investments in both

the countries during Prime Minister Badawi’s period. However, like the trade volume, the
investment pattern also portrays that the Malaysian investment in China has been far more
than the Chinese investment in Malaysia. For instance, in 2004, total Chinese investment in
Malaysia was 41 million RM whereas total Malaysian investment in China has been ten
times more than that figure which is clearly displayed in the Table2. However, it is also true
that in the later years the gap between these two countries’ investments started narrowing.
Prime Minister Badawi, during his tenure, has taken several initiatives to increase the
investments and such initiatives have been reciprocated by Chinese leadership also.In this
context, it can be said that Badawi understood that for his country’s development,
investment by the Chinese entrepreneurs has been essentially needed. In order to attract the
Chinese entrepreneurs Malaysian leadership offered numerous opportunities for Chinese
investors in Malaysiaand welcomed and encouraged them their participation. Prime
Minister Badawi announced two packages of economic reforms relating to the services and
financial sectors. These measures would make foreign investment easier and more
attractive, and Malaysian Government would like to see an increase in the number and
profile of Chinese investments.

Thus, over the years investments, as a means, brought Malaysia’s relation

with China more and closer to each other.

Regional Economic Cooperation: Working as a Vehicle in Malaysia-China

Economic Ties

One of the major foreign policy goals of Malaysia, under the leadership
of Prime Minister Badawi, remained ‘Prosper-thy-Neighbour’, or in other words, his

25
inclination towards maintaining good-neighbourly policy in the Southeast Asian region.
Malaysia has always been a significant member of ASEAN and other such regional
initiatives; especially under the empirical leadership of previous Prime MinisterMahathir bin
Mohammad, Malaysia initiated building such cooperative arrangements. Badawi also
engaged himself in increasing existed economic and trade cooperation in the region. The
rationale behind such exercises remains through such organisation, Malaysia and other
Southeast Asian countries could develop their own respective economies with the increasing
trade with China. Apart from Malaysian perspective on the enhanced regional cooperation,
the then Chinese leadership also emphasised their interests towards developing a cordial tie
with ASEAN countries including Malaysia. In this context, Prime Minister Badawi on the
occasion of ASEAN-China Commemorative Summit, held in China on October 2006, firmly
viewed:

“Over the years, the level of trust and confidence between ASEAN and China
grew from strength to strength. This has contributed substantially to the
sustaining of regional peace, stability, progress and prosperity….Malaysia has
always viewed China as a very important strategic partner for ASEAN. China is
both an important source and destination of trade and investment. China is also
an important global player which can exert much influence not only on regional
but also international peace and security.”40

Such approach of Prime Minister Badawi has certainly been a positive

outlook towards China’s involvement in the ASEAN region in various issues. Even in the
economic sector China’s involvement and cooperation in the ASEAN region are certainly
attributed to a positive role. Such outlook has been expressed in the same speech of Prime
Minister Badawi where he said:

“We thank China for hosting this special commemorative summit, to mark
fifteen years of friendship and cooperation which was formally launched in
1991 and developed into a full dialogue partnership in 1996. We have faced
many challenges together including the Asian financial crisis in 1997, during
which we convened the First ASEAN-China Summit.”41

40
Speech given by Prime Minister Badawi at the occasion of ASEAN-China Commemorative
Summit held in China on October, 2006, for details see www.pmo.gov.my (accessed on 24 June
2011)
41
Ibid.

26
 Prime Minister Badawi sincerely felt that the economic advancement of
the entire ASEAN region including Malaysia has been integrally related to Chinese
cooperative attitude towards this region. In this context, in the same speech, he further
added:

“I am pleased to note that since the conclusion of the ASEAN-China

Framework Agreement on Comprehensive Economic Cooperation in 2002,
coupled with the subsequent implementation of the Early Harvest Programme
and Agreement in Trade in Goods, there has been substantial progress in the
substance of ASEAN-China economic relations. For instance, the total trade
between ASEAN countries and China has increased significantly to reach USD
131 billion in 2005. This augurs well for attaining the target set by the Chinese
President for trade between ASEAN and China to reach USD 200 billion by the
year 2010.”42

As a consequence of such integral cooperation, China and ASEAN as a

region together, were in a path of implementation of some of the recommendations,
contained in the 2005 Report of the ASEAN-China Eminent Persons Group (the ACEPG)
that was formed in 2004. For instance, the ASEAN-China Centre for Trade, Investment and
Tourism Promotion, during his tenure, was established. He wholeheartedly supported
China’s intention to contribute USD1 million respectively to the ASEAN Development
Fund and Initiative for ASEAN Integration process. He considers this initiative of China as a
clear commitment by China to support ASEAN’s own community building efforts. ASEAN
values very much this gesture by China.Moreover, in a different speech he emphasised
China’s importance in the ASEAN regional cooperation and said:

“…China is very important to ASEAN, firstly because China is a very major

source and destination of trade and investment for ASEAN countries. Secondly,
China is a regional country which is, at the same time, a very important global
player in the context of international peace and security. Therefore, it is correct
to say that the relation between ASEAN and China is special in many
respects.”43

42
Ibid.
43
Speech given by Prime Minister Abdullah Badawi at the Third China-ASEAN Business and
Investment Summit held in China on October 2006, for details see www.pmo.gov.my (accessed on
20 February 2011)

27
 On 22 October 2004, Malaysian Prime Minister Badawi met with Chinese
State Councillor Tang Jiaxuan in Kuala Lumpur, who was on an official friendly visit to
Malaysia. During his visit, Tang Jiaxuanpointed out that China would support to the East
Asian regional cooperative arrangements and he said:

“…Sino-Malaysian trade and economic cooperation constituted the basis of

bilateral strategic cooperation. The two sides needed to push for cooperation
between business communities in both countries in the fields of energy,
agriculture, telecommunication, infrastructure and hi-tech, etc. China also stood
willing to step up consultation with the Malaysian side to jointly promote East
Asia regional cooperation.”44

In order to promote a better and congenial environment for regional

cooperation, Malaysian leadership under Prime Minister Badawi had taken several
measures. For instance, Government plans, such as Malaysia’s Third Industrial Master Plan
were made transparent and open to scrutiny. ThisPlan provided a guide for the course of
trade and industrial development of Malaysia for the next 15 years, i.e., till 2020. It was also
drawn up in full consultation with the private sector. Even Badawi felt thatthe Industrial
Master Plan document has been very useful for any business person looking to engage in
long term business relationships in Malaysia and he recommended Malaysian example to
China and to other ASEAN countries. In addition to the Third Industrial Master Plan, there
is 9th Malaysia Plan, which covered the period 2006-2010. These two documents are aimed
to provide a comprehensive perspective on the future directions of Malaysia’s industrial
development and growth.

Apart from those Plans, Malaysia supported the regional cooperation in

the ASEAN region and firmly acknowledged China’s positive support towards the region in
economic sector.Badawi felt that China had seriously been working at developing economic
and trade ties with ASEAN countries, and had given substantial support in this field.45In his
period, Chinaenthusiastically engaged with Malaysia as well as other ASEAN countries in
order to increase the trade relations and other sorts of economic cooperation.

44
Tang Jiaxuan, n.10.
45
Excerpt from an interview of Prime Minister Badawi, n. 21.

28
 Summarily then, it can be said that Malaysia’s relations with China,
during Abdullah Badawi’s period, was very much friendly in nature. In political and
strategic sphere, they have signed various agreements for better coordination. Both the
countries’ gave importance to the regional cooperation in order to promote a better
environment in the region as a whole and that would entail a better ambience for individual
development. Apart from that, Malaysia’s economic and a trade relation with China, during
Prime Minister Badawi’s period, has portrayed a strong as well as steady relationship. The
total volume of trade has been proliferated during his period. In this context, it can be said
that Badawi’s predecessor Dr. Mahathir was the main architect for developing a pragmatic
cordiality with China especially in the economic and trade sector. However, Prime Minister
Badawi followed the path of his predecessor and has been able to overcome all sorts of
obstacles in the evolving bilateral ties and that cordial ties even continued by Tun Nazib
who took over power as a new Prime Minister of Malaysia in 2009.

29