Tuesday, July 7, 2009


As posted by Dr. Mahathir Mohamad at Che Det on July 6, 2009 5:23 PM

1. I am gratified that so many Singaporeans know minute details regarding the price of water (raw and treated) and the negotiations that took place.

2. True, I did not negotiate successfully the increase of the 3 sen per 1000 gallons of raw water. You know why? If we demand an increase to 6 sen (100%), Singapore would increase the treated water price to RM1.00 (100%). Of course if we increase to RM6.00 Singapore would demand an increase to 50 x 2000% = RM100.00.

3. Yes, Malaysia profited by buying treated water at 50 sen. Malaysia's entitlement was only 12% of the raw water it sold to Singapore. The cost of treatment is not RM2.40 as alleged. It was only RM1.20. However, since the Singapore dollar has appreciated against the Malaysian Ringgit from being at par to RM2.40, the same cost to Singapore would now be about 2.4 times the original RM1.20.

4. By the same token, when Singapore pays 3 sen to Malaysians, in Singapore dollars it is only 0.42 sen (less than 1 sen for 1000 gallons).

5. At the original cost agreed upon Malaysia benefited by 70 sen per 1000 gallons of treated water but only on 12% of the raw water sold.

6. Assuming that Malaysia sells 100 million gallons to Singapore, it would pay RM3,000. Malaysia's purchase of 12,000,000 gallons would be RM6,000. Despite the discount, Malaysia would have to pay Singapore RM6,000 while Singapore would pay Malaysia RM3,000. It looks like Singapore would pay Malaysia with the money it earns from selling water to Malaysia and still have money to spare.

7. The negotiations failed because Singapore wanted more water beyond 2060. We could not agree to commit the future generations of Malaysians to something that could be to their disadvantage.

8. The price of treated water to the citizens of Singapore is very high compared to the 0.42 of one sen paid by Singapore for 1000 gallons plus the cost of treatment.

9. It is clear that for every day the water agreement remains in place, the Singapore Government stands to gain a huge sum of money from selling water to the people of Singapore.

10. By 2011 the first agreement would lapse. But the second agreement would lapse only in 2060. Singapore can enjoy 0.42 of one cent per 1000 gallons for another 51 years.

11. Since the present Malaysian Government has generously decided to stop discussions with Singapore on all outstanding issues, Singapore would continue to benefit from all the outstanding issues with Malaysia. Yet Malaysia willingly gave up its naval base at Woodlands without asking for any compensation for the facilities owned by Malaysia there.

12. Lee Kuan Yew is right. By Malaysian Government's consent Malaysia is Singapore's hinterland and subject to Singapore Government's largesse. Singaporeans need not worry. You will continue to pay 0.42% of 1 sen for 1000 gallons of raw water until 2060. It is Malaysia's gift to Singapore.