KUALA LUMPUR: Malaysia is still committed to the Johor Bahru-Singapore Rapid Transit System (RTS) despite its decision to cancel the KL-Singapore High Speed Rail (HSR) project, said new Transport Minister Anthony Loke on Wednesday (May 30).
In an interview with reporters, Loke said the RTS project will proceed, although the government will look at lowering the cost of the project given the country's debt.
"The RTS will proceed. Of course we have to restudy the project in terms of cost and so on. But as a principled decision, the RTS is still on the table.
"I was made to understand that the cost of the project is RM4 billion (US$1 billion) for the Malaysian government but of course we are looking at how to reduce cost ... we have just made the decision, we have to initiate negotiations and discussions with our counterparts in Singapore,” he said.
On the KL-Singapore HSR, Loke said the cost of the project still outweighs the benefits for now, although Malaysia may revisit it after the country tackles its debt.
"As the Prime Minister has said this morning, the cancellation of the HSR is subject to negotiation and discussions with the Singapore government. But of course, why we cancelled the project is because of affordability. The priority of the government is to pay our debts and the ability to repay our debts, that is our main priority, that's why some of these projects must be shelved.
“But of course, it's subject to review. I mean if we are in a better position later on. But as of now, the decision has been made to cancel the project. But a lot of discussions and negotiations have to be made with the Singapore government,” he added.
When asked if Malaysia really believes that it will not benefit from the project, Loke said: "I think the questions of benefits and so on is polemic. Of course there are different interpretations, different opinions and so on. Of course any infrastructure project, you can't say there's no benefit at all but I think the question now is affordability. And the priority of the new government.
“The priority of the new government is to clean up the mess of the previous government. And the number one priority is to make sure our finances are back to healthy … back to a healthy stage and our ability to pay government loans and debts is our number one priority. We do not want to add on to debts and the pressure on the government,” he added.
During a press conference earlier on Wednesday, Prime Minister Dr Mahathir Mohamad reiterated that such large projects would cost too much money as Malaysia's borrowings were already high.
"If the country is to avoid bankruptcy, we must learn how to manage our big debts and one of the ways is to do away with projects that are not beneficial to us," he explained.
Dr Mahathir said the Cabinet decided to cancel the HSR project, considering its high financial implications, subject to discussion with the Singapore government.
Asked if the government would reconsider its decision if Singapore could prove that the project would benefit Malaysia, he said: "We will listen to them. They are our good partner."
The Prime Minister said a separate briefing session will be held on Thursday to discuss measures the Ministry of Finance will take to control costs for the country's administration.