PM Anwar Says Malaysia Secured Nearly $39B In New Chinese Investment

By Ili Shazwani

Anwar Ibrahim’s trip to China last week resulted in nearly U.S. $39 billion in new investment, and the two nations’ leaders discussed reducing Asia’s dependency on the U.S. dollar, the Malaysian prime minister said Tuesday. 

Anwar’s comments in parliament shed new light on the state visit last week in which he agreed to negotiate over oil and gas exploration within Malaysia’s 200-mile exclusive economic zone, after China’s leader expressed concern about it during bilateral talks.

“The total investment secured from China is 170.07 billon ringgit, the highest investment achieved by Malaysia so far,” he said in reply to a question in Parliament about his four-day trip to China last week.

“[Chinese] Premier Li Qiang and I decided against entertaining nine other proposals as they did not include specific planning or a time frame for launching by this year or at least year’s end. Those we have decided upon are being monitored by [our] governments.”

Of the total Chinese commitment, an estimated 80 billion ringgit ($18 billion) would be invested by China’s Rongsheng Petrochemical into a refining facility in the southern Malaysian state of Johor. 

China’s Zhejiang Geely Holding Group is to invest 2 billion ringgit ($454 million) initially, ramping up to 32 billion ringgit ($7.2 billion), as part of its collaboration with Malaysian carmaker Proton.

Other potential investment areas that MOUs were signed for include green technology, digital economy, and electronics and electrical manufacturing.

Anwar, who also serves as finance minister, told Parliament that Chinese President Xi Jinping welcomed his idea of setting up an Asian Monetary Fund to reduce the region’s reliance on the U.S. dollar and the International Monetary Fund (IMF).

“[W]ith the strength of the economies of China, Japan and others, I think we should discuss this … at least consider an Asian Monetary Fund, and, secondly, the use of our respective currencies,” Anwar said.

“There is no reason why countries like Malaysia need to continue being dependent on the U.S. dollar, as during negotiation between Malaysia and Indonesia we can use both ringgit and rupiah.” 

Similarly, he said: “The [Malaysia] central bank is currently putting in efforts to enable the country to negotiate import and export matters [with China] using the ringgit and renminbi.”

‘Petronas will proceed’

Anwar on Tuesday elaborated on comments from a day earlier when he said Malaysia informed China it was open to negotiations on the South China Sea dispute between the two nations.

Anwar said the issue of the disputed waterway came up when China brought up Malaysian state petrochemical firm Petronas’ offshore work. 

“China was concerned as Petronas is carrying out activity at a large scale on the territory which was also claimed by the country [China],” Anwar said in Parliament. 

“I mentioned the matter to Premier Li Qiang and President Xi Jinping, explaining that Malaysia considered the area as part of its territory, hence Petronas will proceed with the excavation work there.”

Anwar added: “However, should China feel that they have the rights to the area, we could discuss and negotiate the matter, but in the meantime our excavation efforts will continue.”

Anwar didn’t specify which project work was being referred to, although the Kasawari project off the coast of Sarawak and southeast of the Luconia Shoals is seeing activity as it is slated to begin production this year, according to a Washington think tank.

The Asia Maritime Transparency Initiative (AMTI) at the Center for Strategic and International Studies (CSIS) in Washington noted that the China Coast Guard vessel CCG 5901 arrived at Luconia Shoals on Feb. 17 and as of Thursday was still there.

Anwar said Malaysia would take appropriate action if necessary.

“On the presence of Chinese ships [in Malaysian waters], China explained that it was in international waters but the Foreign Ministry will continue to monitor and if there is a collision, we will file a protest,” Anwar said in Parliament.

A Chinese Foreign Ministry spokeswoman was asked about this at the ministry’s daily briefing.

“China is firmly committed to safeguarding our lawful rights and interests in the South China Sea. At the same time, we are ready to work together with the Malaysian side and continue to properly handle maritime disputes through dialogue and consultation,” spokeswoman Mao Ning said.

Meanwhile, Malaysian state news agency Bernama carried excerpts of an interview Anwar gave to a media company in China, during which he reportedly said the South China Sea issue should not be “that contentious,” and dialogue with other Southeast Asian claimant states should be the way to resolve differences.

“I have stated that we have potential for oil and gas in that area, and we have to pursue that area, but the Chinese want to discuss it, so we discuss it,” Anwar reportedly told the Chinese media company, according to Bernama.

“I believe that there is no easy solution to that problem. As we think of each other as friends, we continue to have dialogue. This problem is not insurmountable.”