MFA Spokesman's Comments

Asked to comment on Malaysia's Prime Minister Mahathir Mohamad's remarks as reported in The Straits Times of 23 October 2002 ("S'pore 'shows no desire to reach deal on water'"), the MFA Spokesman said:

"It is not correct to say that Singapore "shows no desire to reach deal on water", as Singapore wants to buy water from Malaysia beyond 2061 when the 1962 Water Agreement expires, if the price is right.

On specific points, the MFA Spokesman said:

On the comment: "Everytime we go to Singapore, they want to talk only about water, unless we solve that problem, we can't do anything. So I said, all right, let's focus on water."

- It is also incorrect that Singapore wanted to focus only on water. In fact, Singapore has sought to discuss all issues as a package. As part of the package, Singapore had been prepared to discuss subjects such as a bridge to replace the Causeway at Malaysia's request. It is Malaysia which wanted to discontinue the package approach. Prime Minister Mahathir said this in his letter of 7 October 2002 to Prime Minister Goh:

"... Malaysia has now decided to discontinue the package approach and to give the highest priority to first resolving the long delayed water issue, particularly the price review of raw water."

- This letter was written a day before Prime Minister Goh called on him in Putrajaya on 8 October. Prime Minister Goh had no inkling of this letter until he received it on 10 October.

- Malaysia's decision to discontinue the package was not put as a proposal to Prime Minister Goh and to ask if Prime Minister Goh agreed. It was a unilateral decision of Malaysia's.

On the comment "there is room for trade-offs always, but it seems to me that there is no desire on the part of Singapore to make a compromise."

- Singapore has always urged that the package of issues be considered together as it enables trade-offs to reach a win-win solution. Singapore had offered various trade-offs in order to reach a win-win solution as part of the package.

On the comment that Singapore had cut back its offer from 45 sen to 12 sen:

- This is a gross misinterpretation of Singapore's position.

- The 12 sen is not an offer from Singapore. It is Singapore's calculation of what the revised price of raw water would be if we proceed strictly on the basis of the factors in the review clauses. It was made clear to the Malaysian delegation at the talks in Johor Baru that the 12 sen was not an offer but a calculation.

- Our previous offer of 45 sen for current water had been in conjunction with Malaysia's offer of 60 sen for future water.

- But Malaysia withdrew its offer on 4 March 2002 and tabled new proposals including raising the price for current water to RM3. In effect, they rejected the 45 sen offer, which is therefore no longer on the table. Malaysia now wants to postpone discussion on the price and quantity of future water till 2059.

- Since Malaysia has unilaterally abandoned the package, Singapore has no choice but can only go strictly by the letter of the Water Agreements.

- Foreign Minister Syed Hamid himself said so in a formal statement at the 1-2 July Ministerial Meeting that Malaysia will pursue the price review issue "consistent with the provisions of the two Agreements".

- To date, Malaysia, however, has not provided any justification for its price revision proposals nor has it explained how its proposals are consistent with the factors listed in the Water Agreements.

On the comment that Singapore has refused to pay a higher price than 3 sen:

- Singapore's position is that Malaysia no longer has a legal right to a price review. But Singapore was prepared to discuss price revision as part of a package which included the supply of future water after 2061. We participated in the Senior Officials' Meeting in Johor Baru from 16-17 October 2002 in order to discuss all aspects of the water issue but Malaysia not only called off the package but even wanted to postpone discussion of future water until 2059.

MINISTRY OF FOREIGN AFFAIRS
SINGAPORE
23 OCTOBER 2002