PETALING JAYA: Averting a RM60bil guarantee was among changes sought by Malaysia before the Kuala Lumpur-Singapore high speed rail (HSR) project was discontinued, says Datuk Seri Mustapa Mohamed (pic).
He said proposed changes put forth by Malaysia included a new and neater project structure based on HSR models in Europe, United Kingdom, Japan and South Korea.
“The proposed new structure would also allow the government to avoid giving a RM60bil guarantee over a 30-year period.
“Apart from this, it would have also provided us with more flexibility in financing the project, ” he said.
Mustapa also said Malaysia had proposed changes to the alignment and station design which would have further reduced the project cost by 30%.
He said several intensive discussions at the technical and ministerial levels were held over the past six months, with the prime ministers of both countries holding a video conference on Dec 2,2020.
“Unfortunately, we were unable to reach an agreement.
“As an individual who had been directly involved in the two-way discussions over the last six months, I wish to stress that we did what was best to safeguard the nation’s interest, ” the Minister in the Prime Minister’s Department said in a Facebook post yesterday.
He said another factor which was considered was the possibility of starting the project two years ahead of time.
“This would have assisted in speeding up Malaysia’s economic recovery post-Covid-19, particularly the construction industry, ” he said.
Despite the failure to reach a consensus on the proposed changes, Mustapa noted that discussions were held in an amicable and constructive manner with both countries looking at strengthening close ties.
He explained that the bilateral agreement with Singapore to develop the HSR project was signed in 2016 but the project was put on hold by the previous administration in May 2018 for a review.
With the emergence of Covid-19, Mustapa said, the current government was forced to find ways to reduce the cost of several mega projects while ensuring economic recovery.
“Original terms that were signed under bilateral agreements in 2016 were no longer viable for Malaysia, ” he said, adding that Singapore agreed in May last year to allow Malaysia to defer the start of the project to the end of 2020.
On the issue of compensation to Singapore, Mustapa said he could not divulge details as the exact sum had yet to be determined.
“I wish to stress that compensation is not punitive in nature but is for repayment of specific project costs which were expanded by Singapore.
“We are waiting for the cost details from Singapore and once received, it will be thoroughly looked into before being verified, ” he said.
Although bound by confidentiality under the bilateral agreement, Mustapa said he would discuss with Singapore to allow information on compensation to be shared once it is finalised.