Malaysia

March 2005 | Risk Summary

A row over claims to potentially oil-rich waters off Borneo island are worsening relations between Malaysia and Indonesia, already strained after a Malaysian crackdown on illegal workers, most coming from its poorer neighbour. The dispute between the two Muslim nations follows Malaysia's move to award oil exploration rights in the area, raising nationalist sentiments in Indonesia, which already awarded contracts in the region last year. Jakarta has dispatched Indonesian fighter jets and warships to the waters in a show of strength and intensive negotiation will be needed to prevent the problem

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