Sand ban hurts both sides: PM Lee

The Sunday Times, March 18, 2007
By Zakir Hussain



INDONESIA'S ban on sand exports is unfortunate and a lost opportunity for economic cooperation, said Prime Minister Lee Hsien Loong.

He believes the ban hurts both sides but Singapore has to accept the decision and look for ways to overcome the problem.

PM Lee's remarks to a group of Japanese journalists were his first public comment on the ban since it was imposed last month.

Since then, Singapore has been buying sand from others while it explores reducing the dependency on sand in construction.

The interview with the Japanese journalists was done ahead of his visit to Japan which starts today.

Said the PM: 'There is potential to go for more efficient processes, steel and drywalls. These are things which we are embarking on and which will reduce our construction costs.

'In Japan you don't use sand, you use steel and if you can do it, there's no reason why these companies cannot do it in Singapore.'

Indonesia, with about 220 million people, is Singapore's largest neighbour. Mr Lee noted that the two countries have many links, including in security and economic cooperation.

Singapore wants a 'constructive relationship' with Indonesia, he said, replying to a question on the sand ban. 'It's unfortunate that this problem has come up. We don't fully understand why.

'The official explanations are that it's because of concern over the environment and that it has nothing to do with other issues which we are negotiating, like the extradition treaty and the defence cooperation agreement or the ongoing talks on boundary demarcation.

'So we accept these explanations as they're given to us and we hope that over time, the matter will stabilise and we will be able to resume our cooperation.'

When Indonesia stopped sand exports on Feb 6, officials said it was to protect the country's environment and maritime borders.

Later, some Indonesian officials said it was to pressure Singapore into quickly concluding an extradition treaty and resolving issues related to border demarcations and a defence pact.

Despite the ban, Singapore sees a lot of potential for cooperation between Asean nations, said Mr Lee.

He cited Singapore's pact with Indonesia to improve investment conditions in special economic zones in Batam, Bintan and Karimun, and promote them overseas.

When he met Prime Minister Shinzo Abe last year, Mr Lee said he expressed the hope that Tokyo would encourage Japanese companies to invest in these zones.

'We really want a constructive relationship and we do not see any advantage in raising the temperature.'

Asked how Singapore was coping with the ban, Mr Lee said the sand stockpile 'will last for a considerable time' and the cost increase was 'quite bearable'.

The Government will bear 75 per cent of the rise in sand costs for its projects.

But, he added: 'In the private sector, we cannot control how they divide the cost.'