Thailand-Malaysian ties can do much more

Two dominant narratives continue to shape Thailand-Malaysia relations. One says it is “all about the southern provinces.” The other insists “the sky's the limit.”

Since July 28, however, new trends have emerged, showing Malaysia as a valuable strategic and economic partner—something Bangkok has long underestimated.

Thailand’s choice of Kuala Lumpur as the venue for ceasefire negotiations with Cambodia was significant. Prime Minister Anwar Ibrahim hosted the talks, marking a departure from Bangkok’s past reluctance to allow outside facilitators.

For years, Thailand insisted on keeping peace efforts in-house. This time, through Anwar’s good offices and timely intervention by US President Donald Trump—using personal leverage over tariff disputes with both countries, helped push the parties toward ending their artillery exchanges.

That decision caused a paradigm shift. Malaysia now matters more than ever in Thailand’s strategic calculus.

By 2027, the two countries will mark the 70th anniversary of diplomatic relations. Both sides are now engaged in serious reflection, asking whether the past can provide a roadmap for the future.

The inaugural Thailand-Malaysia Strategic Dialogue, held recently in Kuala Lumpur, was a concrete step.

For the first time, diplomats and policymakers sat together in an institutionalized framework, aiming to break away from old stereotypes and design a forward-looking agenda.

Chairman of ISIS Malaysia, Datuk Prof. Dr. Mohd Faiz Abdullah, wisely noted that the two countries’ shared history is the bedrock of their friendship and expressed hope that the dialogue would turn that legacy into a roadmap for the future.

In response, Ambassador Lada Phumas reiterated that Thailand and Malaysia must strengthen political trust, deepen economic resilience, and enhance connectivity. Faiz and Lada were on the same page that the two countries must also take on key regional and global issues such as climate change and digital transformation.

The insurgency in Narathiwat, Yala, and Pattani remains the main stumbling block.

Since the 2004 incident, it has become increasingly clear that any durable settlement requires better synergy at the national and provincial levels. Authorities from both sides know this, even as the issue continues to cast a shadow over bilateral ties.

From the start, Malaysian leaders have maintained that Thailand’s stability is crucial to prosperity across Southeast Asia. In the 1980s, Thailand lent its full support to Malaysia in combating communist threats.

For policymakers on both sides, this cooperation stands as a living testament to shared convictions. It has also become a barometer of bilateral health. Under Anwar’s leadership, the desire to elevate ties across all domains is stronger than ever.

The new strategic dialogue marks a turning point. Previously, both countries had not paid much attention to track-two diplomacy, as the official channels were plentiful through growing connectivity and ASEAN mechanisms.

But the complex realities of border management and the southern insurgency have repeatedly slowed cooperation.

Anwar has been enthusiastic in trying to resolve the insurgency, which has been the thorn in Malaysia’s ties with Bangkok. Malaysia wishes to see the common border areas turned into special economic zones that will benefit the people of both countries.

Last year, bilateral trade stood at just US$26 billion, making Malaysia Thailand’s fourth-largest partner after China, the US, and the EU.

Border trade with Malaysia accounted for 33 percent of Thailand’s total trade with neighboring countries. Investment, however, remains modest, with Malaysian investment in Thailand—ranked fourth—at about US$1.3 billion, while Thai investment in Malaysia was only US$481 million.

By contrast, tourism paints a brighter picture. Malaysian visitors remain among the top two groups of foreign tourists in Thailand. In the absence of Chinese arrivals, Malaysians have become the largest group, with five million crossing the border last year.

Malaysia’s recent facilitating role in the ceasefire agreement between Thailand and Cambodia has boosted mutual trust. This momentum should now be harnessed to finally put an end to the southern quagmire.

But for this to succeed, Thailand must also reciprocate and do its homework with clear policies and firm guidelines. Most importantly, both sides must have strong and sustained political will.

The convergence of conducive circumstances and constructive engagement now allows both sides to move their relations to the next level. Such prerequisites are essential if Bangkok and Kuala Lumpur are to find lasting solutions to their most persistent challenges.