Malaysian infrastructure projects remain shelved following Mahathir’s China visit

Malaysian Prime Minister Mahathir embarked on his state visit to China with the aim of shoring up relations between the two countries, which appeared strained after Mahathir’s cancellation of China-backed infrastructure projects. With the five-day visit concluding on Monday, the diplomatic overtures indicate that he was successful, despite the project cancellations not being overturned.

As reported in CNN, Mahathir had toned down his anti-China rhetoric in the lead up to the trip, during which he stressed that Malaysia could learn from China and hoped to increase trade and investment between the two nations, especially in the tech and e-commerce sectors.

China agreed that it would maintain its friendly stance towards Malaysia and import more from the country, especially in agriculture. Overall 5 MOU’s were signed on agriculture, agri-commodities and finance.

However, a key point of interest was the foreign-backed infrastructure review that Mahathir heralded in his first 100 days in office, as Ed Ratcliffe, Head of Research and Advisory at Asia House, outlined in The Diplomat. Commentators waited to see if progress could be made in getting these projects back on track.

At the end of the trip Mahathir said that the two large infrastructure projects (the East Coast Rail Link and the natural gas pipelines) are still cancelled, and will be until Malaysia can afford them. This reflects Mahathir’s efforts to ascribe the cancellations to Malaysia’s financial position, not anti-Chinese sentiments.

He was quoted by Channel News Asia as saying, “I believe China itself does not want to see Malaysia become a bankrupt country.”

Pressed on whether the projects are cancelled or deferred, Mahathir said they had been cancelled outright, but added that they may be deferred. He was quoted by the South China Morning Post several times as blaming the previous governments ‘stupidity’ for the deals.

In the press conference after his meeting with Chinese Premier Li Keqiang, Mahathir said that Malaysia doesn’t want a “new version of colonialism” where poorer countries can’t compete with rich countries.

This pointed expression highlights some Asian nations’ unease about China’s growing influence in the region and is a sign that Mahathir will continue to push for fair trade alongside free trade.