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October 16, 2003

Transcript of Remarks by Minister for Foreign Affairs, Professor S Jayakumar, in Parliament in Response to a Question on the POA Concluded between the Governments of Singapore and Malaysia, 16 Oct 2003

[Dr Ong Chit Chung: Asked the Minister for Foreign Affairs what is the status of the Points of Agreement (POA), which was concluded between the Governments of Singapore and Malaysia in 1990, now that the package negotiations have been discontinued by Malaysia.]

REPLY:

1 Mr Speaker, Sir. Prime Minister Goh Chok Tong and myself have informed the House on 5 June 1997 as well as on several subsequent occasions on the full background and details concerning the Points of Agreement (POA) concluded between Malaysia and Singapore on 27 November 1990.

2 If I may recapitulate briefly, the POA is a Government-to-Government agreement between Malaysia and Singapore concerning railway lands in Singapore. It was signed on 27 November 1990 between then Prime Minister Lee Kuan Yew on behalf of Singapore and then Minister of Finance Tun Daim Zainuddin on behalf of Malaysia. Under the POA, the KTM railway station would be vacated and moved from Tanjong Pagar to Bukit Timah in the first instance. The land at Tanjong Pagar would then be vested in a limited company for joint development (60% for Malaysia and 40% for Singapore). All railway lands south of Bukit Timah other than Tanjong Pagar would revert to Singapore. When the MRT station reached Woodlands, and that took place on 10 February 1996, KTM may within five years, move its station from Bukit Timah to a site in Woodlands adjacent or close to the Woodlands MRT station. In that event, two additional pieces of land in Kranji and Woodlands would be vested in the limited company also for joint development. All other railway lands south of Woodlands other than Tanjong Pagar, Woodlands and Kranji sites would revert to Singapore. The POA was explicit that there will be no other compensation for Malaysian railway land outside the three big pieces at Tanjong Pagar, Kranji and Woodlands.

3 As Members know, Malaysia has not implemented this relocation of the railway station from Tanjong Pagar as stipulated under the POA. We have tried to work with Malaysia to implement the POA. However, after signing the Government to Government Agreement, the Malaysians wanted variations of the POA to include additional parcels of land. Sir, we were prepared to consider their proposals as part of the package of issues.

4 However, now that Malaysia has discontinued the package approach, the basis to consider Malaysia's request for variations of the terms of the POA no longer exists.

5 Sir, Malaysia also took the position that the POA becomes operative only when Malaysia decides to move its station from Tanjong Pagar. In an exchange of letters in 1997 between myself and then Foreign Minister Abdullah Badawi, we clearly spelt out Singapore's position on the law, which was that the POA became operative on the day it was signed, that is, 27 November 1990. Moreover we pointed out that Malaysia had in fact taken steps to implement the POA. However, Malaysia reiterated its stand and its interpretation that the POA would become operative only when Malaysia decided to move the KTM railway station from Tanjong Pagar.

6 Therefore Sir, the dispute centres on the legal interpretation of when the POA becomes operative. The Singapore Government's position is that this issue can be easily and amicably resolved by international adjudication at the International Court of Justice (ICJ) or through international arbitration at the Permanent Court of Arbitration (PCA). We have sent a Third Person Note to Malaysia on 26 September 2003 proposing that we adopt this approach on the POA issue. And we are awaiting Malaysia's reply.

7 Sir, members are aware that several outstanding bilateral issues like Pedra Branca and reclamation have already been referred to the process of international arbitration or the ICJ. On the water issue, Prime Minister Mahathir himself has publicly advocated the arbitration approach. In August last year, Malaysia also took initial steps towards arbitration by serving formal notice to review the price of raw water. Singapore reserved our position on Malaysia's right to review. But we have stated that the dispute should be resolved through arbitration in accordance with the provisions in the Water Agreements.

8 Sir, our proposal for resolving this matter is also consistent with what Malaysia has stated publicly. The Prime Minister of Malaysia was reported in the New Straits Times on 8 September 2003 to have said, and I quote:

"...if we can no longer negotiate, then we should have arbitration. That should be the way. If we want to settle the matter, then we need a third party."

He repeated this stance in his Budget Speech on 12 September this year, and I quote:

"When two parties are unable to resolve dispute through negotiations, then there is a need for a third party to arbitrate. We are willing to seek arbitration."

9 Sir, we share this view, that where negotiations fail to resolve an outstanding issue, we should refer it to third party adjudication or arbitration especially, Sir, where it turns on a legal issue.

10 Hence, our proposal that this approach be adopted for the POA issue as well. Rather than allow it to trouble the relationship, I think it would be in the interests of both Malaysia and Singapore to seek amicable resolution of the issue through international arbitration or adjudication. It would also be consistent with our approach on certain other bilateral disputes. More importantly, it will allow both countries to move ahead in bilateral issues and to focus on our many areas of mutual cooperation and interest.

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