By Collins Chong Yew Keat

Prime Minister Datuk Seri Anwar Ibrahim's visit to the United Kingdom (UK) is pillared on the facet of strengthening economic friendship efforts for Malaysia to get the needed economic, trade, and investment returns, especially in new key critical areas that will be in line with the country’s economic transformation efforts.

The visit is also to secure greater trust and bond at the highest level involving the leaders, and to strengthen the deep underlying historical foundation of the ties between both nations encompassing both the economic pillar and the already strong people-to-people and business and education ties.

This also paves the way for more transcending ties in geopolitics, defence and security, which Malaysia needs to strengthen its fallback security options and deterrence capacity.

The UK is increasing its Indo-Pacific strategic pivot, in joining the bandwagon of securing the critical geographical frontier in securing both the supply chain of key natural resources and critical minerals through maritime security and the concept of a Free and Open Indo-Pacific, and also in increasing its presence in key flashpoints which will have a direct factor on the stability of the regional order based on rules and norms.

Malaysia, as the ASEAN Chair, will be banked on to ensure the key tenets of regional order based on the rules-based order and to galvanise regional economic integration and the roles of the collective ASEAN economies.

In the realm of defence and security, the role of Malaysia in serving as both the check and balance and in extending its defence friend-shoring net also helps to fill the gap in the region’s total combined defence deterrence, as reflected in the deals with South Korea, the renewed defence ties with Japan with Official Security Assistance (OSA), and new potential defence partner in Turkiye in shoring up Malaysia’s defensive capacity.

This helps to strengthen Malaysia’s overall defensive capacity, and also complements the overall added strength of the existing Five Power Defence Arrangement (FPDA) where Malaysia sits at the central strategic role for the UK in maintaining its Indo-Pacific presence and the role in Southeast Asia both in securing its supply chain and geopolitical interests and as an extended layer of forward base shield in facing potential hostilities and threats towards UK interests and in facing China’s new power moves.

The Indo-Pacific pivot by the UK will very much bring positive returns to Malaysia, especially in the defence and economic sectors, where the UK would increase its extended deterrence efforts through the intensification of power projection activities and in sending a message to the region that the UK’s presence is here to stay.

These manoeuvres in defence and diplomatic friend-shoring through the power moves and in deepening military ties and cooperation with key existing allies and with new potential partners will benefit the region and Malaysia, through a firm intent to help secure a free and open navigation, the right of passing and overflight in international waters and in upholding the sanctity of the rules-based order based on maritime and international law.

The new wave of building credible guardrails in the Indo-Pacific will elevate Malaysia’s long-term future role in UK’s new geopolitical shaping and strategic charting in this region, both in getting the best of Malaysia’s unique advantage in critical minerals and the country’s new similar economic and energy transitions, as well as Malaysia’s new venture in capturing the role and influence of the Global South and the existing leadership in the Muslim world.

Malaysian companies and firms’ dealings and ease of doing services will be made easier through the grouping of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), where the inclusion of the UK will provide a positive ripple impact. Malaysia’s current major firms which have been having a significant presence in the UK will also get the spillover impact. Most importantly, Malaysia’s main resources of palm oil and rubber, which have been subject to tariff before this, will now enjoy tariff-free status and there will also be a reduction in other barriers to the UK market.

New Economic Returns

The economic opportunities for Malaysia with the UK as a CPTPP member will open new avenues. These include access to both traditional economic and trade sectors, as well as serving as a precursor for similar pursuits in new economic transitions. These transitions will rely on digital transformations and a values-based economic approach, focusing on high technology. There will also be a strategic emphasis on the galvanisation of key critical minerals and commodities.

Additionally, this shift will support Malaysia’s transition from a labour-intensive, low-skilled economic and investment climate to one based on high-skilled talent, knowledge transfer, and the embrace of technology and digital advancements. This will align with Malaysia’s broader goals, such as carbon reduction, new energy transition and enhancing food and supply chain security. It will also serve as an important hedge, further strengthening Malaysia's reliance on the Global South.

The UK has been a traditional partner and a trusted security provider for decades, encompassing a deep level of trust and interdependence since the Cold War and the post-colonial period. The FPDA has been the main manifestation of the cornerstone of this deeply-embedded milestone of defence and security reliance, but bilateral security and defence will need to be shored up.

Unlike defence ties with the United States, defence ties with the UK have a distinct and unique character. These ties are underscored by shared past struggles against a common threat. They remain robust, with comprehensive and deep connections at various levels, encompassing both societal and non-societal ties between the two nations.

This relationship is also shaped by historical connotations, as both countries have shared a long history of development under the Commonwealth banner. Additionally, the evolving nature of threat settings, particularly with the return of traditional threats, further strengthens the bond between the UK and Malaysia in the defence sector.

Unlike the UK, for the US, it involves more of a practical grand overview of the significance of holding up to an expanded and extended umbrella of maintaining the values-based ideals and the tenets of freedom and democracy and defending the norms of international law and the rule of law.

Critical industries of mutual interests include Artificial Intelligence, digital economy, critical minerals and semiconductors, new energy economy, blue economy and the defence and security related industries.

The UK holds a conventional and existing edge in terms of expertise, infrastructure, and systemic readiness for this AI venture. In contrast, Malaysia offers a key holistic public-private orientation, with a strong focus on applying AI to various models of industrial and economic transition in the country.

Additionally, Malaysia serves as a hub for the influx of both Western and non-Western firms, along with an inflow of capital and investments in AI and digital-related fields. Malaysia’s strong foundation in electronics, electrics, and semiconductor manufacturing further complements this. This will benefit the UK in expanding its digital presence and outlook in the Indo-Pacific region.

Role in Navigating the West-China Tension

The UK is a cherished and a much-needed historical partner in a holistic overview, and more so in the realms of defence and security and economic and investment security. With increasing vulnerabilities and uncertainties in power tussles and a growing security dilemma, this long-standing economic, cultural and defence partnership of UK-Malaysia has stood the test of time and upheavals, and remains the indispensable factor in ensuring Malaysia’s deterrence capacity in building a more resilient and durable confidence and trust based on proven and trusted acts of support in the past and, more importantly, in sending a message that despite past neglect of the region, the new chairmanship and the renewed ties will bolster joint guardrails in establishing a new wave of economic and security confidence despite Malaysia’s strict adherence to its non-alignment policy.

Advanced manufacturing, new energy transition and digital economy remain the new facets of geostrategic importance to both countries, and both will amplify efforts to remain ahead in these fields.

For the UK, Malaysia sits at the centre of key maritime routes and in ensuring stable supply chain for the UK, in standing up to China’s new economic and defence postures. In taking into account the new opening and threats from the emergence of the Arctic and the Northern Sea Route in the renewed power tussle and power posture there over strategic routes and critical minerals and with the new opening of trade routes, UK will need a two-pronged strategy of having ASEAN and key components of ASEAN, including Malaysia, as the hedge and fallback in its quest to deal with the emergence of the Indo-Pacific and new potential flashpoints in the Arctic that will impact on its interests.

Collectively, the ASEAN bloc is ahead of the UK as the world’s fifth-largest economy, and UK-ASEAN trading relationship is worth £50 billion. The UK sees ASEAN as the key economic and increasingly defence bloc that has a profound direct impact on the UK’s long-term strategic balancing in its dealings and responses with a delicate and unpredictable China and also with the long-time ally of Washington, even in Trump 2.0.

Both the UK and Malaysia will need to foster deeper economic exchange of capital and technologies, drawing from the entrenched solid foundation of ties at the people-to-people level and at the official Track I level, in having more barrier free exchange of business, trade and investments in key areas for mutual benefit.

The current conventional model of strategic hedging and balancing also serves as a limitation for Malaysia in getting the full returns from the ties with the UK, and systemic practical barriers at the public level also constraint the efforts to further deepen solid commitments of key sensitive and strategic fields in defence and security, in keeping with the need to avoid upsetting other economic partners that are heavily depended on.

Ties have been robust, especially at the people-to-people level, education, tourism, research, new demographic outreach, business and trade. These areas of low politics provide the most significant and easiest low-hanging fruits in cultivating the supportive factor in the larger spillover impact and precursor to the more critical areas of deeper joint defence and security partnership and also cooperation in critical fields and the supply chain and food and energy security.

Ultimately, the quest to reap durable and future-driven returns from this unique and special relationship will be in the form of a strong and resilient message of the unique interdependence of key economic and security support and the deep trust and bond between both nations that were once under a different set of ties during the colonial period. This serves as a symbol of a needed trust-based relationship in creating a region and a world that is abiding with the rule of law and the international law in upholding peace and stability.

-- BERNAMA

Collins Chong Yew Keat is a Foreign Affairs, Strategy and Security Analyst with Universiti Malaya.