Mahathir offers economic package to Jakarta

He envisages closer cooperation between MAS and Garuda and a joint financial centre to forge stronger ties.

MALAYSIAN Prime Minister Datuk Seri Mahathir Mohamad arrived here yesterday, laying the groundwork for stronger ties with the new Indonesian government by offering a slew of economic proposals.

On the cards are more landing rights for Malaysian Airlines (MAS) in Indonesia, closer cooperation between MAS and Garuda, and setting up a joint financial centre to be based in Brunei.

Speaking to reporters after one hour of talks with President Abdurrahman Wahid, he said that his main aim for the two-day visit was to foster closer links with Jakarta, especially with an administration that had just come into power.

“For Malaysia, having strong links with Indonesia is very important for us,” he said. It was a point he underlined again at a luncheon at the palace attended by some 300 businessmen from both countries.

“All the changes taking place in Indonesia will not alter the fact that it is a vital nation in this region,” he said.

Analysts said the visit by the 150-member Malaysian delegation – 60 businessmen plus ministers, legislators and youth leaders – was to build up a network of links with Jakarta, given that levels of contact were limited with the coalition government.

Bilateral ties took a dip last year after sympathies were expressed by some Indonesian leaders for the plight of Dr Mahathir’s jailed former deputy Anwar Ibrahim.

During his visit to Kuala Lumpur less than a month after taking office last October, Mr Abdurrahman took pains to mend fences. He did not raise the Anwar issue with the Malaysian Premier and left with pledges of substantial economic aid. Mr Abdurrahman, together with Foreign Minister Alwi Shihab, who visited Malaysia last month to invite Dr Mahathir, was at Jakarta’s main air force base to welcome him.

The Indonesian President, who is said to be impressed by Dr Mahathir’s determination to devise his own recovery policies and reject IMF involvement in the process, said at the joint press conference that Indonesia could learn from Malaysia’s experience.

Dr Mahathir lost no time in anchoring ties by urging greater economic and trade links with Malaysia, which is Indonesia’s 11th largest investor with total investments amounting to US$7.6 billion. (S$13 billion).

He said that Indonesia had agreed to facilitate investments by Malaysian companies and the purchase of raw materials from the sprawling archipelago.

Both sides also discussed the possibility of setting up a joint financial centre to be based in neighbouring Brunei “to facilitate financial affairs of the three countries” and improve road links between Indonesia, Malaysia and Brunei.

If economics was the main theme of Dr Mahathir’s visit, politics was a strong subtext. Offering support for Indonesia in its problems with Aceh, he said the strife-torn province should remain part of Indonesia and vowed that Malaysia would not help the separatist movement there.

Posted in Indonesia