Prime Minister Anwar Ibrahim met with Indonesian President Widodo where both leaders discussed border issues with Myanmar, trade and migrant worker rights.
Malaysia's new prime minister has met with Indonesia's president on his first foreign trip after winning a confidence vote and cementing his mandate last month following an inconclusive election.
Anwar Ibrahim, a long-time opposition leader, was sworn in as the country's 10th prime minister on November 24 to head a unity government in alliance with former political rivals.
He met Indonesian President Joko Widodo on Monday for talks at a presidential palace in Bogor, south of capital Jakarta where he thanked his counterpart for his support after the election.
"This is a bit personal, Mr President. When I was in a difficult situation, living in uncertainty and suffering, Indonesia welcomed me as a true friend," he said after the meeting.
He and his wife Dr Wan Azizah Wan Ismail arrived in Indonesia on Sunday for the two-day official visit.
Widodo said the world's two biggest exporters of palm oil would boost cooperation on the commodity and work together to battle "discrimination" against the sector, which environmentalists claim is stoking deforestation in both countries.
The European Union last month agreed on a new law preventing companies from selling products linked to deforestation.
"We have agreed to strengthen the cooperation through the Council of Palm Oil Producing Countries (CPOPC) to increase the palm oil market," he said.
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Discussed business, bilateral issues
The Indonesian leader also lauded the interest of Malaysian companies in investing in the country's new capital Nusantara, which is scheduled to open on the island of Borneo next year.
The pair then discussed other issues, including trade, border disputes and the situation in coup-hit Myanmar.
It is customary that the first foreign visit of a new Malaysian premier takes place in neighbouring Indonesia, which counts Kuala Lumpur as its fifth biggest export market.
Indonesia, the world's third-largest democracy, this year takes the chairmanship of the ASEAN group of Southeast Asian nations — in which junta-led Myanmar remains a member — and will host a leaders' summit in November.
They also spoke about migrant worker rights after Indonesia last year imposed a temporary ban on recruitment to Malaysia, where the majority of Indonesian migrant workers reside.
Eight Malaysian companies had also signed memorandums of understanding with Indonesian firms worth up to 1.66 billion Malaysian ringgit ($379 million), the Malaysian foreign ministry said in a statement.
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