US Secretary of State Hillary Clinton said today that Muslim-majority Malaysia can be a global "thought leader", praising the multicultural nation's efforts to avoid religious rifts.

On a visit to cultivate ties with the moderate country, Clinton told an Islamic university forum in Kuala Lumpur that Malaysia can be influential among both the world's Muslims and the broader international community.

NONE "Malaysia, both by geography, (its) dynamism, the role that Islam plays, which is a role that is not divisive as it is in some parts of the world, has a real opportunity to be a thought leader in a number of significant areas," she said.

She lauded Malaysia's "creative approach" to Islamic finance and noted the presence of civil society group Sisters in Islam, which she said promotes the role of women within Islamic traditions.

The chief US diplomat praised the South-East Asian country's efforts to boost the economy while protecting the environment and "creative ways' to deal with deforestation.

Clinton made the remarks at the International Institute for Islamic Thought and Civilisation, where she fielded questions about US foreign policy in a programme broadcast on Malaysian television.

When he took office in January 2009, President Barack Obama vowed to get US relations with the Muslim world on a fresh footing after the previous administration of George W Bush.

Clinton also told students that the United States was working hard for a solution to the Palestinian-Israeli conflict, in response to an audience member's comment that Muslims were frustrated with a sense that America was pro-Israel.

She said the United States was equally supportive of the Palestinians and Israelis, backing a secure Israel living alongside a Palestinian state.

"It is important for a country like Malaysia to support Palestinians in their statebuilding," she added.

Later, Clinton held talks with Foreign Minister Anifah Aman. She was also due to meet Deputy Prime Minister Muhyiddin Yassin, who is standing in for Prime Minister Najib Razak, who has chickenpox.

She also met Malaysian women leaders, including top bankers.

Malaysia has positioned itself as a centre for Islamic finance, a booming trillion-dollar industry which follows religious laws prohibiting the payment and collection of interest.

Malaysia is the fifth stop on an Asia tour that has taken Clinton to Guam, Vietnam, China and Cambodia. She is still to visit Papua New Guinea, New Zealand, Australia and American Samoa.

Malaysia is also important as a member of the Association of Southeast Asian Nations, an organisation the Obama administration is trying to re-engage with after blaming the Bush administration for ignoring it.

Relations with Washington were rocky when Malaysia was led by Mahathir Mohamad, who was known for his strident criticism of the West during his two-decade rule, which ended in 2003.

The United States sometimes riled Malaysia with calls to expand democratic freedoms.

- AFP

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