Malaysian Prime Minister Mahathir Mohamad is set to woo investors and offer business deals during a trip to Japan that starts on Sunday, as he looks to cover a gaping debt hole and shift the country away from dependence on Chinese investments.
KUALA LUMPUR (Reuters) – Malaysian Prime Minister Mahathir Mohamad is set to woo investors and offer business deals during a trip to Japan that starts on Sunday, as he looks to cover a gaping debt hole and shift the country away from dependence on Chinese investments.
The visit marks his first foreign trip after returning to power in a shock election result last month, and indicates a shift back to the 92-year-old’s ‘Look East’ policy to strengthen ties with east Asia, especially Japan.
It is also seen as a sign of the Southeast Asian country’s move away from China, which contentiously pumped billions of dollars into the scandal-tainted previous Najib Razak administration. The new government has said some Chinese companies are now under suspicion of being used to cover up the graft scandal at state fund 1Malaysia Development Berhad (1MDB).
“The previous government may have engaged Japan, but certainly not with the enthusiasm it had for China,” said Shahriman Lockman, a senior analyst with the Institute of Strategic and International Studies.
Malaysia’s cash-strapped government could look to tap Japan’s vast pool of low-cost capital, while potential stake sales in Malaysian state-linked companies could be investment targets of Japanese companies, said bankers involved in cross-border deals.
Mahathir had already agreed to attend the annual Nikkei conference on Asia before winning the elections, but will now also meet Prime Minister Shinzo Abe and senior officials during his three-day visit.
“The fact that he chose to stick to his plans to attend the conference does say something: it will doubtless provide an opportunity to rejuvenate Malaysia-Japan ties,” said Shahriman.
