Malaysia, Singapore agree to defer HSR project

Economic Affairs Minister Mohamed Azmin Ali with Singapore Transport Minister Khaw Boon Wan.

PUTRAJAYA: Malaysia and Singapore today signed an agreement to defer the planned high-speed rail (HSR) link between the two countries.

The supplementary agreement was signed between Economic Affairs Minister Mohamed Azmin Ali and Singapore Transport Minister Khaw Boon Wan.

It was witnessed by Prime Minister Dr Mahathir Mohamad, his deputy Dr Wan Azizah Wan Ismail and Singapore’s Deputy Prime Minister Teo Chee Hean.

The agreement will see the project deferred until May 31, 2020. If by then Malaysia does not proceed with the project, it will also bear the agreed costs incurred by Singapore in fulfilling the HSR bilateral agreement.

Both ministers reaffirmed the mutual benefits of the HSR project, saying it would bring the countries closer together by improving connectivity, deepening people-to-people ties and catalysing further economic cooperation.

“During the suspension period, Malaysia and Singapore will continue to discuss the best way forward for the HSR project, with the aim of reducing costs,” they said in a joint statement.

In a press conference after the signing, Azmin said both parties agreed that the abortive costs to be paid by the Malaysian government as a result of the deferment are estimated at S$15 million, which needs to be paid before the end of January next year.

“We still have some space. I must thank minister Khaw for allowing us this opportunity to prepare and pay before January next year.

“As for the cancellation, in the event that we cancel the project, we will meet and discuss, but I think I do not want to jump to conclusions because the agreement was to continue with the project after May 2020,” he added.

In July, Singapore said it would seek to recover over S$250 million (US$181.66 million) in costs incurred to date should Malaysia cancel the project.