KUALA LUMPUR: Malaysia must pay compensation to Singapore over the termination of the Kuala Lumpur-Singapore High Speed Rail (HSR) project.
The final extension of the agreement expired at midnight on Dec 31, 2020.
In a statement, Singapore's Transport Ministry said the compensation is for the costs incurred by the republic in fulfilling its obligations under the HSR Bilateral Agreement (BA) in accordance with the Parties' agreement.
"Singapore and Malaysia had signed the Kuala Lumpur-Singapore HSR BA in 2016. The construction of the HSR Project was subsequently suspended, from Sept 2018 to Dec 31 at Malaysia's request, with the understanding that the extension of the suspension period until Dec 31, 2020 would be the final extension.
"Prime Minister of Singapore Lee Hsien Loong and Prime Minister of Malaysia Tan Sri Muhyiddin Yassin met via video-conference on Dec 2 to review the status of the HSR project, including the changes proposed by Malaysia to the HSR project.
"Malaysia has since allowed the HSR BA to be terminated, and has to compensate Singapore for costs already incurred by Singapore in fulfilling its obligations under the HSR BA in accordance with the Parties' agreement," read the statement.
The city state's Transport Ministry also confirmed that "deep and multi-faceted" good relations and close cooperation between Malaysia and Singapore will remain for the mutual benefit of the people in both countries.
Earlier today, in a joint statement, Muhyiddin and Lee confirmed that the countries were unable to reach an agreement over the changes proposed by Malaysia to the HSR project before the final extension's deadline of Dec 31, 2020.
The two leaders, however, expressed commitment to fulfil their respective obligations and proceed with the necessary actions resulting from the termination of the agreement.