The Kuala Lumpur-Singapore High Speed Rail (HSR) project was terminated because Malaysia had proposed to remove an assets company that had previously been agreed on, Transport Minister Ong Ye Kung said.
Speaking in Parliament on Monday (Jan 4), Mr Ong said that the original agreement between Singapore and Malaysia on the HSR had included the setting up of an assets company to act as a systems supplier and network operator of the HSR service, which would, in turn, ensure that the interests of both countries were protected.When Malaysia proposed to remove the assets company, Singapore was unable to agree to this “particularly significant change”, which constitutes a “fundamental departure” from the HSR bilateral agreement signed by the two neighbours in 2016, Mr Ong said.Mr Ong was responding to a question from Workers’ Party Member of Parliament (MP) Louis Chua, who had asked the minister to specify the substantive points of differences that had led to the HSR’s cancellation. The project was terminated on Jan 1, after both countries failed to reach an agreement on changes proposed by Malaysia by the deadline of Dec
Secrecy clause prevents disclosure of HSR payoff for Singapore, says M'sia ministerMr Ong said: “As the HSR is a cross-border service, it must be a single-train system operating between Singapore and KL, and Malaysia.“Because neither country has the experience and expertise in operating a HSR, we agreed under the HSR (bilateral agreement) to appoint a best-in-class industry player through an open and transparent international tender to assume the role of the assets company.”
Once appointed, the assets company would supply the train system, operate the network, ensure that appropriate priority is given to cross-border HSR service vis-a-vis Malaysia’s domestic service, he added.Pointing out that the assets company would be accountable to both countries, Mr Ong added: “To Singapore, (the) assets (company) is the centrepiece of the HSR project. It is necessary to ensure that the interests of both countries are protected.“This will minimise the possibility of future disagreements and disputes over the long duration of the project lasting decades.”
Notwithstanding the termination of the project, Mr Ong said that Singapore will be willing to discuss any new proposals relating to the HSR from Malaysia in good faith. Such a discussion, however, would have to start from a clean slate, after Malaysia compensates Singapore in accordance with the parties former agreement, he said.The compensation would include costs already incurred by Singapore in fulfilling its obligations under the HSR bilateral agreement, such as the setting up of SG HSR, an infrastructure company that is a wholly-owned subsidiary of the Land Transport Authority.
Mr Ong said he is unable to reveal the exact amount of compensation that Malaysia will have to pay Singapore, due to confidentiality obligations under the HSR agreement, but he revealed that Singapore had so far spent more than S$270 million on the project.This sum includes abortive costs for various components, such as the consultancy services, design of infrastructure and manpower hired to deliver the HSR project, but it does not include land acquisition costs as the value of the land can be recovered, he said.
Read more at https://www.todayonline.com/singapore/failed-hsr-project-msia-wanted-remove-assetsco-which-was-needed-protect-both-countries