Malaysian Prime Minister Abdullah Ahmad Badawi will meet his Singapore counterpart Lee Hsien Loong this month to boost ties and tackle unsettled issues, reports said today.

The leaders will hold an informal one-day retreat on May 15 in Langkawi, the New Straits Times reported.

Foreign Minister Syed Hamid Albar said bilateral ties were "at their best" but noted outstanding matters that have dragged on for years.

"We must find new approaches to settle these issues in a cordial atmosphere, though they are not the basis for the meeting," Syed Hamid was quoted as saying in the newspaper.

"It is a chance for both leaders to meet and talk without the pressures of an agenda," he said.

Relations have often been stormy since Singapore was ejected from the Malaysian federation in 1965 over ethnic issues but they have undergone a marked improvement in recent years, especially in economic cooperation.

Territorial claims

Among the outstanding issues are the price of water supplied to Singapore, the future of Malaysian-owned railway land in Singapore and rival territorial claims to a rocky islet off Malaysia's southern Johor state.

Syed Hamid said the claims on the small island are expected to be heard by the International Court of Justice in The Hague in November, and that the countries will abide by the court's decision.

"We hope the issue can be settled soon. Both countries will accept the ICJ's verdict on the dispute," he was quoted as saying by the state Bernama news agency.

Singapore's delegation is expected to include the country's foreign, transport and defence ministers, Syed Hamid said.