Newly installed Malaysian Prime Minister Mahathir Mohamad (left) looks on as Sultan Muhammad V, the 15th king of Malaysia, delivers an address during the opening ceremony of parliament in Kuala Lumpur on July 17. (Photo by Mohd Rasfan/AFP)
Since new Malaysian Prime Minister Mahathir Mohamad came to power in May, fresh tensions have appeared between Singapore and Malaysia. In fact, "Dr. M" has questioned several agreements between the two countries, especially a high-speed rail (HSR) project to build a 350-km line running from Singapore to Kuala Lumpur.
Yet the destinies of the two countries remain closely linked. Despite their separation in 1965, they share a common history and the Causeway, the bridge linking the two nations, is always congested.
Meanwhile, Malaysia's outgoing prime minister Najib Razak runs the risk of imprisonment; Anwar Ibrahim, who is widely tipped to succeed Mahathir, has just left prison; and Mahathir is responsible for both incarcerations.
Seen from Singapore, the political situation in Malaysia could give rise to a wry smile, but since going their separate ways 53 years ago the destinies of the two neighbouring states have remained closely linked.
Singaporeans are among the biggest investors in Malaysia and many have family there — and vice versa. It is thus with great interest that Singapore is observing the impressive return of Mahathir to the top post.
The return of 'Dr. M'
Mahathir led an anti-government coalition to a surprise victory on May 9 when it won 113 of 222 seats in parliament to claim a simply majority.
That also put an end to the 61-year reign of the Barisan Nasional (National Front) Party led by Najib, which only managed to hold on to 79 seats, and was surely a humiliation for him after nine years in power.
Mahathir, who at 93 became the world's oldest head of state, is well known to Singaporeans. Before joining the opposition, he was an emblematic figure of the ruling party.
His 22-year reign as prime minister was also one of the most trying periods in the history of the two countries. At the time he faced Lee Kuan Yew, the so-called "father" of Singapore.
Relations between the two charismatic politicians were often strained and many feared Lee Hsien Loong — the son and successor of Lee Kuan Yew, who died in 2015 — would not be up to the task.
However the Singaporean leader lost no time in meeting Mahathir. He went to Putrajaya, a city just south of the capital, on May 19 but said at the end of their visit that they did not discuss substantial bilateral issues.
"It was really a courtesy call for me to send him my greetings and good wishes," he said. "I hope we'll be able to work together."
During his visit, the Singaporean prime minister also met Anwar, who had only been released from prison three days earlier.
Anwar is scheduled to take over from Mahathir as prime minister in two years' time, under an agreement between the two men. Some 20 years ago this would have been inconceivable as they viewed each other as political enemies, making their alliance against Najib more than a little surprising. However, given they both wanted to get rid of Najib, they needed to work together.
Anwar was serving a five-year prison sentence until Mahathir secured his pardon and subsequent release, and he was freed in the middle of May.
Anwar, then deputy prime minister, had been dismissed from the government and convicted of abuse of power and sodomy, charges he says were politically motivated.
Shortly after his election victory, Mahathir said his government planned to drop the HSR agreement. This accord, signed with Singapore in December 2016 by the Najib administration, would cut the travel time between the two cities from 4-5 hours by car to 90 minutes by train.
So far, Singapore has not received any official confirmation that the project, due for completion by 2026, will be scrapped. Moreover, the city-state has already spent over 250 million Singapore dollars (US$183.8 million) on it.
"Should Malaysia cause the HSR project to be terminated, we would deal with the question of compensation from Malaysia for the costs incurred by Singapore in accordance with the bilateral agreement and international law," Singapore's Transport Minister Khaw Boon Wan said.
On June 6, Mahathir told a press conference the new government would also re-examine a project announced by the preceding administration to establish a commercial link between the two country's stock markets.
The link would offer investors from both sides easier access to the two markets, which have a combined capitalization of more than 1.588 billion Singapore dollars with 1,600 listed companies.
The Singapore Monetary Authority has asked Malaysia to clarify its position on the plan to link the two stock markets.
Another agreement pertaining to water has always proven a thorny issue. Water imported from the Malaysian state of Johor is crucial for Singapore even if the republic has diversified its water supply by desalinating seawater, storing rainwater and treating wastewater.
Last month, Mahathir said in an interview that he would like to review the 1962 water agreement with Singapore, which he criticized as being "too costly" and "ridiculous."
Following his comments, Singapore said it was a fundamental accord that was guaranteed by the two governments in their 1965 Separation Agreement registered with the United Nations.
Any violation would call into question the separation agreement, which, it stressed, is the foundation of the very existence of Singapore as an independent sovereign state.
By casting doubt on the HSR, the commercial link between the stock exchanges and the water agreement, Mahathir seems to be modifying the very tenor of relations between the two states.
Are these declarations warning signs of trouble between them? Not necessarily.
Fixing the mess
"The priority of the government is to clean up the mess of the previous government," the new Malaysian Transport Minister, Anthony Loke, said recently.
"The No. 1 priority is to make sure our finances return to a healthy [condition]," he said. "Recovering our ability to pay government loans and debts is [the key]."
The ruling Pakatan Harapan coalition was elected on a program that promised change, so its biggest challenge is to restore economic dynamism and get institutions functioning again.
Mahathir thus needs to show his will to rein in the spending his predecessor indulged in, and this is something that is reflected in his foreign-policy addresses.
But during a recent trip to Japan he suggested the HSR project would likely be postponed and probably not, ultimately, cancelled after all.
Where his statements on the water agreement are concerned, some observers feel he is trying to pressure Singapore to lower the amount of compensation Malaysia would be required to pay if it canceled the HSR contract.
Meanwhile, Malaysia's decision to abandon its claim to the island of Pedra Branca at an international tribunal in The Hague also seems like a timely goodwill gesture. The island has long been the subject of a territorial dispute between the two countries.
The status quo is therefore quite different from when Mahathir last left office. He must now negotiate with four party leaders that make up a diverse coalition, which limits his room to maneuver.
Additionally, even if he remains in excellent health and full of energy, he is 93 and he will soon have to hand over power.
Meanwhile, over in Singapore
Singapore enjoyed very good relations with Najib. The 1MDB scandal, named after a sovereign fund from which close to four billion euros in public money was embezzled, including 640 million deposited into Najib's personal account, played a crucial role in his defeat.
The former prime minister has now been arrested and could soon find himself behind bars. This concerns Singapore as the government fears instability and uncertainty, and is thus worried about the latest developments in Malaysia, a concern heightened by the fact that it is itself in a transitional period.
In fact, many question marks remain in the post-Lee Kuan Yew era. Lee Hsien Loong needs to hand over power soon and his successor has not yet been identified, although there seem to be three frontrunners.
Some observers, such as former prime minister Goh Chok Tong, have expressed concern about how long this process will take.
Mahathir's surprise victory has encouraged some in Singapore to hope for a similar result when its poll looms, sometime before 2021, and "Dr. M" himself told the Financial Times he expected it would have an impact.
"I think the people of Singapore, like the people of Malaysia, must be tired of having the same government, the same party since independence," he said.
However, the People's Action Party (PAP), which has controlled power in Singapore since 1959, is a far different beast from the Barisan Nasional. For a start, it has done a better job and has done so more consistently, as the Lowy Institute, a Sydney-based think tank, so adroitly points out.
In another twist, Lee Hsien Loong's siblings have accused him of nepotism and misusing power but that tends to pale in comparison to the scandalous corruption Najib has been accused of.
"If the Pakatan Harapan governs with success and manages to push through difficult reforms, it is hard to imagine that this would not help to energize Singapore's opposition," the Lowy Institute quoted Thomas Pepinsky, a political scientist at New York's Cornell University, as saying.
"But if the Pakatan Harapan lurches from crisis to crisis, or there is a deterioration in financial conditions or social stability, the effect will probably be to strengthen PAP's hand further," he argued.
Despite the potential tensions, it is important to stress that the ties between Singapore and Malaysia go back a long way and remain on solid ground.
Friction is par for the course between neighbors but it is in each side's interest to strengthen bilateral ties.
"Many of us [in Singapore] have talked about this in private and social circles," said Braema Mathi, the former head of Maruah, a Singapore-based human rights organization.
"We wish [Malaysians] the very best to advance on the road to democracy, and hopefully we, too, can move towards that path more and more," the Lowy Institute quoted her as saying in a report.
"Bilateral relations need to remain a focus as Malaysia keeps pursuing reform."