KTMB Land Issue: The Last Train into Tanjung Pagar

June 29, 2011

by Din Merican

In signing the Points of Agreement (POA) on Malayan Railway (KTM) Land with Singapore on June 27, 2011 Minister in the Prime Minister’s Department, Nor Mohamed Yakcop said, “It’s a very happy day. It’s a new beginning for us in cooperation in attracting investment. It’s excellent for both countries. We are confident this is a new beginning for good cooperation and plenty of investments. Certainly,  not only Iskandar will do well but the whole of Malaysia will do well because of confidence factor in attracting foreign investment.”

In reciprocation, Singapore Foreign Minister K. Shanmugam said: ”It really takes the relationship to a different level. It’s win-win….for both countries and promises much more. In that sense, in every sense, it’s historic moment.”

As a long time friend of Singapore who had the privilege of living and working there in late 1980s, I join Malaysians and Singaporeans in supporting and welcoming this enhancement in bilateral relations between our two countries on a mutually advantageous basis, one that could be continuously strengthened in the future.

But I am of the view that to sustain this positive momentum in bilateral relations, cooperative efforts and other confidence building measures cannot be undertaken in an opaque manner. There is, therefore, a need for our government to keep Malaysians informed on vital issues like the KTMB Land issue.

Murkiness, obfuscation and mystery have unfortunately overshadowed the so-called “win-win” deal in respect of a land swap deal in Singapore involving KTMB (Keretapi Tanah Melayu Bhd), which was agreed to between Prime Minister Datuk Seri Najib Razak and his Singapore counterpart, Lee Hsien Loong, in Kuala Lumpur May 24 and September 20, 2010.

Six rounds of talks have been held between Heads of Foreign Ministries of both countries, even if the main negotiators have been our Khazanah National Bhd and Temasik Holdings, the respective government’s investment arm.

To-date, no details on the definitive outcome of the deal have been made public by either government even after the conclusion of the sixth and final talks, which were held in Singapore on December 31 last year.

Instead, out of the blue, The STAR newspaper ran a story on June 9, 2011 under the caption “Party plans on track for last train ride to Tanjung Pagar”. And on June 14, 2011, The New Straits Times in a front page report said “Tickets snapped up for KTMB’s final Tanjung Pagar service”.Apparently, KTMB had recently taken some of our journalists on a tour/special trip down to Tanjung Pagar (picture above right).

Historical Significane of June 30, 2011

It would appear that KTMB as well as some in our media tend to treat the pending closure of the nearly 100-year old Tanjung Pagar Station and the historic building as something merely nostalgic. Seeking out and keeping our public informed regarding details on the outcome of the six rounds of official talks by the two countries or on related issues of the railways service or its history seems unimportant to them.

Singaporeans must have been in glee over KTMB’s idea of entertaining our  history-deficient journalists, who do not seem to know that our country could have taken for a ride by Singapore over tens of billions of KTMB real estate in Singapore without adequate compensation.

A rather perceptive member of the public, a certain Karim Mahsood, on June 13, 2011 wrote to The STAR newspaper, reminding readers that June 30, 2011, the date of the last train to Tanjung Pagar “… is not a joyous affair, but a heartbreaking episode in the history of KTMB in Singapore… “

Karim Mahsood attributed this development to “… a series of unfortunate steps…” that were taken by our own leaders, which began in 1990 with a lopsided agreement between Malaysia and Singapore called the Points of Agreement (POA), and culminating in the 2010 deal for KTMB to relocate its services from Tanjung Pagar to Woodlands on June 30, 2011.

The Najib-Lee Hsien Loong Deal

Under the Najib-Lee Hsien Loong deal, the Singapore Government would vest four tiny land parcels in Marina South and two parcels of land in Ophir-Rochor in MS Pte Ltd. (a joint-venture company set up by Khazanah National Bhd. and Temasik Holdings in a 60-40 % equity arrangement respectively, for the development of the said six parcels when KTMB  vacates the Tanjung Pagar Railway Station), in lieu of the three parcels of so-called POA land in Tanjung Pagar, Kranji and Woodlands and three pieces of land in Bukit Timah. The long and short of the deal is that KTMB’s Tanjung Pagar Station will be closed on or by July 1, 2011 and relocated to Woodlands temporarily.

And on June 26, 2011, there was yet another bolt out of the blue: that Nor Mohamed Yakoop (and not Foreign Minister Anifah Aman) and Singapore’s Minister of Foreign Affairs and Law, K. Shanmugam, would sign “the instrument containing details of the implementation of the POA on KTMB land in Singapore” on June 27. It was couched innocuously  that Tanjung Pagar would be closed down by or on July 1, 2011. Perhaps, both governments want this momentous event to pass off unnoticed.

Nor Mohamed and Shanmugam also confirmed that Malaysia and Singapore have agreed to open a “rapid transit system (RTS) link” between the two countries by 2018 and, secondly, that yet another joint-venture company had been established – in addition to MS Pte Ltd – known as Iskandar JV Co. , held 50-50 by Khazanah Bhd and Temasek Holdings to undertake two development projects in Iskandar Malaysia involving 87 hectares of land.

Despite the above, the public in both countries, particularly in Malaysia, remain uninformed especially as to how the Najib-Hsien Loong deal would contribute to mutually advantageous relationship between our two countries in the future and, specifically, how the deal would safeguard Malaysia’s “national interest”. Indeed, there are wider political implications that our Government leaders must face.

The KTMB Land saga(and other properties in Singapore) does raise several important points:

a) The move by KTMB to Woodlands will signal the beginning of the transfer to Singapore, not only the historic railway station building in Tanjung Pagar, but also some 175.7 hectares of KTMB land, in exchange for joint development of six parcels of land in Marina South and Ophir-Rocher whose total value is also not known to the public. ASIAWEEK magazine in its March 31, 1995 issue estimated the 32 hectares of prime property of Tanjung Pagar alone to be worth USD 2 billion, making KTMB “… the republic’s second-biggest land owner after the local government”.

b) When KTMB vacates Tanjung Pagar Railway Station to “tumpang”(squat) at Singapore CIQ building in Woodlands by July 1, 2011, it would actually mean that all KTM land in the Island nation, south of Woodlands, will revert to Singapore. This Malaysian real estate in Singapore – some 175.7 hectares in all – will be gone forever without adequate compensation to Malaysia. Again based on ASIAWEEK’s estimate in 1995 of the 32 hectares of Tanjung Pagar property, KTMB’s entire 175.7 hectares of real estate in the island Republic could today easily be worth between USD 0.25 to USD 0.5 trillion.

c) The Woodlands checkpoint is not a railway station in the normal sense but a Customs, Immigration and Quarantine (CIQ) checkpoint belonging to Singapore. It is indeed difficult to imagine how KTMB can effectively use the Woodlands checkpoint as its new terminal in Singapore.  It does look like KTMB will be compelled to retreat further north to Johar Bahru, sooner rather than later. When that happens, a glorious chapter in the history of KTMB operations to and from Singapore would be forced into an early closure.

d) The 1990 POA was Lee Kuan Yew’s strategic move to subtly uproot the KTMB Railway line which literally divides the Island State into two halves from North to South. Therefore, the move by KTMB from Tanjung Pagar to Woodlands is also the beginning of the fulfillment of Lee Kuan Yew’s dream since 1990.

e) The injection of the so-called “development charges” by the Prime Minister of Singapore at the eleventh hour into the negotiations in Kuala Lumpur  is seen as one made in bad faith.

As a matter of fact, Singapore’s insistence that Khazanah will have to pay certain “development charges” might mean that in reality Singapore would get KTMB’s entire 175.7 hectares in Singapore as well as Khazanah’s investment in joint development projects in Singapore  practically for free.

f) And, in the meantime, the dispute over the so-called “development charges” has still not been resolved. There is absolute silence over the status of the matter, which both countries agreed in Kuala Lumpur in 2010 to be brought up to the Permanent Court of Arbitration.

g) No less serious are real concerns here that not only will KTMB lose 175.7 hectares of its land and even Khazanah’s investments in Singapore but, more importantly, that Malaysia, as a whole, over the longer haul, would effectively lose control of large chucks of Johor and even land as far as Malacca to Singapore through the Iskandar- Malaysia ventures and other similar plans.

How some Singaporeans look at the Najib-Hsien Loong Deal? Many Singaporeans who are friends of Malaysia are puzzled why the Malaysian negotiators agreed to such a deal in the first place? They ask what possible quid pro quo benefits Malaysia could have. Surely, they say Malaysia does not need the money.

Is maintaining KTMB’s assets in Singapore a burden to Malaysia? If this is not the case, then Malaysia has the upper hand. So, what and why the rush and why the bending-backwards? Why so eager to close the deal? Worse still, friendly Singaporeans ask why “so cheap”?Many Singaporeans believe Malaysia is “incompetent” and, as a result, gets short-changed. That Malaysia is always ill-prepared and that it is not thorough enough. They attribute this to a number of factors:

i) partly due to interference by our politicians and that our civil servants have been marginalized;

ii) structurally, Malaysia does not have and fails to attract the brightest brains into the Civil Service, people with the long-term interest of the country at heart;

and iii) politicians and civil servants with too much personal, short-term interests to fight the kiasu, no-holds-barred, win-all, no tolak ansur (no give and take) Singapore’s Team. This, Singaporeans say, is at the root of the problem, one that is most unfortunate.

Why Nor Mohamad, not Anifah Aman

Singaporeans are also generally puzzled as to why Nor Mohamed Yakoop represented Malaysia at the recent signing ceremony in Singapore? They expected Foreign Minister Anifah Aman to have accompanied Nor Mohamed and do the honours for Malaysia.

But as proud Singaporeans, they say the deal is okay – after all it is Malaysia’s loss and Singapore’s gain. As Singaporeans they feel proud of their Team, who got the best deal for Singapore. As for Lee Kuan Yew, getting such a deal from Malaysia makes the outcome even sweeter.

Need for Transparency

All told, transparency is crucial in ensuring positive, forward movement in bilateral relations as well as in winning the hearts and minds of the public. One can try to mask underlining problems of any deal by words and promises of future infrastructural development and consequent economic growth. But good intentions can produce bad results.

Foreign policy should be concerned with a country’s “national interest”. Diplomacy as an instrument of Foreign Policy is the art of negotiation, of getting deals that serve the national interest.  In other words, “national interest” should dictate Foreign Policy.

Unless “national interest “is firmly embedded in the minds of government ministers, it is not likely that the making of foreign policy will return to its proper, central place at the Ministry of Foreign Affairs (in our case, Wisma Putra). In this regard, Singaporean diplomats and their political masters are stark realists, always serving their country’s national interest.

In conclusion, there is a need for proper national debate in Malaysia on the Najib- Hsien Loong deal– in the media, in intellectual and business circles and, indeed, ultimately in Parliament. Perhaps, a White Paper should be presented to our legislators in Parliament.