Xi Jinping and the Sabah enigma
24 Oct 2013|

Chinese President Xi Jinping has been a busy man of late. Fresh from a whirlwind tour of central Asian states and international summits in September, he’s been on the road again—this time to Southeast Asia.

The Southeast Asian tour included official visits to Indonesia and Malaysia and the APEC conference in Bali. Xi signed economic agreements with Indonesia and Malaysia, while stressing the resurgence of a ‘Maritime Silk Road.’ Rhetoric of shared prosperity, growing mutual trade and ‘win-win’ situations was accompanied by a proposal for an Infrastructural Development Bank, all of which we were told would contribute to a new ‘diamond decade’ in China–ASEAN relations.

Everything seems to have gone according to plan in Southeast Asia. But did it?

Let’s return to late August this year. After a meeting with his Chinese counterpart Wang Yi in Beijing, Malaysian Foreign Minister Anifah Aman announced that Xi would visit Malaysia in October, spending 4–5 October in Kuala Lumpur and 5–6 October in Sabah. The planned visit was reported in the Malaysian press and the Sabah Chinese community began anxiously preparing for the occasion. However, cancellation of the Sabah visit was informally announced on 6 October, without explanation.

An enigma, indeed! Malaysia doesn’t encourage any visiting dignitary to travel to the Bornean states, and given that the programme was announced after talks in Beijing, it seems a reasonable assumption that the proposed visit was a PRC suggestion. But to what end was the visit proposed and why was it cancelled? We don’t have answers to these questions, but we can extrapolate on the basis of two factors—the sensitivity of Sabah for the Malaysian government and the potential importance of Sabah for the Chinese government.

The fragility of the Malaysian state isn’t always recognised. It’s only 50 years old, cobbled together in 1963 by a decolonising British Empire by bringing together the states and settlements of the peninsula with the state of Singapore (later expelled) and a number of British-associated territories in the north of Borneo. It was an unexpected nation, but it made sense from a British perspective in a Cold War context, as it constituted an anti-Communist bulwark in the middle of Southeast Asia between China and Indonesia.

Sabah, one of the two Bornean states shoehorned into Malaysia in 1963, remains an extremely sensitive part of the country. Malaysia has assumed the obligations of the former British North Borneo Company and continues to pay the heirs of the Sultanate of Sulu a recompense of 5,000 ringgit annually. In addition, the Philippines reasserted its claim to Sabah as recently as 2011 and in early 2013, there was a bloody stand-off between more than 100 Sulu people and Malaysian forces, over a territorial claim to the area. On the Sabah maritime borders, the overlapping South China Sea claims provide an even more complicating environment. There are also internal Christian-Muslim tensions.

Given these conditions, why then would the President of China have planned to spend half of his official visit to Malaysia in Sabah? Initial plans were apparently for him to open a Chinese consulate, a Chinese bank and a Confucius Institute in the state capital Kota Kinabalu. The Chinese Consul-General in Kuching, Li Shugang, has suggested that China’s activities in the area will double if a consulate is opened in Sabah. At the same time, the Sabah government is actively promoting PRC investment in the state and business migrant delegations from China are being feted. Former PRC foreign minister Yang Jiechi visited Sabah in August last year to boost Chinese investment in infrastructure, palm oil processing and agriculture.

Even without a consulate, Chinese tourism to the area has boomed, with probably 300,000 PRC tourists expected to arrive in Sabah this year, on charter flights, which have increased by 90% over a year. The PRC naval training ship Zheng He has also just made a visit to Sabah.

But the most important role Sabah can play in China’s plans for the future derives from its location as the precise centre of maritime Southeast Asia. Given China’s claims to the majority of the South China Sea and its overall blue-water naval aspirations, a naval base located in Sabah would allow it unparalleled access to the South China Sea and to Southeast Asia more generally.

map of Malaysia

(Click to enlarge map) Sabah is located at the centre of maritime Southeast Asia.

This could occur by way of joint economic and defence agreements. At the recent 16th ASEAN–China Summit, Chinese Premier Li Keqiang urged bilateral joint development of South China Sea areas commonly claimed. Malaysia’s Prime Minister Najib Razak agreed that such discussions could be pursued. Also, after meeting PM Najib, Xi Jinping reported: ‘We have agreed to strengthen our partnership with naval defense, joint military exercises to combat terrorism, transnational crime and promote security. This will create a sound environment for peace and the prosperity of both countries.’ Any such joint defence arrangements or military activities may well include naval facilities in Sabah.

And longer-term possibilities and calculations shouldn’t be excluded. The relations between Kuala Lumpur and the Bornean states have always been fractious and the incongruousness of having two parts of a nation divided by ethnicity, economic interests, perceptions of exploitation, and by a huge swathe of sea is increasingly apparent.

It’s not difficult to imagine a situation where the existing cleavage between the peninsular and Bornean states of Malaysia widens to a degree where any existing national unity dissolves. If that happened, any entity with established economic interests and political links with Sabah would be well-positioned, and could provide any new state with economic benefits far beyond those which Kuala Lumpur currently assigns it. The stationing of naval forces would then be a matter of formality.

As we ponder the reasons behind the planning and then the cancellation of President Xi’s visit to Sabah, both the domestic situation of Sabah within Malaysia and China’s aspirations within Southeast Asia are informative. The complexities of the Sabah situation, historical and otherwise, also suggest that this former backwater of Southeast Asia will not long remain in the shadows and will likely soon become a rather prominent pawn in the global competition within Southeast Asia.

Geoff Wade researches China–Southeast Asia relations. He developed the China–ASEAN and China–India Projects at the Centre of Asian Studies, University of Hong Kong and subsequently worked with the Southeast Asia–China Cluster of the Asia Research Institute, Singapore.