Nikkei Asian Review: Malaysia asks Japan for yen loan to solve financial woes
Prime Minister Mahathir seeks Tokyo’s help in developing railways and education
Cover Photo by Uichiro Kasai
Malaysia is seeking for a loan from Japan, in their bid to divert away from toxic loans/investment from China.
( Read more: Malaysia Tipping The Power Balance Away From China In South East Asia )
Malaysian Prime Minister Mahathir Mohamad said Tuesday he had asked Japan for yen-denominated loans as Kuala Lumpur seeks to pare down its hefty debt load.
“The resolution of the debt problem would enable Malaysia to once again be a good market for Japan and Japanese investments in Malaysia,” Mahathir said. He did not say how much he wanted to borrow from Japan.
However, its looking like a hard sell, which Japan’s Prime Minister Shinzo Abe, probably caught by surprise, and would need to think carefully about.
Mahathir said Abe promised to consider the request.
Abe said Japan would continue to support Malaysia’s growth and nurture ties between the two countries to a “new level,” through collaboration on education, human resources, science and technology.
In the same article, it is reported that Malaysia is looking to upgrade existing railway lines, instead of investing in the High Speed Rail (HSR), as Malaysia’s new government is trying to tackle their exploding debt.
Mahathir told reporters Tuesday that Malaysia has also requested Japanese assistance to improve existing railroads to increase the frequency of freight and passenger trains running on underused tracks and stations. Such improvements could reduce road traffic and enhance rail transport in Malaysia.
The prime minister has said Malaysia would only consider a high-speed rail system in the future, due to the high costs, suggesting upgrading existing rail lines will suffice for the near term.
Malaysia’s geopolitical pivot would not be complete if Malaysian PM, Mahathir, do not go back to his “Look East” policy.
In his meeting with Abe, Mahathir also expressed hopes that Japanese universities would set up branches in Malaysia. Currently, higher education institutions from Australia, China and the U.K. have campuses in Malaysia, but Japanese universities do not. Mahathir said Malaysia would revive its Look East policy, pledging to study the cultural values and work ethic of Japan as a guide to industrialization.