Italy–Malaysia relations: A cornerstone of Rome’s Indo-Pacific engagement

10 September 2025

In recent years, Italy and Malaysia’s bilateral relations have deepened significantly in both breadth and scope, driven by the efforts of multiple stakeholders. This process has elevated their partnership into a cornerstone of Italy’s growing engagement in the Indo-Pacific. Though it has not featured prominently in policy discussions, it should be recognised as a blueprint for effective European engagement with Southeast Asia and the wider Indo-Pacific.

Rome’s ability to position itself as a key partner for Putrajaya illustrates the important role that non-resident European middle powers can play in the region, moving beyond the prevailing emphasis on France and the United Kingdom that dominates current discussions. This development carries significance beyond national interests, reinforcing the European Union’s broader efforts to enhance engagement in regional affairs — a process that heavily depends on contributions from its member states.

Growing Italy-Malaysia ties

Malaysian Prime Minister Anwar Ibrahim’s official visit to Rome on 1–3 July marked a pivotal milestone in bilateral relations, taking place 37 years after the previous summit. The summit was the culmination of a quiet but steady process, mainly driven by economic cooperation, that has transformed the two countries into strategic partners. Private-sector activism has been instrumental in shaping this trajectory, supported by growing institutional commitment on both sides.

Anwar was accompanied by a substantial delegation comprising five ministers — Foreign Affairs, Transport, Agriculture, Investment, and Defence — underscoring the importance of the visit and the growing depth of Italo-Malaysian ties. Discussions during the summit highlighted the shared commitment to international law and a rules-based order, an affinity that enhances Rome’s image as a reliable and cooperative actor, further reinforced through its participation in multiple Indo-Pacific multilateral fora. Moreover, Meloni consistently portrays Italy as a trustworthy country capable of “building bridges” in an era of international instability, echoing the broader European efforts of establishing themselves as a “third pole” amid mounting Chinese assertiveness and American unilateralism.

Italy cannot rival the hard-power presence of France or the UK, nor does it aspire to. Instead, it has constructed a pathway based on economic cooperation, private-sector activism, and steady institutional ties, which over time create the trust needed to expand into political and security spheres.

Rome has also contributed to regional stability through four naval deployments in the Indo-Pacific since 2017, including promotion of freedom of navigation operations (FONOPs), thereby reinforcing its image as a valuable partner. As China’s assertiveness over its contested claims in the South China Sea grows, avoiding escalation and safeguarding vital trade routes has become a key priority for Putrajaya. In this context, Malaysia’s core interests are increasingly converging with those of Italy and the EU, as containing Chinese assertiveness represents a shared concern. Recent European contributions to the Indo-Pacific security architecture — operationalised through multiple naval deployments by France, the UK, Italy, Germany, the Netherlands, Spain and Norway — reflect this alignment. Moreover, adherence to multilateralism and the defence of international law constitute core principles for both sides, particularly against the backdrop of mounting global instability and growing American unilateralism.

The centrepiece of the three-day bilateral meetings was the Malaysia–Italy Economic Partnership Roundtable, which brought together over 50 major Italian companies, business associations and financial institutions, along with more than 30 Malaysian firms. Bilateral trade, currently standing at US$3.1 billion, is on the rise: up 9.3 per cent in 2024 compared to the previous year and 3.3 per cent in the first half of 2025. Within ASEAN, Malaysia is the second-largest market for Italian exports, accounting for 18.4 per cent of the total in the first quarter of 2025. The Italian government and companies are increasingly looking to expand in Malaysia — Southeast Asia’s third-largest economy and widely regarded as a gateway to the region.

From Malaysia’s perspective, stronger ties with Italy — the world’s eighth-largest economy, a G7 member and the EU’s second-largest industrial power — promise not only expanded trade but also greater access to technology transfer, advanced industrial machinery, and collaboration in green technologies and the energy transition. Mutual interest was evident during the visit, underscored by strong private-sector participation and Anwar’s satisfaction with Italy’s pledge to invest over US$1.8 billion in Malaysia.

Defence and energy cooperation have also intensified. During the visit, a government-to-government defence deal was finalised to deepen cooperation, including joint logistics and future procurements, with contributions from Italian defence champions Fincantieri and Leonardo. Fincantieri will support Malaysia’s naval renewal programme, while Leonardo is delivering two P-72M patrol aircraft and maintaining its established helicopter presence in Malaysia. In June 2025, Eni and Petronas signed a framework agreement in Kuala Lumpur to merge their upstream oil and gas assets in Malaysia and Indonesia into a 50:50 joint venture — another example of how private actors continue to step up bilateral engagement in strategic sectors.

Rome’s pragmatic, private-sector-driven approach

Italy’s efforts to establish deeper relations with Malaysia have been carried out through the contribution of multiple stakeholders, with the private sector at the forefront, and have resulted in growing engagement across different levels. As an export-led economy, Italian companies are particularly active in exploring new markets and benefit from the Sistema Italia framework — a coordinated mechanism linking embassies, trade agencies, cultural institutes, and chambers of commerce to promote Italy’s economic, diplomatic, and cultural presence overseas. Leveraging economic cooperation driven by private-sector activism has become a central feature of Italy’s informal Indo-Pacific strategy, enabling Rome — lacking the hard-power assets of France or the UK — to establish strong relations rooted first in trade and investment, and then gradually expanding into political and security dialogue.

This pragmatic approach offers a model for other European middle powers for three main reasons: it enhances European middle powers relevance; it capitalises on Southeast Asia’s growth-focused development model; and it minimises friction with China. Given its economic potential and centrality in the Indo-Pacific security architecture, Southeast Asia is attracting the sustained attention of global powers eager to strengthen their presence. In this competitive environment, European countries — excluding France and the United Kingdom, which already enjoy higher visibility — may struggle to present themselves as significant partners compared to other international and resident powers such as China, the US, Japan, India, Australia and South Korea.

Deepening economic cooperation, with the ultimate objective of upgrading these ties into political partnerships, offers a viable pathway for middle powers to demonstrate relevance. This is particularly significant since Southeast Asian regimes’ internal legitimacy is often closely linked to delivering sustained economic growth. At the same time, avoiding overly vocal declarations about enhancing their Indo-Pacific presence helps minimise irritation in Beijing. Since China remains the principal commercial partner for most European states, avoiding additional frictions is a central preoccupation in many capitals. In this regard, private companies can act as “silent agents” providing a discreet but effective means to advance national interests and foster partnerships in the region.

Beyond “like-minded” partners: Lessons from Italy’s Southeast Asian engagement

The Italian–Malaysian partnership also underscores a broader lesson for European countries: engagement with Southeast Asia must be placed at the centre of Indo-Pacific strategies. Formal frameworks adopted by countries such as the Netherlands and Germany tend to emphasise cooperation with “like-minded” partners — the United States, Japan, South Korea, India and Australia — as the primary avenue to expand their regional footprint, while the United Kingdom greatly relies on minilateral fora. Yet in an increasingly multipolar and unstable international system, diversification of partnerships has become essential. Rome has pursued this imperative by strengthening ties not only with allies but also with a broader range of Southeast Asian states, signing new agreements with Vietnam, Thailand, and Indonesia. Jakarta, in particular, emerged as the largest buyer of Italian armaments in 2024, and, alongside Kuala Lumpur, is set to deepen defence cooperation with Rome in the coming years.

Expanding relations beyond the circle of “like-minded” states inevitably raises challenges, particularly around human rights and political systems, which represent the most likely sources of friction in ties between Italy and Malaysia. Yet, strategic imperatives increasingly require Europe to temper its traditional naïveté. Pragmatism does not mean abandoning the promotion of European values, but it does require balancing them against geopolitical realities.

In practice, the convergence of interests between European and Southeast Asian partners often outweighs these potential tensions. As in the Italy–Malaysia case, shared support for multilateralism and international law creates strong normative alignment. At the same time, the mutual drive to diversify economic ties — amid US economic coercion and Chinese pressure on key European sectors — and the recognition of common security challenges provide a robust foundation for a deeper multilevel engagement.

Ultimately, what Italy’s engagement with Malaysia demonstrates is that European middle powers can establish themselves as credible partners if they play to their strengths. Italy cannot rival the hard-power presence of France or the UK, nor does it aspire to. Instead, it has constructed a pathway based on economic cooperation, private-sector activism, and steady institutional ties, which over time create the trust needed to expand into political and security spheres. This approach is not only pragmatic but replicable: other European states with similar constraints could follow a similar path. In that sense, the Italy–Malaysia partnership offers more than a bilateral success story: it provides a blueprint for how Europe’s less visible powers can remain strategically relevant in the Indo-Pacific.

DISCLAIMER: All views expressed are those of the writer and do not necessarily represent that of the 9DASHLINE.com platform.

Author biography

Emanuele Ballestracci is a graduate student in International Relations at the University of Turin, Italy, and recently a graduate visiting student at the Nanyang Technological University, Singapore, as a Zegna Scholar. He is a researcher at the Associazione Italia-ASEAN, a freelance consultant, and currently a visiting researcher at the Universiti Malaya. Image credit: The Government of Italy.