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S E C R E T SECTION 01 OF 04 KUALA LUMPUR 000859 
 
SIPDIS 
 
E.O. 12958: DECL: 10/19/2019 
TAGS: OVIP STEINBERG JAMES PREL PGOV ECON MY
SUBJECT: DEPUTY SECRETARY STEINBERG'S SEPTEMBER 28,2009 
MEETING WITH MALAYSIAN PRIME MINISTER NAJIB 
 
Classified By: Ambassador James R. Keith for reasons 1.4 (b and d). 
 
¶1. (SBU) September 28, 2009, 09:00 a.m.; Prime Minister's 
Office, Putrajaya, Malaysia. 
 
¶2. (SBU) Participants: 
 
United States 
------------- 
 
The Deputy Secretary 
Ambassador James Keith 
DNI Ambassador Joseph DeTrani 
Principal Deputy Assistant Secretary Joseph Donovan 
Deputy Assistant Secretary Scot Marciel 
OSD PDASD Derek Mitchell 
JCS RDML Leidig 
Special Assistant Pamela Park 
Economic Counselor Matt Matthews (notetaker) 
 
Malaysia 
-------- 
 
Prime Minister Najib Razak 
Badruddin Abdul Rahman, Acting Senior Under Secretary, 
Directorate of Europe, America, and Africa, MFA 
Mr. Akbar Samon, Principal Assistant to Special Officer to 
the Prime Minister 
Mr. Muhammad Radzi Jamaludin, Principal Assistant Secretary, 
Directorate of Europe, America, and Africa, MFA 
Mr. Edriely Ibrahim, Assistant to Special Officer to the 
Prime Minister 
 
¶3. (C) Summary: During a productive and wide-ranging policy 
discussion, PM Najib emphasized to Deputy Secretary Steinberg 
his commitment to strengthening bilateral ties with the U.S. 
Raising recent reports of transshipments to Iran via 
Malaysia, PM Najib told Deputy Secretary Steinberg that these 
were done without the knowledge of the GOM.  The PM 
emphasized that his government was taking steps to tighten 
export controls, and that he is committed to advancing 
Malaysia,s long-pending draft export control law.  Deputy 
Secretary Steinberg encouraged PM Najib to use Malaysia,s 
position as the new Chair of the IAEA BOG to press Iran to 
signal a change of course at the upcoming P5 plus 1 meeting. 
 On Afghanistan capacity building, the PM offered to see what 
Malaysia could do, suggesting that perhaps Malaysia could 
provide assistance and training in the law enforcement area, 
in Malaysia.  Steinberg encouraged Najib to consider 
conducting the training in Afghanistan if at all possible. 
 
¶4. (S) Summary (cont,d.): In other areas, Najib said that 
fighting global terrorism was high on his agenda and he noted 
ongoing concerns about the southern Philippines.  Deputy 
Steinberg thanked PM Najib for Malaysia,s helpful public and 
private communications regarding North Korea and urged close 
scrutiny of North Korean entities KOMID and Tanchon Bank in 
Malaysia.  On climate change, Najib said Malaysia remained 
supportive of the Kyoto protocol, but could not move beyond 
Kyoto until the government created a public consensus 
supportive of measures that required  lifestyle changes., 
The PM highlighted recent GOM efforts to improve Malaysia,s 
record on trafficking in persons.  The Deputy expressed 
appreciation for Najib,s engagement with the U.S. and 
stressed we were looking forward to the imminent publication 
of Malaysia,s new TIP National Action Plan.  Deputy 
Steinberg welcomed the PM's suggestion for initiating a 
high-level bilateral exchange.  The PM reiterated his desire 
to strengthen and deepen the bilateral relationship.   End 
Summary. 
 
¶5. (C) PM Najib welcomed Deputy Secretary Steinberg to 
Malaysia noting his visit was an important opportunity to 
exchange views. Najib said his telephone conversation with 
the President in late-June had been warm and productive, and 
added that he appreciated President Obama,s mention of 
Malaysia in his Cairo speech.  We bill ourselves as a 
moderate and progressive country, he said, and we like the 
world to see us that way.  There may be one or two things 
where it could improve, but Malaysia would not become a 
theocratic state, or extremist.  The Deputy Secretary told 
the PM the U.S. saw tremendous opportunity to develop our 
bilateral relationship.  The President had asked that he 
convey to the PM appreciation for his invitation to visit 
Malaysia.  The Deputy Secretary said that the President 
 
KUALA LUMP 00000859  002 OF 004 
 
 
considered Malaysia a key partner given its status as a 
progressive Muslim and pluralistic society. 
 
Non-Proliferation -- Iran and North Korea 
------------------------------------------ 
 
¶6. (C) PM Najib said his government wants to continue the 
dialogue with the U.S. on non-proliferation issues.  He noted 
concerns and press reports recently that had been raised 
about transshipments through Malaysia.  He said these were 
being done without the knowledge of the GOM.  He stated that 
his government was working on tightening up its export 
control regime, and that he was committed to passing 
Malaysia,s long-pending draft export control law, 
particularly for equipment that could be used by third 
countries for nuclear programs.  The Deputy Secretary told 
the PM that non-proliferation was one of the top priorities 
of the President and that the President viewed Iran as one of 
the most serious threats.  Malaysia, the Deputy suggested, 
should use its role as the new chair of the IAEA Board of 
Governors to help persuade Iran to change its course.  While 
the US did not object to Iran,s right to develop nuclear 
power, the recent revelation of Iran,s secret enrichment 
facility once again highlighted Iran,s continued pattern of 
deception with regard to its nuclear program.  The Deputy 
Secretary expressed hope that Iran would respond to 
international diplomatic efforts during the meeting October 
¶1. The U.S. did not want confrontation but it was 
unacceptable, he said, for Iran to be enriching uranium in 
violation of the UNSC Resolutions.  International cooperation 
to bring pressure on Iran was important to the success of 
these diplomatic efforts. 
 
¶7. (S) Limiting Iran,s financial entities, like Bank Mellat, 
also was part of this cooperative effort, the Deputy 
Secretary said.  We had not proceeded with designation of 
Bank Mellat,s subsidiary in Malaysia (First East Export 
Bank) pending this meeting, Steinberg advised, but our 
intention was to proceed.  Things have reached a critical 
stage with regard to Iran, the Deputy Secretary said. It was 
important to send an unequivocal signal to Iran that it 
needed to meet its obligations.  When the PM asked what 
signals the U.S. was getting from Iran, the Deputy Secretary 
replied that Iran,s test firing of missiles was the response 
the world had taken note of at present, but he hoped for a 
more positive response from Iran at the October 1 (P5 plus 
one plus Iran) meeting. He asked the PM to take advantage of 
Malaysia,s ties to Iran to help point out to the Iranians 
that the October 1 meeting represented a last clear chance to 
change course. The Deputy Secretary noted that Robert 
Einhorn, the Special Advisor for Non-Proliferation to the 
Secretary, would likely be coming to Malaysia in October to 
continue our dialogue on this and other non-proliferation 
issues. 
 
¶8. (S) Najib recalled a conversation before the start of the 
Iraq war in which he had predicted outside intervention would 
have the unintended consequence of creation of a new nexus 
between Shia,s in Iran and Iraq.  The Deputy Secretary 
commented that Secretary Clinton and others had discussed the 
Iranians,  influence in Iraq with Iraqi PM Maliki and 
others.  Iran, he added, had overplayed its hand and as a 
result had weakened its position in Iraq.  Closing out on 
non-proliferation, the Deputy Secretary thanked PM Najib for 
the good support Malaysia provided with regard to North 
Korea, including the helpful comments he made at an ASEAN 
summit meeting in Cheju.  But he stressed that the U.S. 
remained concerned about the operations of two North Korean 
entities, KOMID and Tanchon Bank.  Steinberg urged close and 
continuing scrutiny of the North Korean presence. 
 
Cooperation on Fighting Terrorism and Piracy 
-------------------------------------------- 
 
¶9. (C) PM Najib said Malaysia would play its part in managing 
common concerns like fighting global terrorism, which Najib 
said was high on his agenda.  While his government had 
succeeded in making Malaysia safe, Najib said ensuring that 
the situation in the southern Philippines did not deteriorate 
and allow AI Qaeda and JI to spread was a concern foremost in 
his mind. For Malaysia, the southern Philippines was the 
Achilles heel and it was for that reason the GOM placed 
importance on the negotiations there to deal with the serious 
threat presented by JI. The Deputy Secretary noted that there 
had been good cooperation and some success in this regard 
 
KUALA LUMP 00000859  003 OF 004 
 
 
already.  PM Najib pointed to Malaysia,s successful efforts 
to make the Strait of Malacca safe and secure.  He said 
Malaysia would continue to work in concert with its Strait 
neighbors to keep the number of piracy acts at a negligible 
level.  Najib noted Malaysia had made a small contribution to 
addressing the piracy issue off of Somalia. 
 
¶10. (C) On Afghanistan, PM Najib said Malaysia had offered to 
provide capacity building and reconstruction assistance.  He 
noted that the Afghan embassy in Malaysia was fully supported 
by the GOM and that Malaysia had provided disaster relief 
assistance to Afghanistan in the past. Najib told the Deputy 
Secretary that Malaysia would look into what it could do in 
terms of training Afghans, perhaps assistance focused on law 
enforcement.  The GOM,s preference, however, is for this 
type of training to be conducted in Malaysia.  The Deputy 
Secretary emphasized that it was important that our efforts 
in Afghanistan be part of a broader international approach. 
Malaysia,s contributions were important both in terms of 
substance and symbolism.  As such, the U.S. would like to see 
Malaysia undertake training in Afghanistan.  Our overarching 
goal, the Deputy Secretary said, is to ensure that extremists 
are not allowed to take hold and that Afghans have the 
opportunity to come together to build their nation.  Afghans 
needed to see that their government could provide security 
and stability and that other countries, such as Malaysia, 
were working cooperatively with their government to help 
achieve those goals. 
 
¶11. (C) PM Najib asked the Deputy Secretary about 
developments in Pakistan with regard to Afghanistan.  The 
Deputy Secretary said there had been a sea change over the 
last few months, driven in part by accelerated terrorist 
attacks by the Taliban inside Pakistan, which had convinced 
the government of Pakistan that extremists were a threat, not 
only in the Swat valley but across the country. PM Najib said 
the government in Afghanistan needed the support of 
Pakistan,s military and intelligence agencies but that, 
given the long-term relationships between those organizations 
and the Taliban, the degree of support was unclear.  The 
Deputy Secretary acknowledged that the situation was 
complicated and that there was a lot of history that came 
into play, but he stressed that there had been a strategic 
shift in thinking in Pakistan. 
 
Climate Change 
-------------- 
 
¶12. (C) The Deputy Secretary told the PM that climate change 
was a priority issue for the President.  There were some 
positive developments with regard to India and China as the 
U.S. explored options for all parties to the climate change 
discussions to undertake responsibility for differentiated 
but active measures to address the issue. Najib said that 
Malaysia was very supportive of the Kyoto Protocol and he 
welcomed the major shift in the U.S. administration,s 
position. The Deputy Secretary said the U.S. took its 
responsibilities seriously, but emphasized that all countries 
needed to contribute to the solution.  The Deputy Secretary 
noted that in the U.S., the President was moving things 
toward win-win solutions through the development of a green 
economy which could provide the basis for the next industrial 
revolution.  The PM said it was critical that major life 
style changes take place.  There were similar lifestyle 
problems in Malaysia, the PM said, but the government needed 
time to educate consumers so that new policies could be based 
on strong public support.  The PM said he had created a 
ministry for green technology which was focusing on renewable 
energy.  The Deputy Secretary commented that the UAE provided 
a good model for how traditional fossil fuel economies could 
diversify to renewable energy.  The U.S. was working with the 
UAE on renewable energy and on a safeguard agreement for its 
future development of civil nuclear power, including a plan 
to forego enrichment.  Malaysia was carrying out a review of 
its energy policy, according to the PM.  Malaysia, he said, 
needed more hydropower and was looking to reduce dependence 
on coal, because it was dirty, and on gas because it was 
scarce.  Malaysia was reexamining the role of nuclear power 
too, he added, but it was being considered as a last option. 
 
Trafficking In Persons 
---------------------- 
 
¶13. (C) Najib told the Deputy Secretary that his government 
had taken a number of significant steps to address this 
 
KUALA LUMP 00000859  004 OF 004 
 
 
problem in Malaysia, including the arrest of immigration 
officers implicated in trafficking/extortion schemes 
involving Burmese refugees.  He noted that his new ambassador 
to the U.S., Jamaludin Jarjis, had also discussed this issue 
with Senator Lugar,s staff.  The Deputy Secretary informed 
the PM that Secretary Clinton looked forward to seeing 
Malaysia,s National Action Plan for trafficking in persons, 
noting its publication would send a good signal for future 
cooperation on this topic. 
 
Possible High-Level Dialogue and the Economy 
-------------------------------------------- 
 
¶14. (C) PM Najib told the Deputy that he had sent Ambassador 
Jamaludin to the US with ministerial rank to emphasize the 
importance he attached to the relationship.  The PM also 
suggested that if both sides thought we needed a bilateral 
exchange at a higher level, the Malaysian side would be ready 
to support such a move and he would suggest a Malaysian to 
fill that role. The Deputy Secretary welcomed that 
suggestion, noting there was an opportunity to tap the 
potential of the bilateral relationship.  The Deputy 
Secretary added that more could be done to tap the potential 
of the economic relationship as well.  Commenting that he 
would be meeting later in the day with GE CEO Jeff Immelt, 
the PM agreed that more could be done on the economic 
relationship.  He said he was considering doing a road show 
in the U.S. designed to encourage more U.S. investment in 
Malaysia.  The PM then asked the Deputy Secretary about 
economic conditions in the US and unemployment.  The Deputy 
noted that economic growth had resumed but that unemployment 
was running around 10 percent.  While the recovery was 
underway, as the President noted at the Pittsburgh G-20 
summit, it was too soon to declare victory. Unemployment 
would remain high for some time and stimulus might still be 
needed to keep the economy on course. 
 
¶15. (C) The PM closed the meeting by reiterating his 
commitment to strengthening the bilateral relationship 
between Malaysia and the U.S.  All issues could be dealt 
with, he said. They were manageable, and none of them were 
insurmountable.  He asked the Deputy Secretary to convey his 
regards to the President. 
 
¶16. (U) This message was cleared by Deputy Secretary 
Steinberg. 
KEITH