Malaysia agrees to give up railway land in Singapore

Malaysia and Singapore’s prime ministers announced plans yesterday to jointly redevelop prime real estate in the city-state in a bid to solve a territorial problem dating from their separation.
Visiting Malaysian Prime Minister Najib Razak and his Singaporean counterpart Lee Hsien Loong said Malaysia had agreed to relocate a railway station from downtown Singapore to the border with Malaysia by 2011.
The station could eventually be relocated to Malaysian territory after the establishment of a rapid transit system, according to the statement.
“Both prime ministers reaffirmed their commitment towards further strengthening bilateral relations and mutual collaboration in various areas,” the two said in a joint statement.
Singapore was ejected from the Malaysian federation in 1965, but Malaysia still occupies railway land in Singapore leading to Malaysian territory, including the station on the fringes of Singapore’s banking district.
The issue was just one of the disputes that have periodically strained relations since Singapore and Malaysia separated — an episode that still rankles on both sides.
Under the latest plan, Malaysia’s state railway — KTM — will move its Singapore terminal to Woodlands, an industrial zone located just across a narrow strait from southern Malaysia’s Johore state, by July 1, 2011. A company to be known as M-S Pte Ltd will be established to take ownership of the vacated area, with 60% of the equity held by Malaysian investment agency Khazanah Nasional Berhad and 40% by Singapore’s Temasek Holdings.
Both sides will conduct valuations of the land and Lee will visit Kuala Lumpur within a month with a proposal for a land swap, the statement said.
The railway land could be swapped for real estate in two of Singapore’s most expensive districts, including the site of the multibillion-dollar Marina Bay Sands casino complex, which opened in April.
Song Seng Wun, a regional economist with CIMB-GK Research in Singapore, said the railway land’s worth “could be in the billions” of dollars.
In their statement, the prime ministers said the two countries would develop a rapid transit system linking Singapore and Johor Bahru city, to be integrated with public transport services on both sides. “It is targeted that the proposed rapid transit system link will be operational by 2018,” the statement said, adding that once the system is up, Malaysia “may consider to relocate” the KTM train station to Johore.
Singapore also agreed to invest in Johore’s Iskandar Malaysia township project, a residential, industrial and tourism zone designed to boost foreign investment in the state.