Singaporean Visit Eases Tensions With Malaysia  
International Herald Tribune
November 6, 1998
Thomas Fuller

Responding to an overture from Malaysia, Prime Minister Goh Chok Tong of Singapore made a hastily arranged visit here Thursday, meeting with Prime Minister Mahathir bin Mohamad in talks that centered on financial assistance for Kuala Lumpur.

The visit followed months of acrimony between the two neighbors over a range of issues, including supplying water to Singapore and the location of an immigration checkpoint.

"We will need to raise some funds in Singapore, and Singapore has promised to negotiate on how best it can help in that area," Mr. Mahathir said after a 90-minute meeting with Mr. Goh.

Neither Mr. Mahathir nor Mr. Goh gave details on the agreements discussed but hinted the talks were preliminary.

"We will first have to ascertain what is the requirement of Malaysia," Mr. Goh said. "Dr. Mahathir has told me what Malaysia's requirement will be. We believe we can meet those requirements. We haven't discussed the details."

Money matters have remained central to disputes between Kuala Lumpur and Singapore in recent months. Malaysian officials have hinted that Singapore has not been helpful enough to its northern neighbor as the economic crisis in the region has unfolded.

Both countries are facing recessions, but Malaysia has been harder hit than Singapore in the crisis.

The meeting Thursday came as a surprise because Mr. Goh is scheduled to visit Malaysia 10 days later during the Asia-Pacific Economic Cooperation forum.

Malaysia's apparent rapprochement with Singapore comes at a time when Kuala Lumpur is being criticized by leaders from around the region for its treatment of Anwar Ibrahim, the former deputy prime minister whose trial on charges of sodomy and corruption is under way.

Malaysia needs billions of dollars to recapitalize its banking system and help finance the government's swelling budget deficit. But the country has found it difficult to raise funds abroad since it introduced capital controls two months ago. In a move that wounded the Singaporean financial industry, Malaysia banned trading of its currency and stock market shares in Singapore.

On Thursday, Mr. Goh had soothing words for Malaysians. "What is most important is to narrow the gap of differences and work to maximize common area decisions," he said. "And where we could agree, we will agree and where we disagree on certain things, we agree to come back tomorrow."

Relations between the two countries, which were part of a federation until they split in 1965, are rocky at the best of times. But the recent disputes, amplified by the economic crisis, brought relations to the lowest point in years.

At a rally in August, Mr. Mahathir said Singapore should not take Malaysia for granted.

The crowd responded with the words, "Cut! Cut! Cut!" a reference to the water pipeline that flows to Singapore.

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