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Malaysia cool on S'pore ties despite denial of freeze

| Source: AFP

Malaysia cool on S'pore ties despite denial of freeze

KUALA LUMPUR (Agencies): Malaysian leaders have stressed that
ties with Singapore will not return to normal in a hurry, while
scotching reports of a sweeping freeze on new bilateral dealings
after their worst row in years.

The government moved to prevent the bitter row from heating up
further with a denial Thursday that it was putting relations on
ice, but ministers and political leaders made it clear that ties
will take time to mend.

Acting Foreign Minister Abang Abu Bakar Abang Mustapha denied
reports in government-owned and pro-government news outlets that
Malaysia wants to freeze official trade and political relations.

"I need to state that what has been reported by the media ...
is not that accurate," Abang Abu Bakar said.

All Malaysian newspapers and the country's semi-official news
agency Bernama reported on Wednesday that the government had
decided to stop awarding business contracts to Singapore
companies.

Noting the clarifications, a Singapore Foreign Ministry
statement said the government is committed to maintaining close
bilateral relations. It quoted Prime Minister Goh Chok Tong as
saying Singapore would let Malaysia "set the pace and level of
bilateral cooperation."

Singapore Senior Minister Lee Kuan Yew's two apologies and
offer to retract derogatory remarks about the southern Malaysian
state of Johor, which sparked off the diplomatic storm, had not
assuaged Malaysian anger.

Activities such as joint cultural performances and friendly
sports matches between government agencies may be called off but
government-to-government contacts and commercial relations remain
undisturbed.

Works Minister S. Samy Vellu said an agreement on sports and
culture that was due to be signed soon could be postponed, but
work on a second link bridge connecting Malaysia and Singapore is
to proceed as scheduled.

The vice president of the ruling United Malays National
Organization (UMNO), Najib Tun Razak, said it would take "some
time to forgive and forget," despite Lee's apologies and
Singapore Prime Minister Goh Chok Tong's call for the two
countries to put the row behind and "move on."

Reports that the cabinet, at its meeting Wednesday, had
decided to freeze all new dealings with Singapore shook financial
markets in the island.

Both the Malaysian ringgit and the Singapore dollar dipped
against the United States dollar.

The subsequent denial caused confusion on the diplomatic front
about what exactly was decided by the cabinet, which met in the
absence of Mahathir and Foreign Minister Abdullah Badawi, who are
in Tokyo.

A senior minister told AFP the cabinet had basically decided
to keep relations with Singapore at a "low key" and not be "too
enthusiastic" in cooperating with the island republic.

"Basically, we are still unhappy over the incident and this
will go carry on for some time. Let the issue be kept alive,"
said the minister, who declined to be named.

"You spit at me, curse at me and now after apologizing, you
want us to move on. How can we? Singapore must show its sincerity
in its relationship with Malaysia," he said.

Both countries, however, have much at stake.

Malaysia is Singapore's second largest trading partner, with
bilateral trade estimated at US$43 billion last year, and its top
investment destination. Much of Singapore's food and most of its
water comes from Malaysia. Some 200,000 Malaysians cross the
causeway daily to work in Singapore.

Speaking in Tokyo, Mahathir said Thursday relations would
eventually return to normal when Malaysians overcome their
feeling of hurt.

The Singapore foreign ministry extended a conciliatory hand,
saying the republic would let "Malaysia set the pace and level of
bilateral cooperation."

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