The evloution of Malaysia-China relationship

IntroductionAfter Cold War, the introvert China shows more interest in developing relation with other countries. Thus, China first builds its relationship with Southeast Asian countries including Malaysia. The China and Malaysia’s relationship officially starts in 1974 that acts as the turning point to a better relationship in various field for both side. The great relationship between both countries does not achieved easily but also with some challenging issues along the road. These include the challenges during the different ideologies upon cold war, the Asian financial crisis and the China threat theory towards worldwide. But these challenges doesn’t harm this relationship, instead it keep growing and maintain a stable bilateral-relationship.

So, further in this report we will discuss about the evolution of China-Malaysia relationship from 1974 (after cold war) until now that witnessed the development in the political, economic and cultural fields.

1.(1970s) AFTER COLD WAR

After the Cold War, China has shown more concerns on the surrounding countries relationship and taken real actions to improve it. Despite the communism issues of China during the cold war, Malaysia accepts China as the country starts to show interest in developing external relations.

The open-door foreign policy by China officially sets the starting point for the bilateral relationship for both countries in 1974. Malaysia’s post-Cold War China policy is desired to be one of the part of the smaller state to gain economic and diplomatic benefits from a closer relationship with China as the great power. Thus, for the sake of economic and political benefit, both countries continued to grow during Mao Zedong and Tun Abdul Razak bin Haji Dato’ Hussein in the 1970s.

Since the establishment of diplomatic ties in 1974, bilateral economic and trade relations have developed considerably. For example, in the economic aspect, during the first stage, rapid economic development can be seen in the overall expansion in trade.

The value of trade doubled within the first five years, but thereafter fluctuated between $300 and $400 million when the world economy suffered a recession. However the frequent exchange of visits of trade representatives from both sides and a series of trade agreements on imported rubber and rice gave a powerful push to the development and balance of bilateral trade during the years between 1975 and 1979. These ups and downs of economic trade continued throughout 1970s.


In the 1980s, both countries starting to look forward towards modernization and the only way to achieve a great modernization development is through economic stability. For China, since the death of Mao Zedong, in 1980’s Deng Xioping often highlighted the priority to approach modernization through economy through foreign policy. While in Malaysia, with quite similar situation, during Mahathir Mohamad’s era also looking forward for economic development through its Look East Policy.

This policy plays a great role in bringing both countries closer together. In November 1985, following the visit state of Malaysian Prime Minister Dr. Mahathir to China, agreement was subsequently reached on a series of economic issues. The Agreement on Avoidance of Double Taxation was signed in 1985, followed in 1988 by agreements on shipping, air services, trade and investment protection, and the establishment of economic and trade committee.

These agreements served as strong stimulants to Sino-Malaysian economic relations. Both China and Malaysia followed an independent foreign policy, and insisted on co-operation among countries on the basis of equality, opposed foreign interference in internal affairs, and supported each other in international issues further promoted the development of mutual political trust and friendly ties.

It was therefore almost a matter of policy that relations on the economic front would advance and broaden further where in 1980s-2000s we would be able to see the mass development of the great relationship from both countries by visiting each other many aspects such economic, politic, cultural, education, international affairs and more.


As for current situation, Malaysia’s post leader after Mahathir Mohammad that is Abdullah Ahmad Badawi and Najib Tun Razak, Malaysia has continued to pursue a policy of dualism vis-à-vis China. Malaysian Prime Minister Datuk Seri Abdullah Ahmad Badawi visited China and held talks respectively with President Hu Jintao, Chairman Wu Bangguo of the NPC, Premier Wen Jiabao and Vice Premier Huang Ju, in 2003. While in 2004, 2004, Chairman Wu Bangguo of the Standing Committee of the NPC met with House Speaker Tan Sri Mohammed Zahir Ismail who came to China to attend the annual session of the Asia-Pacific Parliament Forum.

Both sides reached important consensus on strengthening bilateral relations, agreed to boost strategic cooperation between the two countries and identified the direction to deepen bilateral relations, thus brought relations between the two sides to a new level, injecting new vitalities in cooperation in various fields of both countries. The series of agreements signed by the two countries during these visits are:

1.Memorandum of Understanding between the Government of the People’s Republic of China and the Government of Malaysia on Cooperation in the Field of Foreign Affairs and International Relations Education 2.Memorandum of Understanding between the Government of the People’s Republic of China and the Government of Malaysia on Cooperation in the Field of Public Health and Plant Health 3.Memorandum of Cooperation between China Mayor Association and Malaysia China Business Council.

As for the Malaysian Prime Minister after Abdullah Badawi that is Najib Abdul Razak also keeping the track relation with China using the foreign policy left since Mahathir’s era. Najib stated that he will maintain the continuity of Malaysia’s friendly attitude towards China in various aspects. Thus, he aimed to create business opportunities for Malaysian companies in China and provide impetus of growth for the Malaysian economy.

These include agreements to increase and diversify bilateral trade and deals to increase investment flows from Malaysia to China and vice versa. For example, Najib also aims to take advantage of China’s “go global” economic strategy by encouraging Chinese companies to invest in Malaysia.


Rapid industrial expansion is turning China into an enormous market for resources and raw materials of all kinds. Malaysia is rich in such resources as natural rubber and palm oil, petroleum and timber that are in great demand in China.

On the other hand, China produces large quantities of clothing and textiles products, light industrial goods, and selected agricultural goods that may satisfy Malaysian demand. With a very large population, China has abundant labour resources for the production of labour-intensive manufactured goods, though it is now seriously developing heavy and “high-tech” industries. On the other hand, Malaysia with its higher per capita income is in a better position to take advantage of capital-intensive industrial production.

These have contributed to the development of intra-industry trade and strengthening bilateral investment from the 1990s. Here in economic trade, even though there is some imbalance trade, but overall I can say that Malaysia and China meets each other’s needs and creating a win-win situation. Malaysia has been China’s top trading partner in ASEAN for five consecutive years since 2008, with bilateral trade hitting a record high of nearly $95 billion in 2012. As for now, China remain as one of the top trading partner for Malaysia as shown in the graph below.


Politically, Malaysia and China both adopt similar standpoints when participating in multilateral cooperation organizations of different spheres, such as the United Nations, the World Trade Organization, the Asia Pacific Economic Cooperation organization, etc. It is notable that both countries collaborate with other members of ASEAN in pushing forward the negotiations of establishing China-ASEAN Free Trade Area, actively promotes the liberalization and facilitation process of trade and investment. These multidimensional cooperation in various spheres not only furnished wider ranges of institutional guarantee for both side to participate in activities in the international society, but the achievements of these cooperation also directly boosted the rapid development of bilateral relations.


In cultural exchanges, the two countries signed agreements on mutual recognition of higher education experience and academic degrees in 2011, which will further promote cooperation between their higher educational institutions as well as people-to-people exchanges between Chinese and Malaysian young people. More than 2,500 Malaysian students study in China and there are more than 10,000 Chinese students in Malaysia.

Strengthened youth exchanges will greatly promote bilateral mutual understanding and trust. Not only that, tourism sector also boosted up when Malaysian Tourism Minister Ng Yen Yen says there are 1.25 million tourist from China coming to Malaysia in 2011. Thus, the ministry expects the target of 1.5 million tourists in 2012 and two million for the Visit Malaysia Year 2013/2014. Other than that, China and Malaysia have shelved their disputes over maritime sovereignty, given full play to the complementary advantages of the Qinzhou and Kuantan industrial parks, and are strengthening cooperation in harbors, industry, logistics and shipping to promote regional connectivity.


As we have discussed above, we can clearly see that Malaysia and China both side tries as possible to maintain good relationship. And thanks to the good relationship between the two governments and extensive people-to-people contacts and exchanges, bilateral relations are now at the best period of development in history. However, with the analysis I have done, in my opinion, I wouldn’t say that this relationship only brings positive side only. Like any other foreign relationship, there must be pro and cons from both side. As for this relationship, the great economic and military power of China does gives threat to all small countries in Southeast Asia and the tendency for China to force regionalism is possible.

Plus the However, in order to maintain the stability of this relationship, Malaysia takes this as a ‘NO CHINA THREAT’ as compared to other countries who would consider China as a threat to them. In any bilateral or multilateral relationship, trust is an important key to maintain a good relationship. Thus, Malaysia’s decision to just giving the priority to regional economic development and strategic cooperation and keeping calm in dealing with territorial disputes over some islands and reefs in the South China Sea is undoubtedly a good decision.

Despite all the conflicts between countries, including Malaysia and China as long as both governments could treat them seriously, take effective measures, create conditions for the normal contacts between the two countries, these unpleasant episodes wouldn’t bother the regular developments of bilateral relations. Malaysia-China relationship is actually a really potential bilateral relationship that should be brought to further high-level contact. I hope that strategic cooperation between China and Malaysia can help boost China’s overall relationship with ASEAN.

China-Malaysia relations are solid and reliable. In the future, bilateral relations will become even more comprehensive, stable, and pragmatic, and further promote not only China-Malaysia but also China-ASEAN cooperation.