SCENESETTER FOR THE VISIT OF 13TH AIR FORCE

S E C R E T SECTION 01 OF 05 KUALA LUMPUR 001059

SIPDIS

SIPDIS

FROM AMBASSADOR FOR LIEUTENANT GENERAL UTTERBACK

E.O. 12958: DECL: 06/19/2027
TAGS: MARR MASS MCAP MOPS PREL PTER OVIP MY
SUBJECT: SCENESETTER FOR THE VISIT OF 13TH AIR FORCE
COMMANDER LIEUTENANT GENERAL UTTERBACK


Classified By: Ambassador Christopher J. LaFleur, reasons 1.4 (b, d).

Summary
--------------


1. (C) Welcome to Malaysia. Malaysia is important to us
because it is a successful, moderate, predominantly Muslim
country that, over the longer term, may be able to support us
more strongly in places like the Middle East. It is
strategically located on the Straits of Malacca, through
which one quarter of the world's trade flows, and it borders
five of the other nine ASEAN countries. Malaysia is also a
good partner in the war on terror. It is our tenth largest
trading partner, and many major American companies have
invested here. The overall tone in Malaysian-American
relations has improved considerably since Abdullah Badawi
became Prime Minister in late-2003. Bilateral relations
eroded under Abdullah's vituperative predecessor Dr. Mahathir
Mohamad, but Abdullah brought with him a friendlier style and
an interest in projecting a more moderate image, both for
himself and for his country. CT cooperation remains strong.
We have increased senior-level exchanges since Abdullah came
aboard, for example conducting our first ever Senior Dialogue
with the Foreign Ministry at the Assistant Secretary level in
May 2005. Malaysia has acceded to the IAEA Additional
Protocol, begun drafting export control legislation, and
participated as an observer in PSI exercises. Malaysia has
played a positive role in helping to stabilize Aceh,
Mindanao, and East Timor.


2. (C) Military-to-military cooperation is improving, with 23
US Navy ship visits to Malaysian ports in 2006, up from three
in 2003. Malaysia's traditional approach to global issues,
which Abdullah has continued albeit at a lower decibel level,
remains an impediment to closer bilateral cooperation.
Malaysia actively participates in the NAM and the OIC, often
adopting distinctly third-world positions on issues of
importance to us. Our public affairs environment is also
challenging. The Malaysian public is strongly opposed to our
policies in the Middle East and the Persian Gulf. A strong
"post-colonial overhang" also colors Malaysian attitudes
toward the U.S. role in Southeast Asia. With Abdullah we
have nevertheless been able to pursue a set of broad common
interests, and pragmatism generally rules in bilateral
security relations. Your visit will help us further cement
military-to-military ties, and we look forward to your
arrival. End Summary.

Political/Economic Landscape
--------------


3. (C) Malaysia has been a difficult political partner in
the past. Malaysians nurse strong anti-colonial sentiments.
They are fiercely protective of their sovereignty and (among
the Muslim Malay majority) resent perceived ill treatment of
Islam by the West. Malaysian intellectuals tend to hold a
"Euroskeptic" view of U.S. foreign policy in general and like
to cast themselves as defenders of "third world" interests.
Former Prime Minister Mahathir played on these sentiments to
generate political support for himself and his ambitious
economic agenda. When he relinquished his post in 2003, he
left behind a modernized economy but also strained relations
with much of the West. Today, however, Malaysia presents us
with important transformational opportunities. In terms of
its economic development, educational achievement, public
welfare, and political stability, Malaysia stands out among
Muslim-majority nations. The Malaysians project a moderate
version of Islam, and, over the longer term, could lend
additional support to democratic forces in the Middle East
and Iraq. We also share strong common East Asian regional
interests in stability and prosperity. Malaysian
counter-terrorism cooperation is indispensable in defeating
Jemaah Islamiyah (JI) in the region. Malaysia's economy is
one of the most open, diverse and well-developed economies in
the Islamic world and in ASEAN. Malaysia is our tenth
largest trading partner, we are Malaysia's number one foreign
investor.

Bilateral Ties--Improving the Substance
--------------


4. (S) In our bilateral relations, the GOM has begun
matching improvements in tone with improvements in substance.
PM Abdullah has openly espoused improved relations with the
U.S., and values the good rapport he established in his
meetings with the President. Last summer, Secretary Rice met

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with PM Abdullah and FM Hamid at the ASEAN Regional Forum and
President Bush met with PM Abdullah on the sidelines of the
UNGA in September. Last year the GOM acceded to our
long-standing urging and signed the IAEA Additional Protocol;
the Malaysians have also started sending observers to recent
PSI exercises; and the GOM is preparing to implement an
export control regime.


5. (C) Although they keep the details closely held, the GOM
has been a key partner on counterterrorism. Early round-ups
in 2001-2002 of scores of Jemaah Islamiyah (JI) suspects
helped ensure there have been no terrorist attacks here.
However, Malaysian extremists, as illustrated by a series of
arrests in Malaysia's Borneo states last year, still have the
capability to support JI operations elsewhere. Two
Malaysian citizens were among the 14 high value U.S.
detainees transferred to Guantanamo last year. In 2003,
Malaysia established the Southeast Asia Regional Center for
Counterterrorism (SEARCCT),which runs a full schedule of
multilateral training courses, many conducted with U.S.
support. We and our colleagues in Manila, Jakarta and other
Southeast Asian posts have embarked on a regional effort to
strengthen these countries' border controls. In cooperation
with GOM, we undertook a Border Control Assessment Initiative
(BCAI) in eastern Sabah with participants from the Department
of State, Homeland Security, USCG and JIATF West. The heads
of the Embassy's Defense Attach and Defense Cooperation
offices attended the field portion of this assessment.

Security Cooperation
--------------


6. (C) The strong state of U.S.-Malaysia bilateral defense
ties finds expression in numerous high level visits. The
Chairman of the Joint Chiefs of Staff, General Peter Pace,
recently concluded in May a very successful visit to Malaysia
which included calls on both the Prime Minister and the
Deputy Prime Minister. General Pace's visit came on the
heels of former Malaysian Armed Forces (MAF) Chief Admiral
Anwar's visit to the U.S. in October; the Mid Year BITACG
review in November; and the Chiefs of Defense Conference in
November that was hosted jointly for the first time by
PACOM-MAF. Anwar retired in March and was replaced by
General Abdul Aziz bin Hj Zainal. Changes in the military
leadership have not adversely impacted mil-mil cooperation
between the United States and Malaysia which grew in recent
years under Anwar's leadership. Ship visits have
significantly increased and received greater visibility and
security-related training sponsored by the United States for
military and law enforcement participants has also been on
the rise. Although the possibility of a terrorist threat to
the Malacca Strait has received the bulk of international
attention, the fact is that although pirate attacks
illustrate vulnerabilities, we have never identified any
terrorist activities in the Straits. Conversely, terrorists
operate regularly in the Sulu/Sulawesi Sea corridor and we
are focusing increasingly on this theater.


7. (C) Malaysia has had limited success in initiating the
"Eyes in the Sky" program, a regional aerial monitoring of
the Straits of Malacca. However, a reduction in incidents of
piracy and improved risk assessment by Lloyds of London have
lowered the program's priority in the GOM and it moves
cautiously forward in its multilateral efforts in this area.
Malaysia concluded a new 505 agreement last year that will
allow us to utilize 1206 funds to put CT equipment into the
vulnerable Sulu and Sulawesi Seas border areas of Sabah where
terrorists are known to transit. We are awaiting final
approval of the 1206 proposals made in conjunction with
regional embassies. Malaysia has not signed either a PSI or
Article 98 agreement. In general, Malaysia remains open to
bilateral cooperation that strengthens its own defense
capacity, but the GOM will quickly raise the principles of
sovereignty and territorial integrity when discussing
international security regimes and coordination, such as for
the Straits of Malacca. Malaysia's only multilateral defense
arrangement is the Five Power Defense Pact with the UK,
Singapore, Australia and New Zealand.


8. (S) We have been pleased by the overwhelmingly positive
media coverage our ship visits have received, in contrast to
the quiet arrivals of past years. The flip side to this is
that our visits are getting increased attention from
ideological foes on the Islamic right, and from some
mainstream politicians pandering to the conservative Islamic
vote. Deputy Prime Minister Najib has stoutly defended our

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cooperation before Parliament, and we do not see that our
engagement is under threat. However, we do need to be
cognizant of our increased military visibility and sensitive
to GOM concerns, particularly with high tensions in the
Middle East. The GOM cited concerns about the growing
visibility of training in eastern Sabah when it recently
decided to review on a case by case basis proposed training
events involving foreign military forces in that region.


9. (C) Malaysia has an excellent record in UN Peacekeeping
Operations. They have committed forces to various UN
operations since the early 1960s. Currently, 360 Malaysian
troops are participating in UNIFIL (Lebanon) and the GOM has
offered a contingent of up to 1000 soldiers. Malaysia has
developed a Peacekeeping Training Center and updated the
facility in recent years to provide specialized training for
the troops it sends into the field as well as personnel from
foreign militaries. The USG has obligated almost 1.1 million
dollars for GPOI funds that will focus on a developing a
multilateral peacekeeping operations exercise in 2009.


10. (C) Malaysia maintains friendly relations with Iran,
including a growing commercial relationship. Malaysia has
lent rhetorical support to Iran's right to develop "peaceful"
nuclear technology but has also consistently maintained that
it will implement UN decisions on Iran, including sanctions
regimes. After the latest UNSC resolution, Prime Minister
Abdullah called clearly and publicly for Iran to respect UNSC
resolutions on its nuclear program. Recent actions by
Malaysian firms have generated concerns of violations of U.S.
laws and the Wassenaar Arrangement and a Malaysian company
was among those recently sanctioned under the Iran Syria
Non-proliferation Act (ISNA) for its role in shipping
proscribed materials to Iran. The activities of local firms
doing business with Iran need to be closely monitored, and we
continue to request Malaysia's assistance in investigating
suspicious activity. One Malaysian firm has signed an
agreement for a multi-billion dollar investment to develop
enormous natural gas fields in Iran, a deal which has drawn
condemnation from U.S. congressional voices in light of the
Iran Sanctions Act.

Recent Mil-Mil Talks
--------------


11. (C) In May 2007, Malaysia hosted the annual Bilateral
Training and Consultative Group (BITACG) meeting in Port
Dickson. BITACG is a forum used to promote and strengthen
mil-mil relations through discussions of bilateral exercises,
intelligence exchanges, C4 issues, logistics engagement, and
defense cooperation. Malaysia has recently agreed to co-host
an annual conference for military intelligence chiefs in the
Asia-Pacific region.


12. (SBU) Malaysia has put forth a regional Humanitarian
Assistance/Disaster Relief (HA/DR) Center initiative that is
promising, and has wide support in the government. The MAF
has identified Subang Airfield as a likely choice for the
center which would be administered under UN auspices.
Subang, the former international airport, served as the focal
point for Malaysia's tsunami and Yogyakarta relief efforts.
The facilities are modern and are available. Malaysia is an
ideal location for a regional HA/DR center-centrally located,
modern, stable, and Islamic. Malaysia is no further than two
hours by air to almost any country in the region. Avian
influenza preparedness is another promising area of bilateral
cooperation. Last September, PACAF conducted a successful AI
SMEE with the Ministry of Health. The U.S. team recommended
changing Malaysia's AI preparedness rating from High risk to
Partner Nation. Building upon this success, the ODC has
proposed a regional workshop on Bio-terrorism
Defense-Strategic a
nd Tactical Planning for spring 2007 with PACAF and the U.S.
has provided personal protection gear and laboratory analysis
equipment to the Malaysian government. Malaysia will co-host
this multilateral/regional event as it has demonstrated
capacity as a regional partner in preparing for the threat of
avian/pandemic influenza. PACOM's efforts in furthering
Malaysia's capacity as a regional responder are critical to
the country teams in this regard.

Malaysian Foreign Policy and U.S. -- A Mixed Bag
-------------- ---


13. (S) Abdullah champions his moderate vision of Islam --
albeit with limited impact to date -- within the Organization

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of the Islamic Conference (OIC),which Malaysia will continue
to chair through early 2008. Malaysia supports Abbas, the
Palestinian Authority, the MEPP roadmap, and Iraqi
reconstruction. However, the Malaysian public remains highly
critical of our Middle East policies, and the GOM is
consistently critical of Israel, with which it has no
diplomatic relations.


14. (S) Malaysia surrendered the chairmanship of the
Non-Aligned Movement in September last year, but as past
chair remains a member of the leadership troika. During
Malaysia's tenure it supported NAM positions on the Iranian
nuclear program, and engaged with such problematic
international players as Zimbabwe, Cuba and Venezuela. The
GOM nevertheless tells us that they argued for moderate
approaches with then the NAM on such issues as Iran.
Abdullah hosted Hugo Chavez for a visit to Malaysia last
August, and assured Chavez of his support for Venezuela's
election to the Latin American chair on the UN Security
Council. This was followed by a well publicized visit to
Venezuela by Abdullah in December to explore stronger
commercial ties.


15. (C) The GOM issued a public condemnation of North
Korea's nuclear test and publicly supports UNSCR 1718,
although it has no enthusiasm for sanctions. They repeatedly
called for a return to the six-party DPRK nuclear talks and
criticized North Korea's truculence. The Malaysian
government is publicly supportive of China's "peaceful rise",
welcoming in particular China's growing imports of Malaysian
products, despite lingering suspicions among some officials
of China's long-term intentions.


16. (C) Malaysia has played an increasingly prominent role
in addressing conflicts facing its Southeast Asian neighbors.
Last year Malaysia completed its earlier peacekeeping
mission to East Timor following the armed uprising that led
to deployment of Australian, Malaysian and Portuguese forces,
while a new deployment of Malaysian police personnel is in
East Timor now. The GOM has also taken a leading role as the
facilitator for the southern Philippines peace process.
Malaysia's sympathies for the Muslim Moro population and
geopolitical calculations vis-a-vis the Philippines do not
make it an honest broker, but Malaysia has nonetheless hosted
negotiations and contributed observers to the International
Monitoring Team in the southern Philippines. Geography and
cross-border ethnic bonds make Malaysia a de facto safe haven
for southern Thai insurgents, though the GOM has not
encouraged this. The Malaysians have urged the Thai
government to resolve peacefully the unrest in Southern
Thailand, with its ethnic Malay Muslim population, and
Malaysia and Thailand are cooperating on new border security
measures. Malaysia is especially chagrined by Burma's
intransigence because it championed Burma's entry into ASEAN.
Having publicly criticized the Burmese regime, however, FM
Hamid appears to be at a loss as to what to do next.
Malaysia spoke out against the UNSC draft resolution on
Burma, which we championed before the UN Security Council in
January, and firmly backed the ASEAN argument that Burma was
not a threat to international peace and security.

Malaysia's Moderate Islam
--------------


17. (C) Malaysia, with its entrenched majority coalition, is
hardly an ideal democracy, but it can still serve as a
reference point for evolving Islamic societies elsewhere.
The Malay people, long known for their social tolerance, have
become more religiously conservative in recent years, but
Prime Minister Abdullah has enshrined the Malay political
elite's continued preference for moderation in his "Islam
Hadhari" or "Civilizational Islam" policy. Abdullah's key
message is that Islam can become a leading world civilization
again only if it embraces economic development, education,
innovation and tolerance. Observers are wary of a
longer-term trend toward greater divisions between the Muslim
Malay majority and other ethnic groups, and religious
minorities increasingly complain of growing Islamization.
Nevertheless, Malaysia has kept inter-ethnic tensions well
under control by regional and world standards for almost 40
years.

Trafficking in Persons creates a setback
--------------


18. (C) On June 12, the State Department determined that

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Malaysia did not meet the minimum standards for combating
trafficking in persons; resulting in a Tier 3 ranking in the
annual report to Congress. Malaysia has been given 60 days
to show significant efforts to come into compliance with the
U.S. Trafficking Victims Protection Act or face possible
sanctions for non-trade related and non-humanitarian
assistance. We are working diligently with the GOM to
address these issues but draw your attention to the
possibility of sanctions which could potentially affect our
mil-mil exchanges and training assistance.
LAFLEUR