The Chinese government said any problems Malaysia has with multibillion-dollar Chinese-backed infrastructure projects should be handled through "friendly negotiation."
The foreign ministry in Beijing defended China's projects in Malaysia, saying in a statement faxed to The Associated Press today that such deals have brought tangible benefits to the two countries.
Malaysian Prime Minister Mahathir Mohamad told the AP in an interview yesterday that Malaysia was looking to cancel Chinese projects signed by the previous scandal-tainted government as it digs itself out of debt.
Mahathir said he wanted to maintain good relations with China and welcomed its investment, so long as the projects benefit Malaysia.
But he took his toughest stance yet on Chinese-backed energy pipelines and a rail project along peninsular Malaysia's eastern coast.
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