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The 21st Century Maritime Silk Road and China-Malaysia Relations
2017-03-11 15:45

The 21st Century Maritime Silk Road and China-Malaysia Relations

By

Mr Shahriman Lockman

Senior Analyst, Institute of Strategic and International Studies(ISIS) Malaysia

shahriman@isis.org.my

Dialogue on China-Malaysia Relations:

Strengthening Partnership, Deepening Regional Cooperation

Tuesday, 14 April 2015

International Conference Hall

Chinese People’s Institute of Foreign Affairs (CPIFA)

 

Distinguishedguests, ladies and gentlemen,

At theoutset, allow me to thank the Chinese People’s Institute of Foreign Affairs(CPIFA) for this opportunity to visit China and engage in discussions withleading Chinese scholars and officials. Special thanks go to Ambassador PengKeyu and his colleagues, especially Mr Han Hongchai, Mr Hong Shuzhan and Ms WenXiangdong. Their hard work and efficiency have been exemplary.

Ishould also emphasise that my presentation reflects my own views and not thoseof the Institute of Strategic and International Studies (ISIS) Malaysia or theMalaysian Government.

Thetopic that’s been assigned to us in this session is “The 21st Century MaritimeSilk Road and China-Malaysia Relations.” I will attempt to address the twomajor themes of this topic as best I can, while leaving enough time for my moredistinguished colleagues to contribute their thoughts.

KeyFeatures of Malaysia’s Foreign Policy

Butfirst, let me highlight several key features of Malaysia’s foreign policy thatare worth bearing in mind as we discuss Malaysia-China relations and the 21stCentury Maritime Silk Road. There will be no time for a comprehensive treatmentof all the key features of Malaysia’s foreign policy. So for the purposes oftoday’s discussion, I’d like to highlight three, in particular.

Thefirst feature is an intense focus on international trade. This is not to saythat other economic aims do not matter. Attracting foreign investments is alsoa major priority for Malaysia. But there are few other objectives that can soreliably focus people’s minds, affect policy calculations, and propelgovernment action like international trade.

Thisshouldn’t be surprising. After all, Malaysia is one of the most trade dependentcountries in the world: it is 154% of our GDP. But being a trading nation isnot just an economic reality for us; it is also a matter of national identity.Being a trading nation is a big part of who we are.

Thesecond feature of Malaysia’s foreign policy is a strong commitment towards theAssociation of Southeast Asian Nations (ASEAN). ASEAN is regularly described asthe cornerstone of our foreign policy: not just “acornerstone” – which implies that there’s more than one – but “the cornerstone.” This is not theresult of some sentimental attachment to a regional organisation that Malaysiaplayed a pivotal role in establishing in 1967. Rather, Malaysia’s commitment isanchored on the clinical and realistic calculation that our prosperity andsecurity are invariably tied to a strong and successful ASEAN.

That iswhy Malaysia takes its chairmanship of ASEAN in 2015 very seriously. For thisyear will be a test of ASEAN’s ability to live up to its goal of creating anASEAN Community. Like it or not, the ASEAN Community will be declared on 31December 2015. The challenge here is to give it meaning and substance, both inthe lead up to its announcement and the years after. The ability of ASEANMember States to act cohesively, in unison, and in ASEAN’s interests as a wholewill be crucial towards making the Community a success.

The thirdfeature of Malaysia’s foreign policy is a keen awareness and appreciation ofits strategic location and geography. Napoleon is thought to have said that:“to know a nation’s geography is to know its foreign policy.” Malaysia is nodifferent.

Ourstrategic location presents both benefits and risks. Being situated astride theMalacca Strait allows us to tap into the economic potential and advantages ofhaving over 80,000 vessel movements through that busy waterway each year. Atthe same time, Malaysian policymakers are conscious of the fact that thestrategic importance of the Malacca Strait and the South China Sea carry thepotential of attracting the contesting interests of the major powers. In otherwords, Malaysia is situated in an area that’s ripe for majorpower rivalry.

A majorconsequence of Malaysia’s strategic geography is an enduring interest inseeing: first, that no major power dominates Southeast Asia; and second, thatSoutheast Asia does not become a region for contestation between the majorpowers. These were the objectives that underpinned Malaysia’s push forSoutheast Asia to become a Zone of Peace, Freedom and Neutrality (ZOPFAN) inthe early 1970s. It is only by ensuring that the region isn’t dominated by amajor power or become an arena for major-power rivalry that Malaysia and itsSoutheast Asian neighbours stand a chance of maintaining their autonomy.

Malaysia-ChinaRelations

Moreoften than not, the news headlines about Malaysia-China relations are dominatedby how the two countries are major trading partners. In 2014, total bilateraltrade reached US$106 billion. China is Malaysia’s biggest trading partner.Malaysia, on the other hand, is China’s third-biggest trading partner in Asiaand its biggest among all ASEAN countries. The aim now is to have US$160billion in bilateral trade by 2017.

But weall know that the relationship between Malaysia and China is more than justabout trade. In October 2013, Prime Minister Dato’ Sri Najib Tun Razak andPresident Xi Jinping agreed to elevate the bilateral relationship to aComprehensive Strategic Partnership. Last year, the two countries celebratedthe 40th anniversary of diplomatic relations. Prime Minister Najib andPresident Xi have met four times in their current capacities: once in 2013,twice in 2014, and more recently at the sidelines of the Boao Forum for Asia inHainan last month.

By mostaccounts, Prime Minister Najib views Malaysia-China relations not only in termsof dry calculations of interests. Rather, he also sees the building of therelationship with China as a continuation of the legacy of his late father, thesecond Prime Minister of Malaysia, Tun Abdul Razak.

Underpinningthis approach is an overwhelmingly positive perception of China among theMalaysian general public. In the Pew Global Attitudes survey released lastJuly, 74% of Malaysians were reported to have expressed positive views aboutChina. The only two countries where more people were positive about China werePakistan and Bangladesh.

But aswith any relationship between two countries, there are challenges. I’m surethat my fellow Malaysian delegates can highlight a number of areas where therelationship could be better. I’d like to mention two. The first is thechallenge of creating a more balanced economic relationship, particularly interms of investment. Currently, the ratio between Chinese investments inMalaysia and Malaysian investments in China is approximately one to six. So,for every dollar of investment by Chinese entities in Malaysia, their Malaysiancounterparts have six dollars in China. Having some semblance of a balance inthe economic relationship between Malaysia and China is important to ensurethat it continues to be viewed as one with mutual benefits.

Thesecond challenge involves the South China Sea. Unlike some of the otherSoutheast Asian claimants, Malaysia has decided that the most constructive wayof engaging China on this issue is through quiet diplomacy. There remainsconfidence in this approach, which seeks to avoid the excessive glare of themedia on an issue where nationalist sentiments can easily be inflamed.

Butthere are growing concerns, including as a result of China’s reclamation andconstruction activities in the South China Sea. I do not wish to go into themerits or demerits of China’s actions in this regard. To do so would be afutile exercise and occupy needless attention in a dialogue where we should belooking for ways to improve the relationship. All I wish to highlight is a newreality: that the reclamation and construction activities in the South ChinaSea will inevitably bring the operations of Chinese and Malaysian maritimeforces into even closer proximity.

In therecent past, Malaysia and China had – by and large – the luxury of geographicaldistance. As a result, the South China Sea issue has been mainly kept withinthe confines of deliberations by our political leaders and diplomats. But thegrowing frequency of contact between our respective navies and coast guards inthe South China Sea adds a new dimension to the relationship. It increasinglyexposes bilateral ties to the occasional need for quick decisions and thepossibility of miscalculations by those commanding the ships on both sides.This is one of the reasons why it is crucial for all the countries concerned toreach an agreement on a set of minimum standards of behaviour in the SouthChina Sea: a Code of Conduct (COC).

 

Malaysia’sResponse to the 21st Century Maritime Silk Road

PresidentXi Jinping’s announcement of the 21st Century Maritime Silk Road initiative inOctober 2013 prompted a great deal of interest throughout the region – Malaysiaincluded. It also led to a series of visits to Malaysia by Chinese delegationsthat wanted to gauge our perceptions of the initiative. Some of those delegationsvisited the think-tank where I work, ISIS Malaysia.

Unfortunately,neither we nor our Government colleagues were able to provide comprehensiveanswers to many of their questions. But nor could the Chinese visitors answermany of ours. And that was mainly because of a lack of detailed informationabout the initiative. This persisted for over a year following President Xi’sannouncement.

What wecould tell them was that the Malaysia-China Kuantan Industrial Park and theKuantan Port had the potential to become key parts of the initiative.

We alsoknew that, even without a formal initiative by the Chinese Government,something approximating what is envisaged under the 21st Century Maritime SilkRoad was going to happen anyway – perhaps on a smaller scale and moregradually. Economic imperatives alone would dictate that, in response to thesheer magnetism of the Chinese economy, a series of ports and relatedfacilities would be built along the coasts of Asia, Africa and Europe – with orwithout a grand, overarching plan to do so.

We alsoconsidered the possibility that the 21st Century Maritime Silk Road initiativecould raise concerns in Southeast Asia. We asked: Is there a possibility thatthis initiative might accelerate the speed with which some ASEAN Member Statesare being pulled towards the strategic space of one major power or the other?What are the possible implications for ASEAN’s cohesiveness? Might this lead –perhaps as an unintended consequence – to China’s dominance of Southeast Asia?

Even inthe absence of detailed information, however, the Malaysian Government’sreactions to the initiative were largely positive. Cooperation in theestablishment of the 21st Century Maritime Silk Road was incorporated into theJoint Communiqué between Malaysia and China in conjunction with the 40thanniversary of diplomatic relations in May 2014. The Malaysian TransportMinister, Dato’ Sri Liow Tiong Lai, has repeatedly expressed Malaysia’s supportfor the 21st Century Maritime Silk Road. Earlier this year, followingdiscussions with his Chinese counterpart, the Minister said that Malaysia’srecommendations had been incorporated into the plan for the initiative. Andlast month, Prime Minister Najib reiterated that Malaysia supported theinitiative in principle and was getting further details from China.

Nowthat China has released its Vision and Action Paper on the “One Belt, One Road”initiative, we can have a better appreciation of what it is about. 6 China hasclearly sought to consider the interests of the various countries that will beinvolved in the 21st Century Maritime Silk Road, including those in SoutheastAsia. The time that it took to formulate this paper was obviously not wasted.

What’sespecially noteworthy is the care with which the paper seeks to emphasise andre-emphasise that the 21st Century Maritime Silk Road will be a collaborativeendeavour. This began with its title, “Vision and Actions on Jointly Building Silk Road EconomicBelt and 21st Century Maritime Silk Road.” It continues with a set ofprinciples that underscore that the initiative is open for cooperation;harmonious and inclusive; follows market operation; and seeks mutual benefit.It follows up with further details aimed at addressing the concerns of China’spartners. What I found especially comforting was that the paper reflected anunderstanding that for the 21st Century Maritime Silk Road to succeed, thebenefits must flow both ways.

Conclusion

I donot speak for the Malaysian Government. My Prime Minister and his cabinetministers have said that Malaysia is in principle supportive of the 21stCentury Maritime Silk Road.

But Iwould urge that the interests of Malaysia and of ASEAN as a whole are alwayscarefully taken into account in the implementation of this initiative. As atrading nation, Malaysia will almost certainly be a strong and enthusiasticpartner in the 21st Century Maritime Silk Road. But I should also underscorethat Malaysia views the unity and cohesiveness of ASEAN and a Southeast Asiathat’s free from major-power dominance and rivalry as matters of majorstrategic importance.

As arising power, China has a duty to reassure the rest of the region and theworld. It has largely done that with finesse and sophistication. MostMalaysians, myself included, are confident that it will continue to do so inthe future.

Thankyou.  



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