Malaysia hopes China will sympathize with its fiscal woes

Elias Hubbard
August 20, 2018

Malaysian Prime Minister Mahathir Mohamad said on Monday he believed China would sympathise with his country's "internal fiscal problems" as he seeks to renegotiate, or possibly cancel, more than US$20 billion in Chinese-funded projects. "But a good Malaysian will come back and make the country as great as the developed countries they studied in", the PM said, greeted by rousing cheers from the audience.

"We do not want a situation where there is a new version of colonialism happening because poor countries are unable to compete with rich countries", he said. "It must also be fair trade".

"We're here to assure the Chinese government and its people that there will be no change in policy", the prime minister said. Those broader concerns have stoked political tensions from Australia to Sri Lanka, where leaders are grappling with how to balance the need to tap China's largesse without becoming overly dependent on Beijing.

Mahathir is on a five-day official visit to China.

Dr Mahathir said after meeting Chinese Premier Li Keqiang in Beijing he did not believe in confrontation with any country and stressed the benefits Malaysia stood to gain from increased exposure to Chinese trade, technology and entrepreneurship.

Making his first trip to China since his stunning electoral victory three months ago, Mahathir toured the campus of Chinese online shopping giant Alibaba Group in the eastern city of Hangzhou.

Without giving any specifics, Chinese state broadcaster CCTV quoted Xi as telling Mahathir that their nations should "properly handle the existing problems based on the principle of mutual respect and friendly consultation". "I know there are ups and downs, but in relationship between nations, sometimes they are very strong and sometimes they are very weak".

Dr Mahathir noted that Malaysia had had a relationship with China for nearly 2,000 years.

Among the deals signed between the two countries on Monday was a memorandum of understanding on a bilateral currency swap agreement.

China is Malaysia's third-largest export market after India and the European Union.

The People's Daily overseas edition published a front page article by the deputy director of the China Institute of International Studies, Su Xiaohui, which said that despite "repeatedly bad mouthing Sino-Malaysian relations" during his election campaign, Mahathir had clearly welcomed Chinese trade co-operation since taking office.

In July, citing their high costs, Mahathir suspended two China-backed projects worth over $22 billion - the East Coast Rail Link as well as gas pipelines - that were approved by Najib, who had pulled Kuala Lumpur close to Beijing.

In another pointed comment that seemed to allude to the criticism that China was engaged in debt trap diplomacy, Mahathir said on Monday: "We should always remember that the level of development of countries are not all the same".

Other reports by Click Lancashire

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