When the 1MDB scandal surfaced, it was not long before keen-eyed observers suspected a connection with these Chinese projects. For example, most of the money was drawn from the funding accounts for the pipelines when construction had hardly commenced. The suspicion (some claim proof) is that these funds were used to replenish the depleted coffers of 1MDB. Before the election, Mahathir made it clear he was prepared to fully investigate the allegations surrounding 1MDB and that he was highly skeptical concerning the benefits of China’s more grandiose BRI projects in Malaysia, including the railroad deal.
WHEN MAHATHIR first became prime minister thirty-seven years ago, his impact on foreign policy was immediate and dramatic. His “take no prisoners” rhetorical style focused on Britain and the United States with speeches peppered with references to “imperialists” and “racists.” He seemed to take particular delight in insulting the American ambassador in Kuala Lumpur—whomever it was. Shortly after becoming prime minister, Mahathir summoned his foreign minister (inherited from Prime Minister Onn), the redoubtable Ghazali Shafie, and told him to call all of Malaysia’s ambassadors back to the capital so he could meet with them. When they were assembled, Mahathir berated them: “You are all too nice; you are too polite.” He wanted them to be outspoken and provocative. When the Malaysian ambassador entered a room, he wanted everyone there to be on edge, afraid of what he might say. When asked if this was a problem for these diplomats, Ghazali responded, “It was a problem for me! I had friends in London and I was expected to go and spit in their eye. I refused, and I quit!” Mahathir became his own foreign minister and relations with Washington and London, in particular, became distinctly chilly.
Soon after taking office, Mahathir championed a “Look East” foreign policy that looked to Asia, not the West, for a model of modernization. By “East” Mahathir meant Japan, not China. Relations with Beijing were relatively uneventful through Mahathir’s long tenure (coinciding with the Deng Xiaoping-era) because China played a relatively small role in Malaysia’s economic and security calculations at the time.
Those circumstances have, of course, changed dramatically in the years since he left office. As a consequence, Mahathir will have to seriously recalibrate his approach to China and the United States. The choices and decisions facing the new government are reasonably clear. Fundamentally, Malaysia will have to decide whether, and to what extent, it is prepared to resist Chinese pressure and blandishments aimed at creating a sphere of Chinese dominance in the Western Pacific and Southeast Asia.
Kuala Lumpur confronted the question of what to do about the infrastructure deals signed by Najib with China. Mahathir announced that the largest of these—a railroad and two pipelines—have been cancelled. A residential resort project, largely completed, is being reviewed.
Second, Malaysia must decide whether to publicly pronounce on the legality of Chinese claims to sovereign ownership of the South China Sea. The vehicle for such a pronouncement is readily available in the form of the 2016 UN Convention on the Law of the Sea Tribunal judgment that the Chinese claim is without legal merit. So far, Malaysia has shied away from any explicit embrace or rejection of that judgment.
Third, Malaysia will face hard decisions on how to respond to Chinese naval and maritime enforcement deployments within Malaysian-claimed waters of the South China Sea. These include deployments to shoals very near the coast of eastern Malaysia and very far from China.
Mahathir has already signaled a challenge to China insisting that we must “ensure our voice is heard because Malaysia does have islands in the area and this we must uphold.” He went on to note that China’s willingness to “flex its muscles . . . is very worrisome” as is its ability to rapidly “increase its influence over many countries in Southeast Asia without actually conquering them.” Mahathir has already set a very different tone for Malaysian-Chinese relations than his predecessor.
IF MALAYSIA is to become serious about resisting Chinese dominance there is only one place it can turn—the United States. The two countries have a long record of defense cooperation including port calls by U.S. naval vessels, joint military exercises (everything from jungle warfare training to surface naval maneuvers), counterterrorism and counterproliferation cooperation, and ministerial level consultations. U.S. naval surveillance aircraft fly over the South China Sea from a Malaysian naval base on Labuan Island, Malaysian units participate in the multination Cobra Gold exercise, Lockheed Martin maintains a repair depot outside Kuala Lumpur and Malaysian military officers attend U.S. military colleges under international military education and training grants.
Meanwhile, Secretary of Defense James Mattis has authorized a stepped-up U.S. military presence in the South China Sea. Since May 2017, the navy has more than doubled the number of designated FONOPS compared to past years. The number of “ship days” under routine operations increased from seven hundred in 2016 to nine hundred in 2017. Three naval carrier battle groups have conducted operations in the area while the air force has conducted bomber patrols over the South China Sea from Guam and Diego Garcia. In response to what Mattis described as China’s policies of “intimidation and coercion,” the Pentagon withdrew an invitation to China to participate in this year’s Rim of the Pacific Exercise (RIMPAC)—the world’s largest annual multinational naval exercise.
With regard to U.S.-Malaysia military cooperation, it is possible to imagine a good deal more including U.S. Navy cooperation with the Royal Malaysian Navy in the South China Sea (including an increased tempo of ship visits to Malaysian facilities), military sales, more regularized patrols from Labuan and additional visits by senior Pentagon officials to Malaysia. Any or all of these steps would have serious implications for Malaysia’s strategic position regarding both the United States and China. How Donald Trump’s presidency plays into this dynamic is anyone’s guess. Trump and Najib had a golfing friendship and Mahathir is on record excoriating Trump’s decision to move the U.S. embassy in Israel to Jerusalem. It is also worth noting that Anwar, Mahathir’s designated successor, has none of Mahathir’s contentious history with America. He has close ties with a number of U.S. officials and universities, and his first overseas trip since acquiring freedom of movement was not to China; it was to London.
In sum, Malaysia’s political transition has coincided with a rapidly changing and very challenging regional security environment. Malaysia is key to China’s Belt and Road strategy and, under Najib, seemed to have made major inroads there in the form of influence and economic presence—including personal payments to the prime minister. A veteran, strong-willed Malaysian leader with public opinion at his back is now carefully, but unmistakably, challenging those inroads. The implications for U.S. strategic interests are obvious. The senior director for Asia on the National Security Council staff has just visited Kuala Lumpur and other visits will follow shortly. The great game is afoot.
Marvin C. Ott is senior scholar at the Wilson Center and visiting professor at Johns Hopkins University. He is former professor of national security strategy at the National War College, deputy staff director of the Senate Intelligence Committee and senior analyst at the CIA.