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Malaysia courts Gulf investment and economic ties, but Saudi relations remain question mark

A Scandinavian Airlines (SAS) Boeing 737-700 aircraft (background L) is seen past an AirAsia plane at Langkawi International Airport on the Malaysian resort island of Langkawi on March 2, 2024, ahead of the expected departure of Norway's King Harald V who has been hospitalised on the island. Norway's King Harald V, aged 87 and in poor health, is expected to return in "a few days" from Malaysia where he is hospitalised, the royal household said February 29. (Photo by Mohd RASFAN / AFP) (Photo by MOHD RASFAN/
To:

Al-Monitor Readers

From:

Samuel Wendel

Senior Market Research Analyst, Al-Monitor

Date:

May 17, 2024

Bottom Line:

Gulf-Malaysia trade and investment ties have been heating up lately: on May 15, a consortium including UAE sovereign wealth fund ADIA announced a bid to privatize Malaysia Airports, a deal valuing the airport operator at $3.9 billion. That comes as Malaysia and the UAE are scheduled to finalize a free trade agreement in June 2024. These developments arrive amid a Gulf charm offensive under Malaysian Prime Minister Anwar Ibrahim, who took office in 2022. Crucially, that includes efforts to boost Saudi relations, which cooled after Malaysia’s infamous 1MDB wealth fund scandal ensnared Gulf money. Fallout from that continues: On May 23, word came that 1MDB is suing an executive of the firm PetroSaudi for $1.83 billion. However, Riyadh could be warming to new Malaysian opportunities: Reuters reported May 6 that state oil giant Aramco may buy Shell’s gas station business in Malaysia, a deal potentially worth $1 billion.