Why Mahathir’s Look East policy must embrace China

Malaysian Prime Minister Mahathir Mohamad announced that Malaysia is renewing, or to be more precise, upgrading the Look East policy he adopted as a foreign policy 30 years ago.
It was unveiled after he came to power in 1981 and now, as the premier for the second time, he has picked up the pieces of his past and repackaged it. His inclination to Japan then was understandable since the country was the rising star of Asia. Although Look East included South Korea and Taiwan, it basically meant Japan.
I think any Malaysian who has visited Japan can vouch for the people’s work ethic, honesty, orderliness, politeness, punctuality, cleanliness, precision, dedication to excellence, innovation and good manners.
Malaysians in Japan feel safe – they rarely get cheated despite being tourists, which is more than can be said for many countries.
Personally, Japan remains my No 1 holiday destination. Like Mahathir, I have the highest admiration for the Japanese. They are certainly exemplary, and that is indisputable.
Mahathir has continued to have high regard for the Japanese and history seems to be repeating itself.
His Look East Policy shocked and confused the Malaysian foreign ministry, with many officials viewing it as undefined and vague.
The ministry being left in the dark about the prime minister’s move led to it being unaware of how to implement the policy.
Fast forward to 2018. It’s likely that his new batch of ministers were also caught off guard with the revival of the Look East policy, more so when the foreign minister has yet to be installed. Without doubt, Japan is an important partner of Malaysia because we have more than six decades’ ties with the country.
In 2016, Japan ranked Malaysia as its fourth-largest trading partner with bilateral trade standing at 120 billion ringgit (Bt982 billion).The strong trade and investment relations between the nations are also underpinned by the Malaysia-Japan Economic Partnership Agreement.
The latest Malaysia-Japan collaboration includes the Bukit Bintang City Centre project, which has managed to attract the leading real estate group in the Land of the Rising Sun, Mitsui Fudisan Co Ltd, to invest in what will be the mega-project’s 1.6-billion ringgit retail mall.
But Mahathir’s choice of his first foreign visit to Japan as PM raised many eyebrows. Perhaps it was just the coincidental timing of the annual Nikkei Conference, which he attends without fail. I was told that his office had informed the Chinese Embassy here, as a matter of courtesy, to avoid reading into the matter, given the long, bitter rivalry between the two nations. Mahathir was also visiting Japan after a series of announcements, calling for the review, if not cancellation or postponement, of several mega Chinese-driven projects in Malaysia.
The method of repayments with China, involving huge amounts of money, has, of course, been called into question and condemned. One critic even described the terms as “strange”.
It’s apparent the situation is delicate now, and we need to tread carefully because we are dealing with a global leader. The PM admitted that his government was “dealing with a very powerful country. As such, matters affecting both parties will require friendly discussions”.
Former finance minister Daim Zainuddin also said that Malaysia will carefully handle business contracts with China made by the previous administration.
In an interview with The Star, Daim admitted that the economic superpower is a friend to Malaysia. “China is very important to us,” he said. “We enjoy very close relations, but unfortunately, under the previous administration, a lot of China contracts are tainted, difficult to understand and the terms are one-sided,” said Daim. There is plenty at stake here. The world has also changed, and Malaysia needs to be mindful of its diplomatic move. These are sensitive times, and to the Chinese, the issue of “face” is an important one.
Whether we like it or not, the whole world is looking towards China because this is where the fundamental building blocks of a future global digital economic model is being curated and built.
Japan’s economy, on the other hand, has been in regression over the last two decades, and open data is easily available to prove this point. Just google it. That aside, China is Malaysia’s largest trading partner in Asean, especially after Malaysia-China bilateral transactions rose as much as 28 per cent to 139.2 billion ringgit in the first half of 2017.
The Chinese government has been very positive with bilateral relations with Malaysia over the years, and this great foundation is what we must build on. It doesn’t matter who the Malaysian prime minister is now.
With Ali Baba and Tencent coming to Malaysia, SMEs – which comprise more than 95 per cent of Malaysian business entities – exporting to China will be a huge foreign trade opportunity.
Of all the Asean nations, Malaysia has the largest pool of businessmen who speak the relevant Chinese dialects and understand the culture. But it’s not just the Malaysian Chinese businessmen who stand to benefit, but other races too.
Let’s not forget that China will be under steady stewardship for the coming decade since Xi Jinping has strengthened his position as the premier. And with Mahathir rightfully announcing that Malaysia will be a neutral country, this will mean a stable foreign policy, which is crucial for the rules of engagement.
The same can’t be said of Japan, though, as it has a history of turbulent domestic politics, with frequent changes in leadership.
Truth be told, China has outperformed Japan. The republic has become a model of socio-economic reform that connects, not only the past with the present, but more importantly, can rewrite the history of human development into our common future.
The One Belt, One Road initiative is the future. It was also reported that China has overtaken Japan in global patent applications filed in 2017 and is closing in on the United States, the long-standing leader, the World Intellectual Property Organisation said in a report.
With 48,882 filings, up 13.4 per cent from a year earlier, Chinese entities came closer to their American counterparts, which filed 56,624 applications. Japanese applicants ranked third with 48,208 demands for patents, up 6.6 per cent from a year ago, the report revealed. According to the Geneva-based institution, China will likely overtake the US as the world’s largest patent applicant within three years.
Two Chinese firms topped the list, led by Huawei Technologies Co with 4,024 patent applications and ZTE Corp with 2,965 submissions. Intel Corp of the United States is placed third with 2,637 filings, followed by Mitsubishi Electric Corp with 2,521.
China has also declared its ambition to equal the US in its AI capability by 2020 and to be number one in the world by 2030.
Malaysia is in pole position to take advantage since our neighbour Singapore has always been perceived to be too US-centric. It will be a waste if we let politics get in the way, as no one can dispute that China now plays a respected and vital role.
Anyone can tell that China will reshape the new world order. It is the new Middle Kingdom and is the country to look up to. And Mahathir should pick up on this because at the end of his trip to Japan, the press bombarded him with the predictable and nagging question – when will he be visiting China?