Since decolonisation, the international arms trade has become central to global politics. Newly independent states sought military equipment from major powers to defend against internal and external threats.
In response, countries such as the US, Russia, France and China built vast arms export industries that continue to shape geopolitical alignments.
Motivations for exporting weapons are multifaceted. Economically, arms sales generate revenue, sustain jobs and support research and development (R&D). Politically, they serve as instruments of influence, allowing suppliers to forge security relationships and gain military access. Exporting advanced systems also spreads high R&D costs across larger markets.
On the demand side, states purchase weapons primarily for national security and deterrence. Many developing countries lack indigenous defence industries and rely on foreign suppliers for sophisticated systems. Modernisation is another driver, and buying ready-made systems is faster than domestic development. Regional arms races also intensify procurement.
Despite these rationales, the arms trade remains controversial. It can fuel conflicts, empower authoritarian regimes and risk advanced weapons falling into non-state hands. International mechanisms such as the Arms Trade Treaty aim to regulate transfers, but enforcement is inconsistent due to major powers’ strategic interests, including double standards.
Malaysia’s decision to purchase Norwegian warships and weapons
In 2018, Malaysia decided to acquire the Kongsberg Naval Strike Missile (NSM) system from Norway. This was a response to urgent operational gaps within the Royal Malaysian Navy (RMN), specifically the need to replace the ageing Exocet MM40 Block II missiles that had become outdated in terms of range, survivability and guidance.
The NSM offered major advantages. Its range exceeded 185km, allowing engagement from ‘standoff’ distances. It featured stealth characteristics, imaging infrared seekers, GPS and inertial navigation for high accuracy in a heavy electronic warfare environment. The NSM was compatible with network-centric warfare and could strike both naval and land targets, greatly expanding flexibility.
The acquisition also fitted with Malaysia’s naval transformation strategy. It was intended to equip six Kedah-class patrol vessels and serve as the primary strike weapon for the new Maharaja Lela-class Littoral Combat Ships (LCS).
Strategically, the purchase reflected concern over rising naval competition in the South China Sea, including concerns about China’s rising naval power. The contract, signed in April 2018, was worth approximately 124 million euros. Overall, it represented a forward-looking investment to modernise Malaysia’s naval capabilities.
Why Norway cancelled the naval weapons contract with Malaysia
Norway’s cancellation marked a significant policy shift. The primary reason cited was the decision to prioritise sensitive military technologies for its closest allies and strategic partners amid worsening global security conditions.
Malaysia was not considered part of this core network. Norwegian authorities pointed to heightened geopolitical tensions and intensified great-power competition.
These factors led Western states to tighten export controls and impose alliance-based restrictions. At a technical level, the NSM contained US-manufactured gyroscope components. While Washington reportedly did not directly intervene, US export control regulations on third-party transfers of sensitive technologies played an indirect but critical role. Broader American policy favouring military supplies to treaty allies also contributed.
Norway insisted the cancellation was not specifically aimed at Malaysia. Nevertheless, diplomatic fallout was immediate. Prime Minister Datuk Seri Anwar Ibrahim called the decision unacceptable. Malaysia had reportedly paid approximately 95 per cent of the contract value before the cancellation.
Kuala Lumpur initiated compensation claims exceeding US$250 million against Kongsberg and signalled a possible reassessment of defence cooperation with Norway.
Strategically, the cancellation disrupted Malaysia’s naval modernisation. The LCS programme faced uncertainty, and delays could cost more than RM1 billion.
The episode underscored that international arms sales are deeply geopolitical, not purely commercial. Access to advanced military technology is shaped by alliances, export regulations, technological dependencies and strategic trust.
Implications for Malaysia and Asean
The cancellation was a major setback for Malaysia. While Anwar spoke of renegotiation and compensation, he recognised the negative impact on military readiness and the regional security balance.
Beyond operational concerns, the incident carried profound strategic lessons. Many observers in Southeast Asia interpreted Norway’s action as part of a wider pattern of Western unreliability, particularly against the backdrop of perceived double standards in Western foreign policy, including support for Israel’s military aggression and genocide in Gaza and South Lebanon, and the unprovoked attack against Iran.
This perception reinforces the view that the West can no longer be regarded as the world’s strategic, political or moral centre of gravity. Consequently, Norway’s action is likely to compel Malaysia and other regional states to diversify their defence procurement networks.
While Malaysia has historically used a multi-source strategy involving Western, Russian and Asian suppliers, the cancellation will deepen cooperation with alternative partners such as South Korea, Brazil, Türkiye, India and China. Diversification will reduce dependence on any single supplier, though it may create interoperability challenges.
The incident is also likely to accelerate the development of Malaysia’s domestic defence industry. Strengthening indigenous capabilities in shipbuilding, missile integration and defence electronics would improve strategic autonomy and reduce vulnerability to foreign political decisions.
Furthermore, the episode may encourage Malaysia to deepen regional defence cooperation within Asean and reassess its strategic alignment. At a time of rising geopolitical uncertainties, characterised by the ascendancy of the “rule of the jungle” over the “rule of law”, Western actions send a clear signal. States must undertake rapid armament to safeguard sovereignty and prevent future scenarios resembling Gaza, South Lebanon, Iran or even a hypothetical threat of Greenland being invaded by a US administration.
For many in the Global South, the West simply cannot be trusted and is increasingly perceived as an existential threat to world order.
The Norwegian decision thus sends an important signal: the West has returned to its predatory instincts. It has clinically eroded trust in Western defence suppliers, all connected through NATO, Western ideology and a strategic policy aimed at maintaining a neo-colonial order, “neocolonialism by ledger”, where arms suppliers can cut off supply at any time due to political and strategic shifts.
Clearly, Asean states cannot rely exclusively on arms deals with the West. Western policies are fundamentally based on a sense of cultural superiority that seeks to undermine the “rest”, particularly successful states outside the Western cultural orbit, such as Russia, China, India and Indonesia. Simply put, the West is not only unreliable but a guaranteed threat.
If Norway’s action offers any lesson, it is that the rising Western threat, unreliability and trust deficit, combined with the fact that US allies take their cue from Washington on weapons supplies to the Global South, create a dangerous new normal.
While the US has denied any role, US ITAR rules on components in third-party weapons sales may have been a key factor. As Norway invoked force majeure to void the agreement, other suppliers could follow suit, worsening Asean’s security dilemma.
Norway’s cancellation of the NSM contract serves as a stark reminder that national defence depends on far more than sophisticated weapons. Resilient supply chains, diversified partnerships, domestic industrial capabilities and strategic autonomy are equally vital.
For Malaysia, the incident offers an opportunity to reduce foreign dependency, build indigenous defence capacity and craft a more resilient procurement strategy.
In an era of rising geopolitical rivalry, middle powers must adapt or risk being left vulnerable by the shifting loyalties of their suppliers. The lesson extends beyond Malaysia to all Southeast Asian nations: strategic self-reliance is no longer optional but imperative in a world where even binding contracts can be voided by geopolitical calculations.
Predatory politics requires states to reduce their dependence on the West; otherwise, what Norway did to Malaysia will be repeated sooner rather than later across the rest of Southeast Asia.
The views expressed here are the personal opinion of the writer and do not represent that of Twentytwo13.
