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S'pore - thanks to Malaysia's Dr M, our water industry is now worth $9 BILLION!

Written by mevotex
Fresh water has always been a precious resource to Singapore. Being a tiny island with high urban population constrained by its land size, modern Singapore never have enough water of its own to support its population, but this is about to change....


In 1927, Singapore signed a water agreement with Johor to construct a pipeline transporting raw water from Johor to Singapore. During the Battle of Singapore in 1942, the pipeline was destroyed, which left Singapore with water reserves that could last at most two weeks. According to Lee Kuan Yew, this was one of his motives to envision water self-sufficiency for Singapore later when he became the city-state's Prime Minister.

Immediately after the British awarded self-governance in 1959, the Singaporean government under Lee signed 2 water agreements with Malaya in 1961 and 1962. Under these agreements, Singapore will build two water treatment plants in Singapore and a new, expanded pipeline from Johor at its expenses. Singapore will also supply treated water to Johor at far below the cost of treating the water, and in return, Malaya would also supply raw water to Singapore below market prices. The agreements would last till 2011 and 2061 respectively.

In 1965, when Singapore was expelled from the Malaysian Federation, it received the first water threat from then Malaysian Prime Minister Tunku Abdul Rahman, who said that "if Singapore’s foreign policy is prejudicial to Malaysia’s interests, we could always bring pressure to bear on them by threatening to turn off the water in Johor".


In response, Singapore began to construct more water schemes on the island throughout the 1970s. This include the damming of river estuaries to allow for greater storage volumes, which resulted in larger artificial reservoirs that collect water from carefully managed catchment areas. These reservoirs would later be responsible for 20% of Singapore's water needs in 2012.

But as Singapore began to rapidly industrialize, the amount became insufficient. Thus in 1982 the city-state was interested to build a dam on the Johor River in Malaysia and an associated new water treatment plant there, with the construction costs all paid by Singapore, in exchange, Malaysia was to allow Singapore to purchase more than the 250 million gallons of water per day as negotiated in the 1962 agreement.

Malaysia's Prime Minister Mahathir Mohammad however, decided to make it difficult for Singapore. After six years of difficult negotiations, the 2 countries finally signed the agreement that allowed the construction of the dam. It was a heavy price for Singapore, who agreed to pay RM320 million as compensation for the permanent loss of use of the land and its associated revenue, a premium of RM18,000 per hectare of land, and an annual rent of RM30 for every 1,000 square foot of the land. The cost of building and maintaining the dam would be borne by Singapore, and upon the expiration of water deals, both the dam and the treatment plant are to be returned to Malaysia.

Mahathir believed that Singapore couldn't survive without Malaysia's water

Emboldened by this victory, Mahathir mistakenly believed that he had caught Singapore's main weakness. In 2000, attempts to re-negotiate with Malaysia to secure water supply beyond 2061 failed, and in 2003, Malaysia again warned Singapore that once the first treaty expired in 2011, the water prices would be raised by 200 times from 3 sen per 1,000 gallons to RM6.25. The government of Singapore decided that, instead of paying a higher price and continue its water dependence on Johor, it will go all-out to achieve water-sufficiency.

The first thing Singapore did was to invest heavily in water technologies and gathered the world's most renowned water management scientists into the island. Academics, researchers, scientists and experts from across the globe were invited to Singapore to help it devise a water solution. Desalination and recycled water were identified. Utilizing advanced technologies, Singapore proceed to construct one of the world's largest desalination plant in 2005, now accounted for 10% of the country's water needs. Singapore's second plant, even bigger, is scheduled to complete in 2013, providing another 10%.

Desalination removes salt and other minerals from sea, turning sea water into fresh water. There is almost no controversy on this. The issues come when dealing with recycled water. By that it means waste water, including those from toilets and drains, is to be purified back for use. The concerns lay on whether all harmful materials, pathogens or micro-organisms could be effectively removed.

Singapore invites scientists across the world to solve its water dilemmas

Lee Kuan Yew Water Prize was established to award $300,000 for scientists of any nationalities who made breakthrough in water treatment technologies and brought them to Singapore. In 2003, Singapore started its first wastewater recycling plant. Under constant advices and supervision from scientists and researchers, by 2012, the country's 5 wastewater plants successfully marketed themselves and provide enough clean water to meet 30% of the island's needs.

‘Public acceptance is not guaranteed at the start. Recycled water has been rejected in Australia, where people term it ‘yuck’ water,’ said Dr Eduardo Araral, assistant dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore. ‘Singaporeans accepted it both because they are pragmatic and because they trust the Government’s promise that it is safe to drink,’ he added.

In 2006, Singapore identified the commercial value of water and environmental technologies, especially to water-scarce Middle East, North Africa and various First World nations, and also countries who currently lack proper and effective water treatment system. The government invested an initial $330 million to promote the new industry and to make Singapore a potential global hub for water research and development. Since 2008, the city-state hosts the Singapore International Water Week, a key event for the global water industry, every year.

Technologies power up Singapore's water industries

Over the years, Singapore has turned what used to be a scarcity into its strength and now the water industry is seen as a new growth sector for the country. The government's commitment to industrial promotion, easy access to research funds, and readily available talents, help built up a new robust water industries in Singapore amid the European financial crisis.

Kow Juan Tiang, group director for Environment & Infrastructure Solutions at IE Singapore, said: “If you look at the water industries in Singapore, it encompasses companies from many countries. Our financial sector worked closely with those companies venturing overseas here for projects to secure technology, solution, and most importantly, money financing, at a competitive advantage compared to otherwise in (crisis-laden) Europe.”

Goh Chee Kiong, director of Cleantech Building & Infrastructure Solutions at Economic Development Board, said: “What is helping this sector is the fact that Singapore has a vibrant manufacturing industry comprising chemicals, pharmaceuticals, semiconductor, oil and gas, and they are becoming prove points and demonstration sites for water companies to utilize their technology in Singapore before scaling up to the rest of the world.”

Singapore water companies grabbed 1.5% global market share

The push to develop the industry has drawn attention from some of the world's largest companies like General Electric and Siemens, who invested and created local water companies such as Hyflux that have expanded overseas. "What they are looking to do is create a virtual market for the water business which is much larger than Singapore," said Mr Glen Daigger, chief technology officer of CH2M Hill, an US-based industry consulting firm. "Singapore's ambition to become a water technologies hub in Asia is now a step closer."

With technology as the key driver, the water industries in Singapore experienced strong growth. In just five years, Singapore was propelled from a water-challenged nation to an internationally-recognised name in the global water community - with its water industry blossomed to over 100 companies. The city-state successfully built up a vibrant water industry cluster, with operations which span the value chain, including R&D centres, equipment suppliers, system integrators and EPC firms, project developers and financing organizations.

In 2011, Singapore's water sufficiency rose to 60%. At the same time the 1961 water agreement with Malaysia expired. Singapore informed Johor it would not be renewing the agreement. The next focus would be on total self-sufficiency before 2061, the date when the second agreement lapsed.

Singapore's water sufficiency to top 70% next year, on track for self-sufficient in 2061

Mr Chew Men Leong, Chief Executive of Singapore national water agency PUB, says Singapore will be able to meet its water requirements independently ahead of the 2061 expiration of a century-long supply agreement with Malaysia "if need be". Upon the completion of the second desalination plant next year, Singapore's water self-sufficiency may rise to 70%.

"We have made progress to the point that we are now much more confident in terms of water security and sustainability," said Chew. "If you're asking me this question about when will we ever get self-sufficiency, I will put it this way that we can be self-sufficient if needed to be. Singapore spent $600 million to $800 million a year since 2006 on new technologies to boost its supply, and it is beginning to see results."

"Here, water is an issue of life and death," Chew said. "That's always been the message."


But the greatest consolation is that Singaporean-based water companies secured over 100 international projects worth close to $9 billion last year. That is approximately 1.5% market share out of the $614 billion global water market - for a country with not enough water of its own. Singapore estimated that by 2015, the water sector would contribute 0.8% into the country's GDP, not a bad figure considering it is an industry Malaysia forced Singapore to build.

While successfully fending off Malaysian water threat, Singapore has a new headache. Right now, Singapore uses natural gas to generate 80% of its electricity, with the bulk of those gas imported from Indonesia. Recent media reports have said that Indonesia wants to renegotiate the terms of its natural gas supply contract with Singapore.

A country with no resource of its own, Singapore is importing about 700 million metric standard cubic feet per day of gas from Indonesia under a contract that will expire in 2021.

1 comment:



    SINGAPORE you have shown us how an independent country with little natural resources can achieve wonders including being the country with the highest income per capita to the envy of the rest of the world!

    Since leaving Malaysia in 1965, you utilised what you had - your human resources and brain power and developed into an efficiently transparent best practices economy although at the expense of democratic freedoms.

    All this has been achieved around the same time span as Malaysian mis-leaders took Malaya and its Sabah and Sarawak colonies backwards blindfolded.

    Of course you were first a part of this new colonial scheme in 1963 but you were lucky to get out so early.

    Unfortunately for Sabah and Sarawak they did not have STRONG leaders who stood their grounds and not give in to Malayan bullying so they remained ostensibly as equal "partners" but in time reduced to be mere colonies.

    As with all colonies the people lost control of their resources and destinies. They found themselves once again the victims of oppression and looting. This time on an immense scale and intensity not experienced under British colonialism.

    The Malayan replacement colonial masters looted Sabah and Sarawak to the limit to develop Malaya and enriched many UMNO members and cronies.

    In the same time span Malaysia became an apartheid state rule by one party for 49-55 years. It became a basket case of S.E. Asia and fell back in development and Sabah and Sarawak were reduced to be the poorest parts of Malaysia.

    While Singapore progressed with independence, Malaysia regressed under a feudalist neo-colonial rule and apartheid system.

    Even China emerging from political upheavals was able to surpass Malaysia in 35 years and became the second world economic world powerhouse while Malaysia now is predicted to go bankrupt by 2019. This anticipated insolvency was even announced by the responsible Malaysian government's minister.

    What a shocking state of affairs- running a resource rich country into the ground with vast corruption and inefficient government.

    It reflects a country burdened with lack of honesty and transparency in governance with every one involved wanting to extract the most out of their positions.

    So despite its faults, Singapore stands out as a SHINING opposite example of what an unburdened nation can do with its independence.

    For this - not just for the water, Singapore should be even more thankful to the Malayan government!

    Thus this is the tale of a successful divorce!

    Sabahans and Sarawakians awake and see what we can achieve if we take Sabah Sarawak out of Malaysia.

    Sabah Sarawak have been financing the development of Malaya for 49 years.

    Why waste our money when we should use it to develop our own respective countries?

    Yes we will need an honest and transparent system to catch up with S'pore but with our resources we can be stronger and better than S'pore. It can be done and we must look at this option!

    Life was a lot better before 1963 and now we suffer to enrich Malaya and its colonial elites.

    Simple arithmetic says this is not common sense to stay with the Malaya who are out to rip us off.

    There is not any sound reason to stay. We are not bound stay. The Malaysia agreement has long since been repudiated by Malaya. It is no longer binding on us even if it were legal.

    If Singapore can leave we also can take out our countries. Why wait for more punishments?

    Brunei was smart enough not to buy into the ponzi scheme. It is also free and independent from Malayan domination and looting which was their intention.

    Malaya needs Sabah Sarawak more then they need Malaya.

    No Sabah No Sarawak No Malaysia!


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