Mahathir may review some China-Malaysia deals

World
Europe

Malaysia may renegotiate some deals with China, Mahathir Mohamad said on Thursday, just hours after being sworn in as prime minister following his coalition's stunning election win.

Mahathir said that his government would likely reverse some policies implemented by the long-ruling Barisan Nasional coalition, including a highly unpopular goods and services tax.

The 92-year-old told a news conference he supported China's Belt and Road initiative (BRI) but said Malaysia reserved the right to renegotiate terms of some agreements with Beijing, if necessary.

A Nomura report last month showed that Malaysia is one of the largest beneficiaries of Chinese investment commitments in Asia, securing 34.2 billion US dollars of BRI-related infrastructure projects.

Another report by Citi estimated that Malaysia could receive more than 100 billion US dollars' worth of investment from China in the next two decades.

Current projects underway include a "digital free trade zone" established by Alibaba, which is set to see a virtual platform start operations next year, facilitating e-commerce, customs and shipping in the region. Alibaba has denied accusations that it is seeking a monopoly in the region, saying its platform will be open to all.

Mahathir last month said one of the BRI projects he would review would be a proposed 688-kilometer-long high-speed rail line on Malaysia's east coast built by China Communications Construction for an estimated price of 13 billion US dollars.

Asked about the idea of renegotiation, Chinese Foreign Ministry spokesperson Geng Shuang did not address the issue directly, but said the two countries' relations were developing well.

"This is worth both sides cherishing and safeguarding," Geng added, at a regular news briefing in Beijing on Thursday.

(With input from Reuters.)