Malaysia's government has summoned Singapore's high commissioner for talks, saying it was "extremely concerned" by reports the city-state helps Western intelligence agencies spy on the region.
Media reports citing documents leaked by former US National Security Agency (NSA) contractor Edward Snowden put Singapore - a key US ally - at the centre of a spy network that reportedly taps undersea cables.
Citing documents leaked by Mr Snowden, Australia's Sydney Morning Herald said Singapore military intelligence helped US, British and Australian spy agencies harvest data passing through a major undersea cable called SEA-ME-WE 3, which is part-owned by Singapore Telecommunications (SingTel).
The cable connects more than 30 countries, including China, Indonesia, Malaysia, Saudi Arabia, Vietnam, Britain and France. The newspaper said Malaysia and Indonesia have been key targets for Australian and Singapore intelligence collaboration since the 1970s.
SingTel declined to comment, while Singapore's defence ministry did not respond to queries, and its foreign affairs ministry did not immediately provide a comment. If those allegations are eventually proven, it is certainly a serious matter that the Government of Malaysia strongly rejects and abhors," Malaysian Foreign Minister Anifah Aman said.
"It cannot be overemphasised that spying against a good friend and neighbour is unacceptable and goes against the true spirit of, and commitment to, good neighbourly relations." Last week, Indonesia downgraded diplomatic ties with Australia,a following media reports that Canberra spied on President Susilo Bambang Yudhoyono and his wife. However, on Tuesday Mr Yudhoyono struck a conciliatory tone after receiving a letter from Mr Abbott.
The letter contained a "commitment from the Australian PM that Australia will not do anything in the future that will disadvantage or disturb Indonesia", the President said. But even as tensions calmed with Canberra, they threatened to escalate elsewhere, with Mr Yudhoyono saying his government would summon the South Korean and Singaporean envoys over new espionage claims.