Australia and Malaysia: shared interests and common values

Datuk Seri Mustapa Mohamed

By Georgina Downer

Australia’s relationship with Malaysia has experienced its fair share of ups and downs.  Who can forget Paul Keating’s summation of his counterpart, Malaysian Prime Minister Dr Mahatir Mohammed, in the 1990s.

But the last decade has seen the relationship grow in depth and quality, across government, the education and business sectors, as well as significant people-to-people links.

This year Australia celebrates the 60th anniversary of its diplomatic presence in Malaysia, an anniversary which predates the birth of the Federation of Malaya two years later in 1957.

Last year Malaysia’s aviation industry was rocked by tragedies with the disappearance of Malaysian Airlines flight MH370 over the Indian Ocean and the downing of MH17 over eastern Ukraine.  In the midst of these disasters, Australia came to Malaysia’s aid, jointly coordinating the search operations for MH370 and sponsoring a UN Security Council resolution condemning the downing of MH17 and demanding an independent international investigation.

Malaysia is part of the 10-nation bloc, ASEAN.  ASEAN is Australia’s second largest trading partner with two-way trade valued at $100 billion.  This year, under the chairmanship of Malaysia, ASEAN will take a step closer to regional economic integration by launching the ASEAN Economic Community (AEC).  Complete economic integration won’t happen this year, and in any event, ASEAN will never be the European Union of Southeast Asia, but the aims are to eventually create a single market and an economic powerhouse. 

Malaysia exemplifies the ASEAN success story

It has developed from a commodity dependent economy to a dynamic, modern economy.  Australia’s trade and investment with Malaysia is healthy and growing, but there is much more that could be done, especially as Australian companies see Malaysia more and more as a hub from which to do business with the rest of ASEAN.

Much more could also be made of the benefits flowing from the Malaysia and Australia Free Trade Agreement (MAFTA) to Australian companies.  MAFTA came into force in 2013 and builds on the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).  By 2017, 99 per cent of all Malaysian tariffs on Australian goods will be eliminated, while Australia eliminated all tariffs on goods from Malaysia in 2013.

Like Australia, Malaysia is participating in the Trans-Pacific Partnership negotiations.  If and when the TPP is signed, Malaysia will need to undertake some tough reforms especially in relation to its affirmative action policies for ethnic Malays (bumiputras).  Increased transparency and certainty in this regard will be important for international investors.

Australia’s education links with Malaysia form not only a significant part of the trading relationship, but also the people-to-people links.  Malaysia was the single biggest benefactor of the Colombo Plan in the 1950s-80s, and over 300,000 Malaysian students have studied in Australian universities.  The New Colombo Plan will see more and more Australian students studying in Malaysia.

Asialink’s engagement with Malaysia is extensive across its four program areas. 

Asialink Business provides Asia capability development programs as well as pre-departure training for Australian students undertaking the New Colombo Plan.  By the end of 2015 Asialink Business will release a Malaysia country starter pack designed to provide Australian businesses, in particular SMEs, looking to establish or expand their operations in Asia with country-specific market information.

Asialink Diplomacy conducts track II diplomacy initiatives in the region, including the annual ASEAN-Australia-New Zealand Dialogue in conjunction with the Institute of Strategic and International Studies in Malaysia.

This year Asialink Arts is supporting two arts residencies in George Town, Malaysia.

The Asia Education Foundation has established 10 Bridge School Partnerships in Malaysia, as well as conducted two reciprocal 10-day professional learning programmes for Australian and Malaysian teachers.

Asialink hosted Australia’s High Commissioner to Malaysia, His Excellency Rod Smith PSM , at a boardroom briefing on 14 July 2015.

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Renuka Rajadurai