Updated: 03/06/2014 22:39

Malaysia has lost right to review water prices: Shanmugam

Malaysia has lost right to review water prices: Shanmugam

Malaysia had the opportunity to review the water agreement with Singapore in 1987 but consciously chose not to do so. 

Taking members of parliament through a chronology of events, Foreign Affairs Minister K Shanmugam said this was because Malaysia benefits from the current agreement and have acknowledged as much. 

Mr Shanmugam highlighted that Johor buys 16 million gallons of treated water per day back from Singapore at a cost of 50 cents per one thousand gallons. 

This price is a fraction of the true cost to Singapore for treating the water, which includes the building and maintenance the infrastructure of water purification plants. 

"Malaysian leaders have acknowledged that Malaysia benefits from the current arrangement and explained that indeed that was why Malaysia made a carefully considered decision not to review the water price in 1987. Then Malaysian Prime Minister, Dr Mahathir Mohamad said in 2002 that Malaysia did not revise the water pricing when it was due, because they thought that Singapore would also revise the price of treated water supply to Malaysia."

Mr Shanmugam said on the basis that Malaysia chose not to review the water price in 1987, Singapore took actions that also benefited Malaysia, including the building of the Linggiu Dam in 1990 in Johor. 

He said the $300 million dam has increased the yield of the Johor River, and has enabled both Johor and Singapore to draw water from it during the current dry spell. 

Mr Shanmugam said neither party can unilaterally change any terms of the 1962 water agreement. 

He said it was guaranteed by both governments in the 1965 separation agreement, which was registered with the United Nations. 

Mr Shanmugam said any breach of the water agreement would also be a breach of the separation agreement, and also of International Law. 

As to the reports that Johor is considering a review of the price of water, Mr Shanmugam said there has been no official approach from Malaysia, and it thus would be premature to speculate on the impact of such an approach on bilateral relations.

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