In the post-World War II era, aspirations for a cohesive and united nation led to the proposition of forming Malaysia. The idea, initially suggested by Singapore's leader Lee Kuan Yew to Tunku Abdul Rahman, Malaya's Prime Minister, aimed to merge Malaya, Singapore, North Borneo, Sarawak, and Brunei.^[83] The concept of this federation was supported by the notion that it would curtail communist activities in Singapore and maintain an ethnic balance, preventing Chinese-majority Singapore from dominating.^[84] However, the proposal faced resistance: Singapore's Socialist Front opposed it, as did community representatives from North Borneo and political factions in Brunei.

To assess the viability of this merger, the Cobbold Commission was established to understand the sentiments of Sarawak and North Borneo's inhabitants. While the commission's findings favored a merger for North Borneo and Sarawak, Bruneians largely objected, leading to Brunei's eventual exclusion. Both North Borneo and Sarawak proposed terms for their inclusion, leading to the 20-point and 18-point agreements respectively. Despite these agreements, concerns persisted that the rights of Sarawak and North Borneo were being diluted over time. Singapore's inclusion was confirmed with 70% of its population supporting the merger via a referendum, but with the condition of significant state autonomy.^[85]

Despite these internal negotiations, external challenges persisted. Indonesia and the Philippines objected to the formation of Malaysia, with Indonesia perceiving it as "neocolonialism" and the Philippines laying claim to North Borneo. These objections, combined with internal opposition, postponed Malaysia's official formation.^[86] Following reviews by a UN team, Malaysia was formally established on 16 September 1963, comprising Malaya, North Borneo, Sarawak, and Singapore, marking a significant chapter in Southeast Asian history.