Singapore intends to establish a consulate in Johor, said the country's Foreign Minister George Yeo.

Yeo said he expressed Singapore's intention during a meeting with Malaysian Foreign Minister Syed Hamid Albar on the sidelines of an Association of Southeast Asian Nations (Asean) retreat in Cambodia last week.

"On the whole, our relations with Malaysia are good and getting better," Yeo told parliament.

"We're moving onto a more mature track. We are able to segment areas where we think we can move forward and areas where we cannot, and move in the areas we think we can move ahead."

Malaysia and Singapore have strong economic ties but the two nations have squabbled periodically since Singapore was ejected from the new Malaysian federation in 1965 due to race politics.

Among the outstanding issues are the price of water that Malaysia supplies to resource-scarce Singapore, the future of Malaysian-owned railway land inside Singapore and rival claims to a rocky islet.