New reliance on Chinese-funded projects sparks concern

Malaysia has welcomed untested, exported Chinese education in the form of Xiamen University Malaysia.
Malaysia has welcomed untested, exported Chinese education in the form of Xiamen University Malaysia. PHOTO: THE STAR/ASIA NEWS NETWORK

The campus is not quite completed yet but China's first overseas university, being built on a massive 61ha area, has already enrolled 1,300 students for its first year of operation.

Encouraged by its early success, Xiamen University Malaysia near the administrative capital Putrajaya expects to complete the first phase of construction, costing RM800 million (S$258 million), by early next year, before another RM500 million is invested to further building for a maximum capacity of 10,000 students.

It appears that Malaysia welcomes untested, exported Chinese education as warmly as it embraces hundreds of billions of ringgit in planned incoming investments from the Asian superpower. Not that it has many options - Chinese interest comes even as total private investments into Malaysia fell by 30 per cent in the first half of 2016.

Prime Minister Najib Razak last month returned from a week-long trip to China after sealing RM144 billion worth of projects, sparking diplomatic concern about Kuala Lumpur's new tilt towards Beijing and away from Washington.

The concern is over how this new dependence on China may impact Malaysia's response to Beijing's adventurism in the region, particularly in the disputed South China Sea.

"The danger of economic overdependence on China for Malaysia is that Beijing can leverage that," said S Rajaratnam School of International Studies' (RSIS') Johan Saravanamuttu, who studies Malaysia-China relations.

For his part, Datuk Seri Najib has denied he is "selling out" the country to China, even as the list of mainland Chinese projects in Malaysia grow longer: an upcoming port, a new rail line and investments in the giant Bandar Malaysia township and power plants.

"Some have scaremongered that Malaysia is being sold off. This is absurd and absolutely false," he said in a statement soon after the China visit.

Analysts say Mr Najib, burdened by graft accusations involving state fund 1Malaysia Development Berhad (1MDB) that have included claims from the United States, and a slowing economy, has signalled that Malaysia is "open for business", especially in the wake of deals made on the Beijing trip.

Additionally, US-Malaysia political ties could change under the incoming administration of Mr Donald Trump. "Trump is not into all these overseas ventures. He wants to focus on the US economy," RSIS Institute of Defence and Strategic Studies' senior fellow Oh Ei Sun told The Straits Times. The Philippines, under President Rodrigo Duterte, has also shown a higher inclination to listen to Beijing.

The message being projected is that the more established Asean partners like the US and Japan can do more, analysts say. Assistant Professor of international politics at the Philippines' De La Salle University, Mr Richard Javad Heydarian, wrote that South-east Asian nations are seeking "to maximise their own room for manoeuvre" as they are "uncertain about the US' commitment to the region".

"Kuala Lumpur (has) sought direct engagement rather than confrontation with the Asian powerhouse over the South China Sea disputes," he said.

Japan last month scrambled together a gift of two large patrol vessels to beef up Malaysia's maritime patrols, an overture made during bilateral talks between Japanese Prime Minister Shinzo Abe and Mr Najib, which the latter pointedly remarked would promote stability in the South China Sea.

A Japanese diplomat told The Straits Times the decision had been in the offing but was "accelerated when the visit was confirmed", especially as it came just weeks after the "political investment" that Beijing made in the Najib administration.

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A version of this article appeared in the print edition of The Straits Times on December 22, 2016, with the headline New reliance on Chinese-funded projects sparks concern. Subscribe