Growth with regional stability, peace

Aware of the fact that regional stability and peace is of utmost important for the country's growth, the Malaysian government continues to adopt its neutral foreign policy and to resolve through peaceful and friendly means in settling issues with its neighbors, especially with the other five member countries of the Association of Southeast Asian Nations (ASEAN), in which Malaysia is also a member.

For example, Malaysia has worked with Singapore to settle the ownership of Batu Puteh as it has done with Indonesia on the Sipadan and Ligitan Islands, off southeast Borneo, which have been long managed by Kuala Lumpur.

It did likewise with the Philippines over Sabah.

In 1992, it reached an agreement with Vietnam to jointly develop parts of the Spratlys, a group of oil-rich islands chain in the South China Sea which is also claimed either partly or wholly by Brunei, China, Taiwan, and the Philippines.

Relations with ASEAN members have been continually strengthened. As a matter of fact, Kuala Lumpur has announced its good will to expedite its timetable for meeting requirement of ASEAN Free Trade AREA (AFTA), in which it will protect only its most strategic industries for a ten-year period instead of the 15-year period set by AFTA.

Particularly with Indonesia, the two countries have made great strides in trade and technological cooperation when they signed agreements on investment guarantee and extension of trade cooperation early this year, during which Indonesia announced its willingness to buy the Malaysian-made aviation components for its state-owned IPTN aircraft industry.

In the financial sector, the two countries made an important breakthrough when Indonesia's market authority and the Malaysian Securities Commission agreed to promote cooperation both in the trading system and in the improvement of professionalism among market players.

Counter-trade deals were also made last May, under which the Bandung-based IPTN was to export six CN-235 transport planes to Malaysia as a barter for the 2,500 Proton Saga cars.

Originated from the Malay race and inherited with many similar traditions, the majority of both Malaysians and Indonesians surely have many things in common, enabling them to communicate much more easily than they do with people of different race.

Jakarta and Kuala Lumpur have also cooperated well in settling the problems of illegal Indonesian workers in Malaysia. The two countries have undertaken joint naval operations to crackdown the sending of illegal workers to Malaysia.