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SINGAPORE: The compensation to be paid by Malaysia to Singapore after the completion of the Kuala Lumpur-Singapore high-speed rail (HSR) project cannot be publicly disclosed because there is a confidentiality clause in the agreement between the two countries, the minister said. of Malaysia in the Department of Prime Minister (Economy) Mustapa Mohamed.
The project ended last Friday after the HSR agreement expired on December 31, 2020.
In a Facebook post on Monday (January 4), Mustapa said the compensation is “not punitive in nature” and is an amount that Malaysia will reimburse for the specific costs of the project that Singapore has already spent money on.
“We are awaiting the details of the Singapore costs, and once received, they will be reviewed before we confirm them. The types of claims made have already been agreed,” Mustapa said.
“However, the amount of compensation cannot be disclosed because, according to the Bilateral Agreement, both countries are subject to a confidentiality clause. However, my team and I will discuss with Singapore to share information on the amount of compensation a once it is finalized. Therefore, any compensation figure mentioned by either party is mere speculation, “he added.
Ong Ye Kung speaking in Parliament on January 4, 2021.
Speaking in Parliament on Monday, Singapore’s Transport Minister Ong Ye Kung also said: “The amount of compensation for the termination and the payment schedule are specified in our Agreements.”
“In addition, there is a small component of miscellaneous abortion costs for the suspension of the Malaysia-requested project that Singapore is currently verifying, before we ship it to Malaysia. Due to Singapore’s confidentiality obligations under the HSR Bilateral Agreement, we do not we can disclose the exact terms regarding compensation for the completion of the HSR Project, ”he added.
Mr. Ong said that the expense for the project so far is just over S $ 270 million.
READ: From Conception to Completion: KL-Singapore HSR Project Timeline Over 8 Years
The proposed HSR line aimed to reduce travel time between Singapore and Kuala Lumpur to about 90 minutes by train, from the current 11 hours on existing train services.
In September 2018, both parties agreed to postpone the construction of the HSR until the end of May last year. Malaysia had to pay Singapore S $ 15 million for the costs incurred to suspend the project.
Malaysia subsequently requested an additional seven-month extension to allow both parties to discuss and evaluate Malaysia’s proposed changes to the project.
Khaw Boon Wan, who was Singapore’s then Transport Minister, agreed to the “final extension of the suspension period” until December 31.
After the completion of the project was announced on January 1, Mr. Mustapa said that Malaysia will fulfill its obligations under the Bilateral Agreement and that both countries will initiate the necessary to determine the amount of compensation.
COVID-19 FORCED MALAYSIA TO RE-EVALUATE HSR: MUSTAPA
In his Facebook post on Monday, Mustapa explained that the Malaysian government was interested in the HSR project, but the COVID-19 pandemic has forced it to reassess the situation.
He noted that similar rail projects in Japan and Taiwan have proven to be catalysts for economic development and the project would have reduced carbon emissions due to reduced air travel between Kuala Lumpur and Singapore.
“However, the COVID-19 pandemic has changed everything,” Mustapa said.
“This pandemic has posed a great challenge for the health sectors and the economy as we have never encountered it. No one could have anticipated this pandemic and its devastating impact on the economy of Malaysia and around the world. This situation has forced the government to reevaluate the HSR project, “he added.
Commenting on earlier speculation that the HSR project will be replaced by a high-speed rail between Kuala Lumpur and Johor Bahru, Mustapa said the Malaysian government will conduct a “detailed study” to determine the next move.
“At present, any conversation about the KL-JB high-speed rail project is mere speculation,” he added.
