During Premier Li Qiang’s visit to Malaysia to celebrate 50 years of diplomatic relations, the two countries signed multiple trade and economic agreements. Malaysian durians will soon be exported to China, thanks to a new five-year deal for economic and trade cooperation. This agreement aims to strengthen connections between industries in key sectors such as high-level manufacturing and the digital economy. Additionally, a protocol was signed to facilitate the export of fresh durians from Malaysia to China. Durians are a unique tropical fruit known for their distinctive odor and creamy pulp.
Malaysia is set to tap into the Chinese market by exporting fresh durians, following the success of selling durian pulp and paste since 2011 and frozen whole fruits since 2018. The export value of frozen durians from Malaysia to China has witnessed a significant increase, from 170 million ringgit ($36 million) in 2018 to nearly 1.2 billion ringgit ($255 million) in the previous year.
Chinese Premier Li, the first to visit Malaysia since 2015, arrived for a three-day visit after his trip to Australia. Welcomed with a red carpet, Li emphasized that the 50-year anniversary of the two nations marks a new beginning to strengthen ties and enhance exchanges. In a statement published by the national Bernama news agency, Li expressed China’s readiness to collaborate with Malaysia.
As China’s second-highest-ranking official, Li’s recent visits to New Zealand and Australia were the first by a Chinese premier in seven years.
While the main focus of the talks was on trade, the issue of territorial claims in the South China Sea was also brought up. According to China’s Xinhua news agency, the two leaders agreed that China and the Southeast Asian countries involved should address the maritime dispute through dialogue, cooperation, and bilateral settlement. No specific details were provided, but this statement comes at a time when there are concerns about the potential escalation of the sea row, which could lead to a larger conflict between the U.S. and China. This concern arose after a recent confrontation between Manila and Beijing, where Chinese forces seized two Philippine boats and injured Filipino navy personnel who were delivering food and supplies to a disputed shoal. In response, the U.S. reiterated its commitment to defending its treaty ally, the Philippines.
Vietnam, Brunei, Malaysia, the Philippines, and Taiwan all challenge Beijing’s claims to the majority of the South China Sea. Despite Chinese coast guard ships sailing near Malaysia’s waters, the Malaysian government prefers diplomatic channels and rarely criticizes Beijing. This approach is driven, in part, by the desire to protect economic ties with China, which is Malaysia’s top trading partner since 2009.
Additionally, other agreements signed between Malaysia and China aim to promote investment in the digital economy and sustainable development, combat transnational crime, and enhance housing, urban development, higher education, science and technology exchanges, tourism, and cultural cooperation. According to Anwar’s office, these agreements reflect the diverse areas of collaboration between the two countries.
Trade with China is of significant importance to Malaysia, representing 17% of the country’s global trade and valued at $98.8 billion last year, as stated by Trade Minister Zafrul Aziz in a report by Bernama last week.
Anwar, who made two visits to China last year, has been actively seeking closer ties with Beijing while also maintaining a strong alliance with the United States. During a forum in Tokyo in May, Anwar emphasized the significance of China, highlighting its proximity, importance, and strategic value.
Prior to Li’s visit, Anwar informed Chinese media that Malaysia intended to join the BRICS bloc, a group of developing economies. However, no specific details were provided at that time. On Monday, Malaysian officials confirmed the plan. The BRICS bloc, consisting of Brazil, Russia, India, China, and South Africa, aims to establish a more equitable global order that is currently dominated by Western nations. The bloc has recently expanded, with Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates being invited to join as members this year. Additionally, around 40 countries have expressed interest in joining the bloc.
According to James Chin, a professor of Asian studies at Australia’s University of Tasmania, joining BRICS does not mean Malaysia will have to choose between Beijing and Washington. It simply provides an additional platform for Malaysia to have a stronger influence as a middle power.
During Li’s visit, he also met with King Sultan Ibrahim Iskandar and together with Anwar, they initiated the construction of a terminal station for the East Coast Rail Link. This rail link connects Malaysia’s west coast to rural eastern states and is an important part of China’s Belt and Road infrastructure initiative.
During the ceremony, Li mentioned that this railway project is the largest transportation infrastructure project undertaken by a Chinese company overseas. Once completed, China is willing to collaborate with Malaysia to develop projects along the railway line, which will boost commerce, logistics, and tourism. Li also suggested the possibility of connecting the rail line to Thailand and eventually to southern China.
In 2018, the project was put on hold following the historic general election in Malaysia, which led to the downfall of the long-ruling coalition due to a significant corruption scandal. However, the project was later reinstated after the Chinese contractor agreed to reduce the construction cost by one-third. It is now expected to be finished by the end of 2026.
Additionally, the two leaders will participate in a dinner to commemorate the 50th anniversary of diplomatic relations. Prior to Li’s departure on Thursday, both leaders will also engage with the business community during a luncheon.