True Lies, yeah, by James Cameron. It was about 50% awesome and 50% sewage, although I can personally squint past the sewage even if I can't entirely ignore it.
The racist stuff is worse with poor Grant Heslov than with Malik. Malik's terrorist is a bad guy, but he's not nearly the gibbering Arab most movies use; he's a much more relatable guy, probably a more well-rounded character than most actual terrorists. There are some weak cliches among the henchmen, but honestly it could have been so much worse.
Heslov plays the Arabic sidekick, and it's a less flattering role by far -- although he played an even worse version in another movie I liked, The Scorpion King, where he's the cowardly, weaselly secondhand-camel-merchant comic relief character. He's about as good in the role as anyone could be, but I still felt dirty laughing at it. And Carrere gets crapped on a fair bit, although not worse than her character would have if it'd been a Bond movie, which is more or less what Cameron was shooting at. Still, no white villains, eh? Throw a bone, Cameron.
True Lies walks an uglier line with its gender politics, actually. Curtis plays the wife who should just shut up and trust her husband whether he lies to her or not because he knows best. He neglects her and lies to her, blames her when the car salesman is after her, sets her up and humiliates her, and he gradually learns he should have just been honest with her . . . but the film still makes her the dope.
Tom Arnold is really funny in it, though, and Eliza Dushku gets fired out of a cannon.
Weird thing is, if Besson had made this movie in French with Jean Reno, they would have carried off the sexism without being offensive. This should not be true, but it is. The racism might have wound up being worse, though. Tough to say.