RM100m annual payment from Penang to Kedah 'difficult to achieve'

ALOR SETAR: The Kedah government's demand for the annual 'lease payment' for Penang island and Seberang Perai to be increased to RM100 million is difficult to fulfil as the honorarium amount was just revised in 2018.

Universiti Utara Malaysia Politics and International Relations senior lecturer Assoc Prof Dr Mohd Azizuddin Mohd Sani said there are similarities between the demands made by the Philippines on its claim on Sabah as well as calls for Singapore to be returned to Malaysia.

He pointed out that there is an existing treaty that should be honoured between the parties that signed the agreement until the end of the decided period, unless one of the parties had breached the treaty during the tenure.

"In the Kedah and Penang issue, the earlier agreement stated that the annual payment is 10,000 Spanish pesos. It was then changed to RM10,000 before the federal government agreed to review the annual honorarium to RM10 million to Kedah beginning 2018.

"The honorarium payment has been made ever since the agreement was signed. With it being continued by the federal government, this means the agreement is still valid and the payment is still being made to Kedah, although the amount is deemed unreasonable.

"Besides, there is no act that breached the agreement, similar to Malaysia still paying lease payment to the Philippines and Singapore still paying to Johor," he said when contacted.

Yesterday, Kedah Menteri Besar Muhammad Sanusi Md Nor said teh state government has made a request to the federal government to revise the annual honorarium payment for Penang to RM100 million.

Sanusi had said the demand was reasonable given the current market value of land on Penang island and in Seberang Perai.

Mohd Azizuddin said both sides involved in any agreement should mutually agree to the terms, including the amount of payment.

"As such, the demand appears difficult to fulfil since it requires both sides to agree – in this case Kedah and the federal government should negotiate and reach an agreement to revise the amount, as Penang will definitely refuse to pay.

"Even if the both sides agree, Penang will ask for the federal government to pay the honorarium to Kedah but still it is subjected to mutual agreement among the parties involved.

"Other than that, there is no evidence to prove that the federal government or Penang had failed to pay the honorarium to Kedah, hence all parties involved should honour the existing agreement," he said.

Penang Chief Minister Chow Kon Yeow had yesterday dismissed Sanusi's demand and stressed that the federal government also need not entertain Kedah's demands, which was over and above the existing agreement.

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