EU-Malaysia Relations EU-Malaysia Relations

EU Country Strategy Paper 2007-2013 (CSP)

Malaysia is a country with a population of about 27 million inhabitants. Its territory comprises approx. 330,000 sq km, four fifths of which are covered by forest. Malaysia's course of history has been dictated by its strategic position at one of the world's major crossroads, and a place of cohabitation and interaction of a wide array of races, religions and traditions. The present day Federation of Malaysia came into existence only in 1965, when Sarawak and Sabah joined the Federation of Malaya, which in turn originated from a negotiated and peaceful independence from the British Empire in 1957.

Since independence, Malaysia has adopted the political system of a parliamentary democracy. The political scene has been characterised by an extraordinary degree of political stability and continuity through an encompassing national coalition of political parties. The political leadership of the country has been focusing on two key long-term goals: cementing national unity and economic development with equity. While national unity remains elusive, the highly successful industrialisation drive (since the mid-1980's) has turned the country into one of the world's most important trading nations. The national poverty rate has fallen from 49.3% in 1970 to 5.7% in 2004. Malaysia's economic performance and fundamentals are strong; its social development is exemplary among developing countries.

EC cooperation with Malaysia has not been noteworthy until very recently, partly because Malaysia has not actively sought EC cooperation. With the opening of an EC Delegation to Malaysia in 2003, federal and state authorities, civil society, academia and local and EU business community, have shown much greater interest in EC cooperation, which has increased markedly.

The ongoing CSP (2002-06) allocates a modest €5.6 million to EC-Malaysia cooperation, focusing on two priority or focal areas: trade and investment facilitation, and higher education. Activities carried out in the field of higher education will be financed within the context of the regional programming for Asia.

So far, cooperation has been successful in areas of strategic importance and mutual interest, with a particular focus on economic relations, scientific and technology cooperation, as well as education, addressing in particular the human capital and technological requirements of development. Some cooperation activities are also conducted, successfully, in the area of human rights, especially gender equality and protection of the vulnerable. Cooperation has not yet extended to areas such as the fight against international organised crime and terrorism, good governance, justice and home affairs.

Some aspects of Malaysia's human and political rights record remain a cause for concern, in particular certain legal practices like the death penalty and corporal punishment, the modalities of detention under the Internal Security Act, and restrictions to the right to freedom of information, expression and association. The next SP (2007-13) proposes a shift to a more policy-dialogue oriented cooperation with a focus on trade and investment. Aspects that may be covered would include: trade and investment relations, human capital via higher education and research, human rights, governance, sustainable forestry and biodiversity management and related trade. This bilateral cooperation will be complemented by a limited range of actions and support, received through various EU funded thematic and regional programmes/budget lines, including e.g. Asia wide cooperation programmes (Asia Link in particular for higher education), the EU-funded RTD Framework programme. Under the Development Cooperation Instrument (DCI), an indicative amount of €17 million has been earmarked for Malaysia for the period 2007-13. These resources may be supplemented by projects and programmes financed under regional programmes for Asian countries and under various thematic programmes.