A Malaysian military official on condition of anonymity said the meeting held every two years by members of the Five Power Defense Arrangementmay discuse the issue of US plans to realign its troops in Asia in an effort to combat terrorism.

But predominantly Muslim Malaysia had said it will not allow the United States to establish military bases in the country but is prepared to have other forms of defence cooperation with Washington.

"We will not agree to this. But it does not mean we (US and Malaysia) cannot further develop bilateral defence relations outside this ambit," Najib Razak, defence minister said.

The Los Angeles Times newspaper reported on Thursday that the Pentagon was considering building new bases in Australia, Malaysia and neighbouring Singapore.

Australia, Britain, New Zealand, Malaysia and Singapore make up the FPDA, a 32-year-old group that acts as the bulwark for the defence of Singapore and Malaysia from external threats.

Another issue that would be discussed is Australia's stance on pre-emptive military strikes.

Some Southeast Asian countries reacted angrily when Australian Prime Minister John Howard first floated the issue of pre-emptive strikes late last year.

The five countries are expected to hold a major military exercise codenamed "Flying Fish" in the South China Sea from June 20 to July 5.

WAR.WIRE