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TOKYO: Malaysian Prime Minister Mahathir Mohamad said on Monday his country will remain friendly with China, which invested billions of dollars during the previous Najib Razak government, but will not be “indebted to China”.

Mahathir, in Tokyo on his first foreign trip since winning a shock election last month, sought to revive the idea of an East Asia economic group which he said would be useful in the face of China’s surging economic power.

“We have to deal with China whether we like it or not. We should deal with it as a group,” Mahathir told an international seminar in Tokyo.

Mahathir said he was not against pacts such as the Trans-Pacific Partnership (TPP) trade deal, but he said the TPP should be renegotiated so smaller economies like Malaysia can compete against giants China and the United States.

Mahathir said the ideal would be a broad trade pact such as the East Asia Economic Caucus (EAEC), which he proposed during his previous term in office.

“Yes, I am still in favour of EAEC,” he said.

“In the past, of course, we were not able to do this due to the objections of America, but now America seems to become isolationist again so it is not in a position to demand that we cannot form EAEC,” he added.

Mahathir, 92, returned as premier last month after a stunning election victory over Najib, promising to stamp out corruption and lower living costs.

His decision to visit Japan first was seen by some analysts as an example of the government’s desire to put some distance between Kuala Lumpur and Beijing.

New national car

Mahathir said he hoped to begin a new national car project to follow Proton, the company founded in 1983 during his first term but has struggled in recent years.

“We need to go back to the idea of a national car,” he told the conference. “Our ambition is to start another national car, perhaps with some help from our partners in Southeast Asia... we want to access the world market,” he said.

The national car has a troubled history in Malaysia, which from 1983 produced the Proton as part of then-premier Mahathir’s ambitious national industrialisation plan.

Published in Dawn, June 12th, 2018