SINGAPORE FIRES WARNING SHOT EVEN AS MAHATHIR GOES ON CHARM OFFENSIVE IN CHINA TO GET NAJIB’S ‘LOPSIDED’ DEALS REVIEWED: WATER & HSR DEALS WITH MALAYSIA ‘SACROSANCT’, SAYS SINGAPORE PM

WHILE Singapore appreciates the new Malaysia government’s reasons to review and change various policies of the previous administration, Prime Minister Lee Hsien Loong made it clear yesterday that both countries have to adhere to agreed terms in the water deal and the Kuala Lumpur-Singapore high-speed rail (HSR) project.

Both issues have been sticking points in recent months, with Malaysia’s Prime Minister Dr Mahathir Mohamad repeatedly saying that his country is selling water to Singapore at too low a price, and most recently, suggesting that it should be raised by at least 10 times.

Shortly after winning the May 9 general election, Dr Mahathir had also said that Malaysia wants to cancel the HSR project, though Putrajaya has since shifted its position to wanting to defer the project.

Commenting on both issues for the first time at the National Day Rally, Lee stressed that the 1962 Water Agreement between the two neighbours is “sacrosanct”.

“We must proceed strictly in accordance with its terms,” he said.

Noting that Dr Mahathir’s comments on reviewing water prices are “not new”, since he had raised it multiple times during his first stint as premier from 1981 to 2003, Lee pointed out that Foreign Affairs Minister Dr Vivian Balakrishnan had also spelled out Singapore’s position in Parliament last month to “avoid any misunderstanding”.

Dr Balakrishnan had told Parliament that the 1962 agreement was guaranteed by both Singapore and Malaysia in the 1965 Separation Agreement, which was in turn registered with the United Nations.

“Any breach of the agreement would call into question the Separation Agreement, which is the basis for Singapore’s very existence as an independent sovereign state,” said the minister, adding that “neither Malaysia nor Singapore can unilaterally change the terms of this agreement between our two countries”.

The 1962 agreement, along with another 1961 agreement that expired in 2011, have long been points of contention.

Under the 1962 agreement, which will expire in 2061, Singapore’s national water agency PUB may draw 250 million gallons of raw water from the Johor River daily at 3 sen (1.03 Singapore cents) per thousand gallons.

In return, Johor is entitled to receive a daily supply of up to five million gallons of treated water – or 2 per cent of the water supplied to Singapore – at 50 sen per 1,000 gallons.

Singapore has said that the cost of treatment is in fact RM 2.40 per 1,000 gallons while Malaysia sells the treated water to Johor citizens at RM3.95 per 1,000 gallons.

Still, Dr Mahathir recently criticised the 1962 agreement as “too costly” and “manifestly ridiculous” while Malaysian Foreign Minister Saifuddin Abdullah has said that it could be reviewed – a suggestion which Singapore has repeatedly rejected, pointing out how Putrajaya had lost its rights to review the price of water in 1987.

Touching on the HSR project as well as the Johor Baru-Singapore Rapid Transit System (RTS Link), Lee noted that Singapore entered into these projects “in good faith” after careful negotiations as they will benefit both countries.

Lee said that Transport Minister Khaw Boon Wan and Malaysia’s Economic Affairs Minister Azmin Ali have met recently on the HSR issue and are trying to find a “constructive way forward”.

Lee emphasised that both the HSR and RTS deals are legally binding and clearly state the ramifications for the party wishing to change or terminate the agreements.

“Both sides have to carry out what has been agreed to, unless we mutually agree to vary the terms.”

Since defeating the Barisan Nasional pact in the historic May 9 polls, Dr Mahathir’s new administration has pledged to review all large-scale projects undertaken by the previous government to trim the RM1 trillion national debt.

The HSR project, first proposed by Malaysia in 2013, is a 350km line that would slash rail travel time between Singapore and Kuala Lumpur to 90 minutes when completed in 2026.

The RTS Link, an underway cross-border rapid transit system, would connect Woodlands in Singapore to Johor Baru.

Noting that Singapore has worked well with its closest neighbour over the years and collaborated on various projects with successive governments, Lee expressed hope that the Republic can continue to deepen its partnership with Dr Mahathir and his new team “to build on our deep partnership and make further progress together”.

“Ultimately, the fundamentals of our relationship with Malaysia have not changed,” said Lee, adding that both countries are closely bound by ties of kinship, history, geography and economics.

“We need to work together to tackle common challenges, and when our interests diverge, we must find constructive ways to resolve our differences.

“If Singapore-Malaysia relations stay stable and close, we can pursue win-win co-operation and we can also each focus on our own domestic priorities.”

Noting the global uncertainties amidst a trade war between the United States and China and questions over the existing international system, Lee also stressed that the role of the Association of South-east Asian Nations (Asean) is “all the more important”.

In this regard, Singapore needs to forge close relationships with its South-east Asian neighbours, especially its closest ones in Malaysia and Indonesia, where the election next year will see President Joko Widodo go up against former general Prabowo Subianto in a rematch of the 2014 polls.

Lee said he has worked well with Widodo, who will be his host when he goes to Bali for the annual Leaders’ Retreat in October.

“We have wide-ranging and mutually beneficial cooperation with Indonesia,” said Lee. “I hope this will continue.”

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