King Salman arrives in Malaysia for talks
Interest to focus on Aramco share offer
ABU DHABI // Saudi King Salman began a rare, month-long tour of Asia in Malaysia yesterday in a trip aimed at enhancing trade ties with the world’s fastest-growing region.
King Salman, 81, was received by Malaysian prime minister Najib Razak at Kuala Lumpur airport before a state ceremony at parliament and a meeting with King Muhammad V.
Mr Najib and King Salman are due to hold talks today.
The last Saudi ruler to visit Malaysia was King Abdullah in 2006. Ties have since grown.
“Trade and investment remain the major cornerstone of discussions between both countries,” Malaysian foreign minister Anifa Aman said.
Riyadh is hoping to attract investors from the region through its Vision 2030 economic diversification strategy, a cornerstone of which is a public offering for up to 5 per cent of the country’s most important asset, Saudi Aramco oil company.
“The Aramco IPO will be part of these talks given Malaysia’s expertise in oil, gas and Islamic banking,” said Sean Foley, a professor at Middle Tennessee State University.
The sale has been scheduled for next year, although there have been reports of possible delays. Saudi officials are also considering whether to host the listing, or part of it, on an Asian exchange.
The kingdom is also seeking investors and skilled workers for its plans to expand its industrial base.
“Malaysia will capitalise on the National Transformation Plan and Vision 2030 of the Saudi government, which are aimed at diversifying economic activities,” Mr Aman said.
“In this regard, Malaysia hopes to export not just goods, but also expertise and know-how in manufacturing and services to Saudi Arabia.”
Economic cooperation under discussion will not be limited to ventures in Saudi Arabia. Local media reported that the Malaysian state oil company Petronas will sign an agreement with Aramco to work on a major refining and petrochemical project in Malaysia.
“Saudi Arabian investment in Malaysia is expected to create thousands of jobs and we are proud that Malaysian firms have been chosen to undertake projects at some of the most prestigious locations in Saudi Arabia,” Mr Najib said.
The kingdom is Malaysia’s second-largest trade partner in the Middle East and trade increased by more than 12 per cent to US$ 3.17 billion ( Dh11.64bn) between 2015 and last year, Mr Aman said.
“Political and economic relations have grown especially close over the past 20 years, with the growth of Malaysia and other Asian economies and Saudi Arabia’s look-east foreign policy after 2005,” Mr Foley said.
“Today, scores of Malaysians work in the kingdom, which is one of Malaysia’s fastest growing trading partners.”
A record of more than 100,000 Saudi citizens visited Malaysia last year, he said.
South-east Asia faces a serious threat from local supporters of ISIL and other extremist groups, and the two countries have also become more closely aligned on security and counter-terrorism in recent years. Kuala Lumpur joined the Saudi- led Islamic Military Alliance that is ostensibly aimed at counter-terrorism, although Malaysian officials said their role was limited to intelligence cooperation.
The country’s defence minister held talks in Riyadh with deputy crown prince Mohammed bin Salman in November, and the two countries announced they were establishing a joint centre aimed at countering extremists online.
Last year, the two countries also signed an agreement to strengthen cooperation on defence.
There has been some tension in relations in the past year over a money-laundering scandal at 1MDB, the Malaysian sovereign wealth investment fund founded by Mr Najib.
An investigation by Malaysian authorities found that in 2013, $700 million was transferred by the Saudi royal family into Mr Najib’s personal bank account.
Mr Najib has denied wrongdoing, and the investigation found that most of the amount was returned, although other countries including the United States are still investigating.
After Malaysia, King Salman will travel to Indonesia, Brunei, Japan, China and the Maldives before making a stop in Jordan on his way home.
He will “meet the leaders of those countries to discuss bilateral relations and regional and international issues of common concern”, the Saudi royal court said.
‘ The kingdom is one of Malaysia’s fastest growing trading partners Sean Foley Professor at Middle Tennessee State University