Between Scylla and Charybdis? – Emerging New Malaysia and Its Enigmatic Relations with China

Abstract

Critics have long pointed out a worrying trend in Southeast Asia, while not limited to the region alone, which has emerged along with the rise of China that in exchange for economic favours the countries in this region are risking their policy autonomy in falling into overdependence on China. The Chinese government’s close relations with some of the most authoritarian and kleptocratic regimes of the region, where the Belt and Road Initiative (BRI)-related investments have made the most significant inroads, have raised the fear for a China factor in these regimes’ suppression of dissent, civil liberties and political freedom. In Malaysia, with the ousting of the long-ruling National Front coalition in the 9th May 2018 general elections, a vibrantly anti-graft New Malaysia has been widely perceived to have emerged under the new Alliance of Hope coalition government that has immediately made good on its election promise of rescrutinizing the previous government’s dubious China deals with “unequal” terms perceived to be linked to the previous administration’s 1MDB “scandal of the century” and proceeded to cancel several extravagant infrastructural projects that included among others the East Coast Rail Link (ECRL) that would result in the country’s over-indebtedness to China and turn the country into a pawn in the advancement of China’s ambitious regional agenda at the expense of Malaysia’s own national goals. Such bold moves, however, have expectedly soured Malaysia-China relations as well as put certain parts of Malaysia’s new coalition government’s domestic electoral support base at risk. However, in recent months the new government has incredibly pulled off a tour de force by successfully renegotiating with China and relaunching the ECRL at a much lower cost – an achievement on which economics Professor Panos Mourdoukoutas thus commented, “In dealing with China, Malaysia has dared to do something Sri Lanka, Pakistan, and the Philippines didn’t – bring Beijing back to the negotiating table to cut the cost of the investment projects assigned to Chinese contractors”, in this case the ECRL that he described as serving the interests of Beijing more than the interests of Kuala Lumpur. With this turn of events several other China-linked infrastructural projects that have also been shelved by the new Malaysian government are expected to also be brought back to negotiation table for possible relaunching on more “equal” terms, while New Malaysia’s prime minister Mahathir Mohamad went to Beijing to announce his full support for BRI at the 2nd Belt and Road Forum for International Cooperation (BRF) held in late April 2019. This paper will attempt to analyze such recent development in post-May 2018 Malaysia-China relations by focusing on the sometimes enigmatic relationship between the two countries which seems to be now rapidly reconfiguring itself after the emergence of a New Malaysia, in both the contexts of international geopolitics and domestic political economy.

Keywords: Malaysia, China-Malaysia relations, rise of China, Belt and Road Initiative (BRI) in Malaysia, 1MDB scandal