Identifier
Created
Classification
Origin
08KUALALUMPUR1045
2008-11-28 07:13:00
CONFIDENTIAL
Embassy Kuala Lumpur
Cable title:  

IRAN-MALAYSIA TIES REFLECTED IN LATEST BILAT TALKS

Tags:  PREL PGOV ETTC ECON IR MY 
pdf how-to read a cable
VZCZCXRO1299
PP RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHKL #1045/01 3330713
ZNY CCCCC ZZH
P 280713Z NOV 08
FM AMEMBASSY KUALA LUMPUR
TO RUEHC/SECSTATE WASHDC PRIORITY 2030
INFO RUCNASE/ASEAN MEMBER COLLECTIVE PRIORITY
RUEHRL/AMEMBASSY BERLIN PRIORITY 0200
RUEHBY/AMEMBASSY CANBERRA PRIORITY 2696
RUEHLO/AMEMBASSY LONDON PRIORITY 0534
RUEHGO/AMEMBASSY RANGOON PRIORITY 0146
RUEHUL/AMEMBASSY SEOUL PRIORITY 1718
RUEHKO/AMEMBASSY TOKYO PRIORITY 2601
RUEHNE/AMEMBASSY NEW DELHI PRIORITY 0831
RUEHRH/AMEMBASSY RIYADH PRIORITY 0111
RUEHAD/AMEMBASSY ABU DHABI PRIORITY 0099
RUEKJCS/SECDEF WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RHHMUNA/CDR USPACOM HONOLULU HI PRIORITY
C O N F I D E N T I A L SECTION 01 OF 03 KUALA LUMPUR 001045 

SIPDIS

FOR EAP, NEA, AND INR

E.O. 12958: DECL: 11/28/2028
TAGS: PREL PGOV ETTC ECON IR MY
SUBJECT: IRAN-MALAYSIA TIES REFLECTED IN LATEST BILAT TALKS
AND PM PLAN TO VISIT IRAN

Classified By: Political Counselor Mark D. Clark, reason 1.4 (b and d).

Summary and Comment
-------------------
C O N F I D E N T I A L SECTION 01 OF 03 KUALA LUMPUR 001045

SIPDIS

FOR EAP, NEA, AND INR

E.O. 12958: DECL: 11/28/2028
TAGS: PREL PGOV ETTC ECON IR MY
SUBJECT: IRAN-MALAYSIA TIES REFLECTED IN LATEST BILAT TALKS
AND PM PLAN TO VISIT IRAN

Classified By: Political Counselor Mark D. Clark, reason 1.4 (b and d).

Summary and Comment
--------------

1. (C) Malaysia and Iran held their Seventh Joint Commission
meeting in Putrajaya, November 10-11. Trade and investment
issues dominated the talks, which were conducted at the
foreign minister level. Results from the Commission meeting
appeared modest, according to press reports. Malaysian
Foreign Minister Rais Yatim cited intentions to strengthen
various trade and investments mechanisms, including a payment
agreement between the respective central banks. FM Rais
encouraged Malaysian firms to do business in Iran, noting the
limited scope of UN sanctions. Deputy Prime Minister Najib,
who also met with Iranian FM Mottaki, told the Ambassador
that normal (in the sense of legitimate) commercial dealings
with Iran "should proceed." Mottaki invited Prime Minister
Abdullah to visit Iran, and Abdullah has tentatively accepted
for December 22-23, according to GOM officials.
Malaysia-Iran ties were in the spotlight prior to Mottaki's
visit, as the Malaysian Foreign Ministry stopped Iranian
Nobel Laureate Shirin Ebadi from taking part in a prestigious
lecture series. The MFA told organizers that Ebadi's
invitation to speak would damage Malaysia's "good and close"
relations with Iran. Despite FM Rais' brief comments
disowning his Ministry's decision, organizers have not
received an official green light to reschedule Ebadi.


2. (C) Comment: The latest round of Malaysia-Iran bilateral
talks demonstrated Kuala Lumpur's continued and unapologetic
pursuit of strengthened trade, investment and financial links
with Tehran. The November 10-11 meeting also reflects
Malaysia's goal of increasing its economic ties with West
Asian countries in general. Malaysia-Iran economic relations
remain modest, focusing primarily on oil/gas, tourism and
education. Senior Malaysian officials appeared consciously
to avoid political statements and, except for FM Rais' inept
comments, drew minimal attention to their dialogue with Iran,

an indication of some GOM sensitivity toward international
concerns. The Malaysian Foreign Ministry's actions to
appease Iran by scuttling Ebadi's speaking engagement
highlight the particular sympathy Iran enjoys in the halls of
the MFA, a bias not as clearly evident in other Malaysian
agencies. If we confirm that PM Abdullah will visit Teheran,
we will request that Department instruct us to encourage
Abdullah to use his visit to support international mediation
efforts regarding Iran's nuclear program. End Summary and
Comment.

Trade Tops of the Agenda
--------------


3. (U) Malaysia and Iran held their Seventh Joint Commission
meeting in Putrajaya, November 10-11, the latest iteration in
a process begun in 1989 to coordinate bilateral cooperation
and ties. The two countries held the preceding Sixth Joint
Commission meeting in Teheran in November 2006. The
Malaysian and Iranian delegations were led by their
respective foreign ministers, Rais Yatim and Manouchehr
Mottaki. According to the Malaysian Foreign Ministry, the
Joint Commission addressed a very broad range of some 20
bilateral issues, including trade and investment, and
cooperation in oil, gas and petrochemical areas, as well as
science and technology. Public announcements from the two
countries did not broach particular political or security
issues. Mottaki paid a courtesy call on Deputy Prime
Minister Najib during the visit and their discussion centered
on economic matters, according to Iranian press accounts.


4. (SBU) Specific results from the Seventh Joint Commission
appeared limited, according to Malaysian pronouncements.
After the two-day meeting, FM Rais told reporters Malaysia
and Iran would establish a bilateral payment agreement
between their respective central banks needed to facilitate
trade. (Note: One Malaysian central bank official told
econoff he had not heard of any new agreements between the
two central banks. End note.) Rais also noted the founding

KUALA LUMP 00001045 002 OF 003


of an "executive council" to expedite bilateral trade; new
efforts to improve cooperation between the Malaysian
Industrial Development Authority and Iran's Organization for
Investment and Technical Assistance; and a cabinet-directed
initiative for the Export-Import Bank of Malaysia Bhd to
approve loans to housing developers in Iran. A number of
bilateral agreements on science and technology, higher
education, and human resources were reportedly "in process."

Rais and Najib: Business with Iran to Proceed
--------------


5. (C) Local press quoted FM Rais Yatim as encouraging
Malaysian firms to carry out trade and investment with Iran
despite sanctions imposed by the U.S. and the UN "because
(UN) sanctions are imposed in only three areas, which are
nuclear, defense and military... There is actually a lot of
potential (for) investing in Iran and (the Foreign Ministry)
will streamline any cooperation on this matter..."
Separately, Deputy Prime Minister Najib emphasized to the
Ambassador, in a November 11 meeting held only hours after
Najib received the Iranian Foreign Minister, that Malaysia's
"normal commercial business with Iran should proceed."

Malaysia Avoids Extensive Coverage
--------------


6. (SBU) Beyond comments by FM Rais, the Malaysian
government and the government-dominated mainstream press did
not provide extensive coverage of the talks with Iran nor
attempt to accentuate the importance of Malaysia's ties with
Iran. Malaysian newspapers carried brief reports for one day
only (November 12),and placed these far from the front page.

Iran More Effusive
--------------


7. (SBU) As reflected in English-language reporting from
Iranian media, FM Mottaki appeared more effusive than the
Malaysians about the importance of the talks and bilateral
relations. Mottaki's comments carried in the Iranian press
described Malaysia as an important Asian country that played
an active role in the Organization of Islamic Countries (OIC)
and the Non-Aligned Movement (NAM),and shared many common
views with Iran. FM Mottaki called for boosting cooperation
on issues concerning Central Asia, Africa, and the Middle
East, which would further upgrade the ties between Iran and
Malaysia. Iranian media sources played up the importance of
Iran-Malaysia economic relationship and intentions to expand
trade ties. The Tehran Times printed a reported statement by
FM Rais to the effect that, "Iran is regarded as one of
Malaysia's major trade partners.... (Rais) added that Iran is
the third trade partner of Malaysia in terms of the volume of
trade exchange between the two countries." (Note: This is a
gross exaggeration. According to official Malaysian
statistics, Iran is Malaysia's 31st largest trading partner,
and only accounts for .03% of all Malaysian international
trade. End Note.)

PM Abdullah Reportedly to Visit Iran in December
-------------- ---


8. (C) There was no public confirmation that Mottaki met
with Prime Minister Abdullah Badawi despite suggestions in
the press such a meeting would take place. However, senior
officials at the Ministry of International Trade and Industry
(MITI) told Econcouns on November 25 that Mottaki during his
mission extended an invitation for Prime Minister Abdullah to
visit Iran. Abdullah has reportedly accepted the invitation
and has begun to plan for a December 22-23 visit. A senior
MITI official assumed Abdullah would focus on potential
Petronas (the national oil/gas company) projects in Iran, as
well as other trade and investment opportunities as he did
during his recent visits to Uzbekistan and Turkministan.


9. (C) Comment: If we can confirm Abdullah's plans to
travel to Iran, we intend to request instructions from the

KUALA LUMP 00001045 003 OF 003


Department for the Ambassador to approach the Prime Minister
in advance of the trip. We would recommend points that
encourage Abdullah to use his discussions with Iranian
officials to reinforce the necessity of making progress in
international and EU-led mediation efforts on Iran's nuclear
program. End Comment.

MFA Halts Iranian Nobel Laureate
--------------


10. (SBU) Malaysia's ties with Iran were in the spotlight two
weeks before FM Mottaki's visit, as information became public
on the Malaysian Foreign Ministry's intervention to stop
Iranian Nobel Laureate Shirin Ebadi from taking part in the
prestigious "Bridges" international lecture series in
Malaysia (scheduled to take place one week prior to Mottaki's
visit). Organizers announced that the Foreign Ministry,
after protests from the Iranian embassy, had advised them in
writing to cancel Ebadi's participation. According to a
lecture organizer, Iranian students at the University of
Malaya threatened to hold a demonstration on the day of the
lecture, and the Iranian embassy "advised" that the lecture
should be canceled for "safety reasons."


11. (SBU) We obtained a copy of the MFA's letter to the
lecture organizers dated September 10, signed by MFA Under
Secretary for West Asia Hasrul Sani Mujtabar on behalf of
Secretary General Rastam (the Ministry's senior-most career
diplomat). The Malay-language letter stated, "The Foreign
Ministry takes note of the intention of the University of
Malaya to invite Nobel laureate from Iran Dr. Shirin Ebadi to
deliver a lecture on November 3, 2008. In this case, in view
of the good and close bilateral relations between Malaysia
and Iran, the act of inviting Dr. Ebadi, who is considered by
the Iranian government to follow the West's design and
agenda, is not appropriate. The Ministry is also of the
opinion that this would affect the bilateral cooperation
between the two countries in the area of education."


12. (SBU) Within days of the story leaking that the MFA
intervened to cancel Ebadi's lecture, and some critical
international commentary, FM Rais publicly stated that Ebadi
should be allowed to speak. Responding to reporters, Rais
reportedly said he was unaware of his Ministry's objection
and that the letter was "not official". Rais stated,
"Malaysia should allow the freedom of expression and
criticisms at the highest level. I will go and investigate
this matter." According to our subsequent inquiry with
University of Malaya officials, however, the university and
other organizers had not received any official word from the
Malaysian government reversing the MFA letter and Ebadi's
lecture has not been rescheduled. Poloff subsequently
contacted the MFA's Iran Desk and asked about Ebadi's
situation, but officials had no other information to share
with us.

KEITH