Singapore gets RM2.4 billion worth of water subsidy from Malaysia since 1962

Singapore gets RM2.4 billion worth of water subsidy from Malaysia since 1962

KUALA LUMPUR, March 12: Based on the selling price of water to Singapore under the 1962 agreement, the island city-state can be said to have so far received at least RM2.4 billion, or RM42 million a year, or about RM100,000 a day, worth of water subsidy from Malaysia, the Dewan Rakyat was told today.

“If we count it as water subsidy we have given to Singapore, it is indeed happening. We sell water (to Singapore) at a very low price, but buy it back at a much higher price,” Foreign Minister Datuk Saifuddin Abdullah said in reply to Datuk Seri Dr Wan Junaidi Tuanku Jaafar (GPS-Santubong) during question time.

Wan Junaidi had wanted to know whether there was an element of subsidy in the agreement.

Meanwhile, Saifuddin also rapped his Singaporean counterpart Vivian Balakrishnan’s for criticising Malaysia’s move to review the 1962 water agreement in Singapore’s Parliament House by saying that Malaysia had lost its right to review the price of water after it chose not to seek a review in 1987 or 25 years after the signing of the agreement.

“Clause 14 of the agreement says that it (the agreement) shall be subject to review after the expiry of 25 years from the date of these presents…and not on the 25th year.

“So I don’t understand what English is used by the Singaporean Foreign Minister to interpret it in such a manner. We honour the agreement, that is why we say we can review the agreement after 25 years,” he said.

On Siti Zailah Mohd Yusoff’s (PAS-Rantau Panjang) supplementary question, Saifuddin said Malaysia is prepared to refer the case to the international arbitration court if negotiations with Singapore failed.

The issue relating to the water deal resurfaced in the middle of last year when Prime Minister Tun Dr Mahathir Mohamad criticised the price of raw water sold to Singapore as ‘unreasonable’ and said he planned to renegotiate the terms of the deal.

It is reported that the Attorney-Generals of both countries had also begun discussions on the matter.

“We should have been in the second phase right now where we look at price modality and what time periods for the price modality and related matters can be achieved,” Saifuddin said.

The water deal, which ends in 2061, entitles Singapore to receive up to 250 million gallons a day (mgd) of raw water from Sungai Johor.

Singapore pays 3 sen for every 1,000 gallons of raw water and resells treated water to Johor at 50 sen for every 1,000 gallons.

Johor obtains a daily supply of treated water up to 2.0 per cent or 5.0 mgd of raw water supplied to the city-state.

Meanwhile in a reply to a oral question by Wan Junaidi, Saifuddin said Singapore had also made allegations that they had made huge investment in Johor to construct and operate the Linggiu Dam and this has benefited Johor.

Replying to this claim, Saifuddin said the main objective of building the dam by Singapore was to ensure its interest to extract 250 million gallons of raw water daily from Sungai Johor under the 1962 Agreement was protected. 

He said the total investment was very small compared to the profits reaped by Singapore through the purchase of raw water at a very low rate. 

“In fact, Singapore is benefited directly from Malaysian investments such as the construction of the Sungai Johor barrage which ran into millions of ringgit. It is not inclusive of other costs shouldered by the Malaysian government to ensure sufficient water supply in Sungai Johor,” said Saifuddin.

He also said the republic’s foreign minister had also made statements painting a negative picture of the Malaysian government. 

Saifuddin said the statements which were negative and baseless did not reflect Singapore as a good neighbour and did not show the commitment of Singapore to foster bilateral relations between the two countries based on the principle of mutual respect and equality.

He said Malaysia is just claiming its legitimate rights as provided under the agreement.

Saifuddin said Malaysia would hold firmly to the principle of promoting friendly relations with all countries including Singapore. Despite being criticised unfairly, Malaysia will find a mutual solution on the issue through discussions and negotiations.

“However, if Singapore is adamant on refusing to resolve the issue through negotiations, Malaysia is prepared to bring the matter for arbitration as provided in the 1962 Agreement,” he said.


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