Singapore water deal: Mahathir seeks over tenfold price hike

The current water agreement, which expires in 2061, sees Singapore drawing up to 250 million gallons a day of raw water from the Johor River.
The current water agreement, which expires in 2061, sees Singapore drawing up to 250 million gallons a day of raw water from the Johor River.ST PHOTO: DESMOND WEE

PUTRAJAYA • Malaysia's Prime Minister Mahathir Mohamad has said he wants to increase the price of raw water supply to Singapore by more than 10 times to reflect the higher cost of living.

The current water agreement, which expires in 2061, sees Singapore drawing up to 250 million gallons a day (mgd) of raw water from the Johor River, and Johor entitled to 5 mgd of treated water from Singapore.

Singapore pays 3 sen (1 Singapore cent) per 1,000 gallons of raw water and sells treated water back to Johor at 50 sen per 1,000 gallons. Singapore has said this price is heavily subsidised and below the cost of treating the water.

Malaysia chose not to review the price when allowed to in 1987, but talks took place when Tun Dr Mahathir, who was then prime minister, raised the issue in 1998. The talks did not result in a new pact.

In an interview with the Associated Press published yesterday, Dr Mahathir said Johor sells raw water to another Malaysian state Melaka at 30 sen per 1,000 gallons, which he described as "charitable".

"To a foreign country, we need to get more than that," he said.

Since his comeback as the world's oldest prime minister after leading the Pakatan Harapan (PH) coalition to victory in the May general election, Dr Mahathir has in recent interviews criticised the 1962 water deal as "too costly" and "ridiculous", and said Malaysia would approach Singapore to renegotiate the terms of the deal.

  • 3 sen

    What Singapore pays for 1,000 gallons of raw water from Johor under the current deal.

    50 sen

    What Johor pays for 1,000 gallons of treated water from Singapore

Dr Mahathir had served a previous stint as prime minister from 1981 to 2003.

Singapore's Ministry of Foreign Affairs (MFA) said last month that Singapore has been clear and consistent in its position that Malaysia lost its right to review the price of water under the 1962 Water Agreement in 1987.

The statement came as Malaysia's national news agency Bernama cited Malaysian Foreign Minister Saifuddin Abdullah as saying in an interview that "the agreement says the content of the agreement can be reviewed after 25 years".

 
 
 
 

MFA said Singapore's position was set out in Foreign Minister Vivian Balakrishnan's remarks in Parliament on July 9 where he said Dr Mahathir had noted in 2002 that Malaysia did not ask for a review when the water pact was due as it knew any revision would also affect the price of treated water sold by Singapore to Malaysia.

The water issue has been brought up on several occasions in Malaysia since the PH government took over.

Last month, Johor Menteri Besar Osman Sapian said the state hopes it can raise the price of the raw water it sells to Singapore after discussions with its southern neighbour. In the same month, Datuk Saifuddin said his country will honour the water agreement with Singapore while seeking to restart negotiations on pricing.

A version of this article appeared in the print edition of The Straits Times on August 14, 2018, with the headline 'S'pore water deal: Mahathir seeks over tenfold price hike'. Print Edition | Subscribe