I. Political Relations

On May 31, 1974.China and Malaysia officially established diplomatic relations. Since then, they have witnessed sound development in the political, economic and cultural fields. Starting from 1985, the Malaysian Government made gradual readjustment of its policy toward China, contacts at different levels have been continuously increasing between the two countries. Since the 1990s, as Sine-Malaysian relations reached a new stage for development, friendly contacts and cooperation have developed in various fields. The bilateral relations are currently at its best time in history and the strategic cooperation develops smoothly. The bilateral ties are entering into a new stage of maturity and all-round development.

Frequent exchanges of visits have been going on strong between the leaders of the two countries. Following are the Chinese leaders who have visited Malaysia: Vice-premier Deng Xiaoping (in 1978), State Councilor cum Foreign Minister Wu Xueqian (in 1984), Vice-premier Tian Jiyun (in 1986), President Yang Shangkun (in 1990 and 1992), Premier Li Peng (in 1990 and 1997), State Councilor cum Foreign Minister Qian Qichen (in 1991), Vice-Premier Yao Yilin (in 1992), Chairman of the Standing Committee of the NPC Qiao Shi (in 1993), State Councilor cum Secretary-General of the State Council Luo Gan ( in 1995), Chairman of the CPPCC Li Ruihuan (in 1995), Vice-Chairman of the Standing Committee of NPC Wang Hanbing (in 1997), Foreign Minister Tang Jiaxuan (in 1998) and Premier Zhu Rongji (in 1999). In 1994, President Jiang Zemin paid a state visit to Malaysia and went there again respectively in 1997 and 1998 to attend the first informal meeting between the leaders of ASEAN countries China, Japan and ROK.

In April 2002, Vice-President Hu Jintao paid an official visit to Malaysia. In May and July the same year, Vice-Chairman of the CPPCC cum President of Chinese Enterprise Federation Chen Qinghua and Vice-Chairman of the Standing Committee of the NPC Jiang Chunyan visited Malaysia successively. In January 2003, Vice-Premier Li Lanqing visited Malaysia. In July, Vice-Chairman of the Chinese People's Political Consultative (CPPCC) Huang Mengfu attended the 7th World Chinese Entrepreneurs Convention. In August 2004, the Sectary of the Secretariat of the Central Committee of the Political Bureau of the Communist Party of China He Yong visited Malaysia. In October, Member of the Political Bureau of the Central Committee of the Communist Party of China Wu Guanzheng and State Councilor of the State Council of China Tang Jiaxuan visited Malaysia.

Following are the Malaysian leaders who have visited China: Sultan Azlan Shah, (in 1990 and 1991), Tuanku Ja'afar (in 1997), Sultan Salahuddin(in 2001), Prime Minister Mahathir (in 1985, 1993, 1994, 1996,19999 and 2001), Vice Prime Minister Ghafar (in 1987), Vice Prime Minister Anwar (in 1994), Foreign Minister Badawi (in 1992 and 1997), Foreign Minister Syed (in 1999) and Senate Chairman Tan Sri Michael Chen Wing Sum (in 2002). In February and October 2001, Prime Minister Mahathir came to China to Asia Forum in Boao and APEC's informal summit in Shanghai. In September 2003 and May 2004, Abdullah Ahmad Badawi visited China in capacity of Deputy Prime Minister and Prime Minister respectively.

Consultation system was launched in April 1991 between the foreign ministers of the two countries and 9 rounds of consultations have been held. Apart form its embassy established in the other country, China has established its consulate-general in Kuching and Malaysia has set up its consulates-general in Shanghai, Canton and Hong Kong.

II. Trade Relations and Economic-Technological Cooperation Between the Two Countries

More than 10 agreements on economic and trade cooperation have been signed between the two countries such as Agreement on Avoidance of Double Taxation, Trade Agreement, Agreement on Investment Protection, Shipping Agreement and Air Transport Agreement. The joint committee of economy and set up in 1988 has convened 6 joint committee meetings.

The bilateral trade volume in 2003 reached US$ 20.13 billion, up 41% from the previous year, of which China's exports registered US$ 6.14 billion and its imports US$ 13.99 billion up 23.5% and 50.5% respectively. Malaysia continues to be the biggest ASEAN trading partner for China.

With sound development of economic cooperation between the two countries, mutual investment has kept increasing. By the end of September 2004, Chinese total investment in Malaysia reached US$ 102 million. In 2003, there were 350 Malaysian projects in China with their contractual volume reaching US$ 0.96 billion, up 20.8% from 2002, and their actual volume US$ 0.25 billion, down 31.8% from the previous year.

In 2000, Bank of China and Bank of Malaya set up its own branch respectively in Kuala Lumpur and Shanghai. In October 20002, the Chinese People's Bank and the National Bank of Malaya signed the agreement on bilateral exchange of currencies.

III. Exchanges and Cooperation in Other Fields

The two countries have seen sound development of exchanges and cooperation in the scientific, technological, educational, cultural and military fields. In 1992, Scientific and Technological Agreement was signed and the joint committee of science and technology set up, which held 3 joint committee meetings successively in 1994, 1999, and 2002. China and Malaysia also signed Agreement on Cooperation in and Exchange of Broadcasting and TV Programmes in 1992, Memorandum of understanding on Promotion of Sino-Malaysian Sport Exchange and Uplift of Standards of Physical Education in 1993, Memorandum of Understanding on Educational Exchanges in 1997, Agreement on Cultural Cooperation in 1999 and Memorandum of Understanding on Aviation Cooperation between China and Malaysia in 2002. The Chinese students studying in Malaysia have exceeded 10,000 and the Malaysian students in china surpassed 1,000.

In 1995, with the establishment of military attaché offices in both countries, China and Malaysia have witnessed growing contacts and exchanges of visits between their military circles. China's navy formation fleet visited Malaysia respectively in 199 and 2001. in August 2002, Malaysia's fleet visited China for the third time. In September of 2002, Vice-Chairman of the Central Military Commission, State Councilor cum Minister of Defence Chi Haotian made a stopover in Malaysia and had a meeting with Malaysian Minister of Defence Najib. In September 2003, Chief of the General Staff Liang Guanglie visited Malaysia and met Malaysian Prime Minsiter Mahathir and Minister of Defence Najib. In October 2004, Vice-Chairman of the Central Military Commission Guo Boxiong made a stopover in Malaysia and met Deputy Prime Minister cum Minister of Defence Najib.

The two countries had close cooperation in tourism. In 2002, Chinese tourists to Malaysia reached 0.557 million person-times, who were the major source of tourists for Malaysia. In the same year, Malaysian tourists to China reached NO.592 million person-times.

In 1991, China set up its Xinghua News Agency office in Malaysia. The Malaysian-Chinese Friendship Association and Chinese-Malaysian Friendship Association were founded respectively in 1992 and 1993. Prime Minister Mahathir was the guardian of the Malaysian-Chinese Friendship Association. Friendly relations have been established between Xiamen and Pinang Jiangsu and Malacca. In 1997, China Business Times set up its agency in Kuala Lumpur. In 2003, CCTV 4 and CCTV 9 were firstly broadcasted in Malaysia. In 2004, China News Agency opened its office in Kuala Lumpur.

IV. Other Issues Concerning the bilateral Relations

The two countries have disputes over the ownership of some shoals of the Nangsha Islands. Both sides have shown many times that they would work together to "reach the solution of this dispute in accordance with universally acknowledged principle of international laws including the UN convention of maritime law signed in 1982 through friendly consultations and talks between both sides so as to safeguard peace and stability in South China Sea."

V. Important Bilateral Documents

On 31 May 1974, Chinese then Premier Zhou Enlai and Malaysian Prime Minister Tun Razak signed Joint Communiqué, announcing the normalization and establishment of diplomatic relations between the two countries. In May 1999, Chinese Foreign Minister Tang Jiaxuan and Malaysian Foreign Minister Sayed Signed Joint Statement Concerning Future Cooperation Framework between the Government of the People's Republic of China and Malaysian Government in Beijing. On 31 May 2004, Chinese Premier Wen Jiabao and Malaysian Prime Minister Abdullah Ahmad Badawi signed Joint Communiqué, outlining the future development of bilateral relations.