Najib heads to China in bid to take relations to ‘greater heights’

KUALA LUMPUR — Malaysian Prime Minister Najib Razak will head to China next week for a week-long visit aimed at building closer ties with his country’s biggest trading partner.

“We will be signing many new agreements and understandings that will elevate the relationship between our two nations to even greater heights,” the prime minister said in a statement on Wednesday (Oct 26).

“The Asian Century has begun and few countries represent the potential of our region better than China and Malaysia.

“Together, working in partnership, I am confident that if we grasp the huge opportunities before us, we will transform the lives of our people and reshape the region and the world for the better,” he added.

Mr Najib will meet President Xi Jinping and Premier Li Keqiang to discuss bilateral cooperation in education, defence, trade and investment, and tourism, among other areas, the Malaysian Foreign Ministry said in a statement on Thursday.

The Malaysian PM is also expected to receive courtesy calls from National People’s Congress of China chairman Zhang Dejiang and other prominent provincial leaders.

“Malaysia is optimistic that this visit will strengthen the existing friendly ties between Malaysia and China not only in the areas of bilateral cooperation but also on regional and international issues,” the foreign ministry added.

This is Mr Najib’s third visit to China since he took office in 2009.

It comes days after President Rodrigo Duterte of the Philippines visited Beijing and declared a “separation” with long-time ally United States and said he had “realigned” with China.

China has been Malaysia’s largest trading partner since 2009, while Malaysia is China’s eighth-largest trading partner.

Trade with China totalled US$59.12 billion (S$82.3 billion) last year, accounting for 15.8 per cent of Malaysia’s total trade.

For the period of January to August this year, total trade with China increased by 1.4 per cent to US$36.59 billion compared with the same period in 2015.

Ties between both countries reached a new peak when China bought two multi-billion-dollar strategic assets from Malaysia’s debt-laden state-owned investment firm, 1Malaysia Development Berhad (1MDB).

In December, China Railway Construction Group procured a 60 per cent stake in 1MDB’s property project known as Bandar Malaysia for US$1.7 billion in a joint venture with Malaysian Iskandar Waterfront Holdings.

This came shortly after China General Nuclear Corp acquired Edra Global Energy Berhad and its subsidiaries in a US$2.3 billion cash deal. Edra is the country’s second-largest power producer, giving China a major foothold into the energy sector.

1MDB announced its plans in February last year to unwind its assets after it drew criticism from lawmakers for accumulating about RM42 billion (S$13.9 billion) in debt in its less than five years of existence.

These acquisitions made China Malaysia’s largest foreign investor in 2015, helping ease Mr Najib’s concern over the firm’s mounting debt.

He chaired 1MDB’s advisory board until recently.

Malaysia’s China push comes amid strained ties between Putrajaya and Washington, after the US Department of Justice filed lawsuits linked to a money-laundering investigation into 1MDB.

Mr Najib has dismissed foreign interference in Malaysia’s affairs and questioned why the US publicised the issue.

“The lawsuits were a strategic mistake by the US ... China will look at this situation with glee,” said a person familiar with the matter but not authorised to speak to the media.

Dr Ian Storey, senior fellow at Iseas-Yusof Ishak Institute think-tank, said there would not be a Duterte-style about-turn in Malaysia’s foreign relations under Mr Najib.

But the 1MDB case “might temporarily nudge Malaysia closer to Beijing and introduce a bit of turbulence in its relations with Washington”. AGENCIES