Malaysia's leader courted Chinese e-commerce investment in his country today, the start of his first trip to China since his stunning electoral victory three months ago.
Prime Minister Mahathir Mohamad's visit to the world's second-largest economy is being watched for signs on the fate of multibillion-dollar Beijing-backed projects he's said he wants to cancel.
Today, Mahathir toured the campus of Chinese online shopping giant Alibaba Group in the eastern city of Hangzhou, met with the company's founder, Jack Ma, and told the company's executives that Malaysia wants to explore ways to collaborate further with Alibaba, according to Malaysian state news agency Bernama.
He also visited Geely, which owns Geely Auto, one of China's biggest independent automakers.
It owns 49.9 per cent of Proton, a Malaysian automaker. Tomorrow he will visit a Chinese drone company and meet with Malaysian businesspeople in Beijing.
Mahathir, a vocal critic of Beijing-backed investment in his country, has tested Malaysia's ties with China by suspending multibillion-dollar Chinese-backed infrastructure projects.
He's expected to attempt to renegotiate the terms of the projects during his meetings with Chinese officials.
He will hold talks with Chinese leaders including Premier Li Keqiang and President Xi Jinping on Monday.
Days before heading to Beijing, Mahathir said Malaysia doesn't need a Chinese-backed USD 20 billion East Coast Rail Link and two energy pipelines worth USD 2.3 billion. The projects have been suspended pending renegotiation.
Malaysia's new government has called for drastic cuts to the projects' ballooning cost, which it estimates at more than USD 22 billion. Some of that money has already been paid and could be difficult to recoup.
China said Tuesday that Malaysia should handle any problems it has with the Chinese projects through talks.
The foreign ministry in Beijing defended China's projects in Malaysia, saying such deals have brought tangible benefits to the two countries.
"Any problems arising in the cooperation should be handled properly through friendly negotiation," the ministry said in a statement.
The projects are part of Xi's Belt and Road initiative to build ports, railways and other trade-related infrastructure across Asia, often built by Chinese contractors and financed by loans from Chinese state banks.
Belt and Road projects in Thailand, Sri Lanka and other countries have run into complaints they are too costly, give too little work to local companies or might facilitate embezzlement and other graft.
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