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PETALING JAYA: Malaysia’s proposal to remove the systems provider and network operator from the high-speed rail (HSR) project was the main stumbling block that led to the collapse of the HSR agreement with Singapore.
According to the Straits Times, Singapore’s Transport Minister Ong Ye Kung said they could not accept this “fundamental deviation” from the original bilateral agreement.
Speaking in Parliament today, he said that the disposal of this asset company (AssetsCo) was Singapore’s main concern in the discussions on Malaysia’s proposed changes to the project linking Jurong East and Kuala Lumpur.
The HSR project was terminated after Malaysia allowed the bilateral agreement to expire on the December 31, 2020 deadline and the two sides failed to agree on a number of proposed changes to the project.
“Because neither country has the experience and expertise in operating HSR,” he said, “we agreed under HSR’s bilateral agreement to name the best player in the industry through an open and transparent international tender to assume the role of AssetsCo.
“Once appointed, AssetsCo was required to supply the train system, operate the network, ensure that cross-border HSR service is given proper priority over Malaysian domestic service, and be accountable to both Singapore and Malaysia.”
He said Singapore viewed AssetCo as an integral part of the project and that it would minimize the possibility of future disagreements and disputes over the course of the project, which was expected to last decades.
“Therefore, Singapore informed Malaysia that the disposal of AssetsCo constituted a fundamental departure from the HSR bilateral agreement and could not be accepted.”
However, it did not indicate what the alternative proposed by Malaysia would have been.
An open tender was held in 2018 for the AssetCo role, just a few months before the deal was suspended for the first time.
Ong also said that Malaysia’s suggestion that the line link to KLIA, which would have meant sharing a runway with the existing KLIA Express line, also presented “many technical problems.”
“Having said that, the main concern for us was the disposal of AssetsCo,” the Singapore daily quoted him as saying.
The original agreement was signed in 2016 after three years of negotiations, and construction was suspended in 2018 at the request of Malaysia. This suspension was subsequently extended until December 31, 2020, with the explicit understanding that it would be the last extension.
Malaysia will now have to compensate Singapore under the HSR agreements, and the Prime Minister’s Department Minister Mustapa Mohamed has said that Malaysia will honor its obligations and initiate the necessary procedures to determine the amount of compensation.
