Malaysia and Indonesia in the Middle East

Recent Features

ASEAN Beat | Diplomacy | Southeast Asia

Malaysia and Indonesia in the Middle East

The two Muslim-majority Southeast Asian states cannot avoid domestic implications from their policies toward the Middle East.

Malaysia and Indonesia in the Middle East

Indonesian President Joko Widodo walks with the UAE’s Sheikh Mohammed Bin Zayed, crown prince of Abu Dhabi, during the latter’s state visit to Indonesia, July 24, 2019.

Credit: Facebook/ Presiden Joko Widodo

In recent weeks Malaysian Deputy Foreign Minister Datuk Kamarudin Jaffar visited Tukey, Qatar, and Iran to shore up support in the Muslim world. Meanwhile, the UAE announced that it would invest $10 billion in Indonesia’s sovereign wealth fund.

Such news are just the latest points of contact between these two Southeast Asian states and the Middle East. But what is the nature of these two countries’ relations with the region more generally? What challenges do states like Indonesia and Malaysia face when operating in an environment that has become increasingly turbulent and multipolar, especially in the decade since the Arab uprisings in 2011?

Such questions are at the heart of my latest peer-reviewed academic article published last month. As middle powers, Indonesia and Malaysia have less space to operate than larger, powerful states like the United States, but more than exists for small states. Consequently, they have some freedom of maneuver, but will also find that there are limits to their choices. They have to juggle their responses, by accommodating regional actors as well as holding them at bay where necessary.

Pointing out the constraints faced by middle powers in the international sphere is not in itself new. Instead, what is pertinent is the extent to which foreign policy and domestic issues are intertwined in the case of countries like Malaysia and Indonesia. While the Middle East may often seem far away to Malaysians and Indonesians, the reality is that its various developments and tensions have a strong impact on the politics, societies, and economies of the two Southeast Asian countries.

Indeed, the Middle East’s rivalries and conflicts have long affected Malaysia and Indonesia’s engagement with the region. Chief among them has been the influence of Saudi Arabia. Economically, Saudi Arabia, along with the UAE, is the two countries’ largest regional trading partner, as well as being a major investor (although Indonesia’s President Joko Widodo was disappointed not to have acquired more funds than he did during his Gulf tour in 2015).

In religious terms, Saudi Arabia has been a prominent destination for many Indonesian and Malaysian Islamic scholars to train. Saudi Arabia has also been a major supporter and donor toward religious activities, projects, and higher education institutions in both Indonesia and Malaysia.

Politically, Saudi influence has also been felt at the elite level. A corruption scandal was exposed in 2015 when it was revealed that $700 million had been siphoned out of the 1MDB state development firm to Prime Minister Najib Tun Razak’s private bank account – which resulted in a guilty court conviction in 2020. Najib claimed that the sum had been a donation from the Saudi royal family to support Najib’s election campaign two years earlier.

Given the strong Saudi presence in both countries, the Malaysian and Indonesian governments have been under pressure to follow Riyadh’s line in recent years. That has included support for the Saudi-led military campaign in Yemen in 2015, its blockade of Qatar during the Gulf crisis between 2017 and early 2021, and its opposition to the 2015 Iran nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA).

When it comes to both Qatar and Iran, Malaysia and Indonesia largely resisted Saudi demands. However, in the case of Iran they were unable to disregard U.S. pressure when then-President Donald Trump withdrew from the JCPOA in 2018 and reimposed sanctions. Indonesia’s Pertamina oil company withdrew investment in 2018 while Malaysian banks began closing accounts belonging to Iranians a year later.

Malaysia’s stance was also more ambivalent with regard to Yemen. Malaysian troops were dispatched to Saudi Arabia after 2015, but recalled in 2018 when the country’s first government without the United Malays National Organization (UMNO) was elected. That new government, which lasted until early 2020 and was led by former Prime Minister Mahathir Mohamad, also closed down the recently established Saudi-backed King Salman Center for International Peace. Mahathir organized a summit of Muslim-majority countries in Kuala Lumpur in December 2019, which included leaders from Turkey, Qatar, and Iran. The summit generated criticism from the Organization of Islamic Cooperation and Saudi Arabia and the UAE stayed away.

Besides the strong Saudi connection, the most prominent regional development of the past decade has been the Syrian civil war. For both Malaysia and Indonesia, their ability to affect change on the ground has been extremely limited. At the same time though, middle power leadership has been possible – so long as it acknowledges the constraints within which it can work. Following the Syrian regime’s chemical weapon attack against the opposition in 2013, the Americans and Russians found themselves on opposite sides regarding intervention. Indonesia’s then president, Susilo Bambang Yudhoyono (SBY), leveraged his country’s presence at the G-20 summit to find a middle way out of the immediate crisis while focusing on what was possible, in particular humanitarian assistance.

Beyond SBY’s limited diplomacy, Indonesian and Malaysian responses to the Syrian war have focused more on containing domestic blowback. Security-conscious political elites in Jakarta and Kuala Lumpur have concentrated on countering the rise of Islamic extremism and appeals by jihadist groups like the Islamic State after 2014 to attract citizens to join them as foreign fighters in Syria or undertake action at home.

In response, the Malaysian and Indonesian governments adopted different approaches to tackle the threat of radicalization. Broadly put, Malaysia took a top-down approach through the Prevention of Terrorism Act in 2015, which allowed suspected terrorists to be detained for up to two years or more. In Indonesia, state action was complemented with activity by different agents, from the security services to also include local authorities and the two largest Muslim social movements in the country, Nahdlatul Ulama and Muhammadiyah.

In sum, the fusion between domestic and international factors in relation to Malaysia’s and Indonesia’s relationship with the Middle East led to a variety of different state actions. Since 2011, governments in the two countries have adopted positions that have both complemented and been at odds with different actors like Saudi Arabia, Iran, and the U.S. in the region. Kuala Lumpur and Jakarta have supported the various regional players, opposed them and stood apart from them, sometimes often at the same time. This has resulted in an orientation that international relations scholars have called “hedging.”

Hedging is an approach that other middle and rising powers like China have also adopted in the Middle East, given the regional turmoil. But while hedging may be the most favored strategy for now, a big question remains: What happens when the region starts to settle or outside powers like the United States and China start to impose a more bipolar “Cold War” on the region? What then will be the approach taken by middle powers like Indonesia and Malaysia, whose regional relations are fused with domestic considerations?