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Student number: 1355795

Module: 7SSG5104 Water Resources and Water Policy

Title: A critical evaluation of the sustainability of Malaysia and Singapore’s
management of water resources
Due date: 11 Dec 2013
Student number: 1355795
Word count: 2465

This essay aims to assess the sustainability of the management of water
resources in Malaysia and Singapore. The two nations were once one country. In
1963, the Federation of Malaya, Singapore and two other British colonies in Borneo
Sabah and Sarawak merged to form Malaysia. However, Singapore left in 1965 to
become a sovereign state on its own (Brown, 2013). After almost five decades,
Singapore would emerge as a developed nation with an impressive gross domestic
product (GDP) per capita of US$51,709 in 2012 (The World Bank, 2013). Meanwhile,
Malaysia has also grown to become the third largest economy in Southeast Asia
after Indonesia and Thailand (The World Bank, 2013). In terms of human
development, it is ranked second in the region after Singapore (UNDP, 2013).
Nonetheless, it is still struggling to achieve the status of a developed country with its
GDP per capita at US$10,381, which is five times lower than Singapore’s.
We will examine the natural endowments available to both economies and their
vastly different responses to their endowments post-independence. I will use data
available from Malaysia’s latest Review of the National Water Resources Study
(2000-2050), Singapore’s government agencies and the most recent national water
footprint statistics compiled by Mekonnen and Hoekstra (2011) to support my
analysis. Drawing on concepts including virtual water, allocative efficiency, water
security and sustainability, I will compare and contrast the two countries’ dissimilar
approaches to their water resources. I hope to demonstrate in the end that
regardless of the amount of natural resources available to a state, political will is the
most important factor to achieving water security and sustainability.

Student number: 1355795

Analytical framework
Virtual water
Allan (2011) coined the term in 1992 to raise public attention to the amount of
water embedded in the production of consumer goods, especially food. He noted
that economists have been oblivious to the amount of water needed to grow, extract,
manufacture, package and transport agricultural and industrial commodities.
Consequently, its environmental costs are not internalised in most goods’ prices.
International “virtual water trade” has allowed water-scarce countries to remain food-
secure. Water wars did not happen as water-stressed countries such as those in the
Middle East and North Africa regions could import food from water-rich countries. In
this way, the problem of water scarcity was solved by economic processes beyond
the local water sector. However, poorer countries such as those in sub-Saharan
Africa are usually excluded from the virtual water “trade”. Allan (2011) rightly
observed that water flows upward to money and power.
Later on, Dutch scientist A. Hoekstra and colleagues introduced the concept of
water footprint to calculate the virtual water content in commodities. They published
the first global study on countries’ water footprint in 2002 (Mekonnen and Hoekstra,
2011). Initially they only analysed blue and green water footprints. Grey water
footprint was included in 2007 (Vauham, 2011). What is blue, green and grey water
footprint? Blue water footprint is defined as the consumption of surface and ground
water. Green water footprint refers to the consumption of green or soil water for
agricultural production. Grey water footprint is the volume of freshwater needed to
assimilate pollutants to current water quality standards (Mekonnen and Hoekstra,

Allocative efficiency
The allocation of limited resources for maximum social and economic benefits
in society is a matter of allocative efficiency (Griffin, 2006). Water resources should
be utilised and developed efficiently to boost agricultural and industrial productivity,
fuel economic growth and alleviate poverty (Rijsberman and Manning, 2006).
Farmers should seek to derive more crops per drop while policymakers should strive
to create more jobs per drop. Allan (2011) noted that successful industrialised
economies are marked by a diversification of industries. Citing Singapore as an
example, he highlighted that the city-state could only meet five per cent of its water

Student number: 1355795

needs through local resources. However, the island nation was able to generate
wealth by strategically investing in industries with low water needs to fund 95 per
cent of its imports.

Water security
Malek et al (2013) mentioned that the concept of water security has gained
traction particularly over the past five years. The World Economic Forum in 2009
defined water security as the “gossamer” that links together the web of food, energy,
climate, economic growth and human development challenges that the world
economy currently face. History has shown that water security is needed for any
human civilisation to survive and thrive (Allan, 2011). It is inevitably linked to
allocative efficiency as only effective distribution and utilisation of limited water
resources worldwide can ensure global water security.

Water security and sustainability should go hand in hand. Vauham (2011)
defined sustainable water consumption as the use of water that supports the ability
of human society to endure and flourish into the indefinite future without undermining
the integrity of the hydrological cycle or the ecological systems that depend on it.
Chan (2009) added that all stakeholders must be engaged with each other to ensure
existing water resources are used in the most efficient economic manner without
endangering access to future generations.

Analysis and evidence

First, we will look at the water resources available to each country before
comparing their water footprints and policy responses.

Malaysia: An Overview
Spanning 330,803km2, Malaysia is just slightly smaller than Germany. It is
home to 29.3 million people (Department of Statistics Malaysia). It has abundant
water resources that are unevenly distributed across 13 states, according to the
Natural Water Resources Study (NWRS) commissioned by its federal government in
2011. Located in the tropics, the country receives heavy rainfall (see Table 1 in the
following page) especially during monsoon seasons.

Student number: 1355795

Table 1: Available rainfall in Malaysia (mm/year)

Rainfall Actual Groundwater Surface
evaporation recharge runoff
2,940.6 1,250.3 191.8 1,498.5
Source: NWRS (2000-2050)

There are more than 100 river basins in Peninsular Malaysia and over 50 river
basins in its two Borneo states across the South China Sea. Out of the 578 rivers in
Malaysia, some 21 of them are heavily polluted but the majority remain pristine and
are of drinkable quality. Therefore, Malaysia is currently self-sufficient in small water.
Taking into account population growth, per capita consumption and water demand
from various sectors, the national study estimates that the country would still have
more than enough freshwater to meet its needs for the next 50 years (see Table 2).

Table 2: Projections of water demand 2010-2050

Types of water demand 2010 2020 2030 2040 2050

Potable water (MLD) 14,458 18,618 20,995 23,368 25,455
Irrigated paddy (mcm) 8,266 9,112 8,049 7,641 7,205
Non-paddy crops (mcm) 1,117 1,123 1,113 1,150 1,176
Livestock (mcm) 128.8 179.9 256.4 378.6 578.3
Fisheries (mcm) 1,287 1,593 1,923 2,390 2,898
Total consumptive 44.7 52.0 51.7 53.5 55.1
demand (mm)
Effective rain (mm) 225
Excesses (mm) +180.3 +173.0 +173.3 +171.5 +169.9
Source: NWRS (2000-2050)

However, the national study highlighted that industrialised states such as

Selangor and Penang as well as Kedah, which has the most irrigated paddy
schemes, have almost exploited their surface water resources. It recommended
these states to look into other options such as groundwater, interstate water
transfer, rainwater harvesting and costlier alternatives including recycling
wastewater and desalination.

Student number: 1355795

Singapore: An Overview
Prior to its independence, the Singapore City Council inked its first agreement
in 1927 with the Sultan of Johor in Malaysia to receive 18 million gallons of water per
day (Mgal/day) (Tortajada et al., 2013), equivalent to about 83 million litres per day
(MLD). It signed another deal with the Johor state in 1962 to secure access to water
from the Gunong Pulai and Pontian catchments as well as the Tebrau and Scudai
rivers until 2011. In 1963, it reached the third agreement with Johor to receive up to
250 Mgal/day (1136 MLD) from the Johor River until 2061. Historically, the island
has been reliant on water supply from Malaysia (Tortajada et al., 2013).

Table 3: Key statistics on Singapore, 1965 and 2011

1965 2011
Land area (km2) 580 714
Population 1,887,000 5,184,000
Blue water consumption 75 153
per capita
Total blue water 318 1,728
consumption (MLD)
Catchment coverage (%) 11 67
Water availability 24hours/day 24hours/day
Service coverage (%) ~80 100
Source: Tortajada et al., 2013

Post-independence, Singapore’s water supply planning had to undergo a

radical shift as it strives to become self-sufficient (Tortajada et al., 2013). With only
580km2 of land and a population of almost 1.9 million in 1965, Singapore only had
three reservoirs and catchment areas covering 11 per cent of its land. By 2011, it
has expanded its water catchment areas to include two-third of its land with a total of
17 reservoirs. Currently, about 20 per cent of its water supply comes from the local
catchments (Vanham, 2011). Another 10 per cent is derived from desalinated water,
30 per cent from recycled sewerage (better known as NEWater to Singaporeans)
and the remaining 40 per cent from Malaysia. The island aims to become entirely

Student number: 1355795

self-sufficient by increasing its NEWater and desalination capacity respectively to

meet 50 per cent and 30 per cent of its future demand by 2060. The remaining 20
per cent will continue to be sourced from local catchments.
However, Vauham (2011) pointed out that Singapore only uses one per cent of
its land for agriculture. It is reliant on food import to feed its population. Now we will
move on to compare the water footprints of both countries before proceeding to
evaluate their water policies.

Water footprints
Malaysia’s national water footprint was 2,103m3 per year per capita for the
period between 1996 and 2005 (Mekonnen and Hoekstra, 2011). It is almost 52 per
cent higher than the global average of 1,385m 3 per year per capita. About 32.2 per
cent of its water footprint is virtual water “imported” through trade in food and
commercial goods.
The data for Singapore’s national water footprint per capita per year is not
available from the report. However, its net virtual water import is estimated at 2,548.5
million m3 per year, which is almost five times higher than its direct blue water supply
of 550 million m3 per year (Vauham, 2011). Mekonnen and Hoekstra (2011) further
calculated that Singapore saved almost 2,327 million m3 of water per year on
average between 1996 and 2005 via virtual water “trade”. However, Vauham (2011)
noted that Singapore import some of its food produced from water-stressed river
basins such as from Australia.

Table 4: Malaysia and Singapore’s water footprints, net virtual water import and
national water savings
Malaysia Singapore
(million m3/year) (million m3/year)
National water footprint
- Green water 81,531 2
- Blue water 1,662 17
- Grey water 6,174 1
TOTAL 89,367 20
Net virtual water import

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- Green water (13,353) 1,727.3

- Blue water 851.5 (930.5)
- Grey water (256.2) 1,752.0
TOTAL (12,757.7) 2,548.5
National water saving
- Green water (10,919.4) 1,637.7
- Blue water 2,430.5 (508.5)
- Grey water (584.2) 1,197.4
TOTAL (9,073.1) 2,326.6
Source: Mekonnen and Hoekstra (2011)

Comparing policy responses

In Malaysia, matters related to water have been largely left in the hands of
individual state governments in accordance with the constitution (Saimy and
Mohamed Yusof, 2012). Due to the abundance of water resources, water prices
remain low while wastage is high (National Water Services Commission, 2011).
Water management is fragmented, with water supply, sewerage and drainage being
handled by separate government agencies (NWRS 2000-2050). In addition,
overlapping functions within different levels of government, ministries and
departments create grey areas of responsibilities.
In the 1980s, the national push for privatisation saw most states outsourcing
their water supply services and treatment of sewerage to the private sector (Chan,
2009). Unfortunately, concession agreements were negotiated behind closed doors
between politicians and the companies, with the terms and conditions kept secret
from the public (Tan, 2012). The privatisation exercise had failed to attract significant
private sector investments to develop the country’s water infrastructure. Moreover,
the federal and state governments have had to constantly dish out subsidies and soft
loans to keep some of the debt-ridden private concessionaires afloat (Tan, 2012).
Meanwhile, improvements to the quality and delivery of water services
nationwide have been minimal. Rural areas remain underserved with only one state
Malacca providing 100 per cent coverage to its populace. The percentage of rural
population with connected water supply is the lowest in Kelantan (60.8 per cent),

Student number: 1355795

followed by Sarawak (63.5 per cent) and Sabah (64.2 per cent) in 2012 (National
Water Services Commission, 2011).
In comparison, Singapore has displayed exemplary political leadership and
long-term vision in its water management (Tortajada et al., 2013). Under Singapore’s
first Prime Minister Lee Kuan Yew, the federal government set up the Water
Planning Unit way back in 1971. It carried out a comprehensive study to explore
unprotected catchments and unconventional water sources such as desalination and
recycled wastewater. Singapore’s first Water Master Plan was subsequently
produced in 1972, outlining strategies to diversify local water supplies.
Singapore built its first pilot water reclamation plant to explore the feasibility of
recycling sewerage into drinkable water in 1974. It was shut down as the process
was considered too costly. Groundwater was not an option due to the lack of it.
However, once the island has fully exploited its surface water resources, it began to
reconsider the alternatives of recycling wastewater and desalination in the mid-
1990s. This time, the government invited private sector participation in the
construction and operation of its desalination plant and water reclamation plant
(Tortajada et al., 2013). In 2003, PUB constructed the first three NEWater plants but
the fourth and fifth plants were built by the private sector. In 2005, Singapore’s first
desalination plant, also constructed by a private company, began operations. It
implemented water conservation tax to bear the increased cost of treating waste and
salt water. At the same time, it also provided tax benefits to industries that
successfully reduce their water usage.
The city has always carefully factored in water in its urban planning and
economic development plans. It was mentioned in the 1972 Water Master Plan that “
a single large water-consuming industrial complex could upset demand forecast by a
wide margin at short notice” (Tortajada et al., 2013, p.16). Therefore, Singapore did
not adopt South Korea, Taiwan and Hong Kong’s “industrialise first, consequences
later” development model. The government put in place strict regulations to control
pollution from industries. Furthermore its Drainage and Sewerage Departments were
combined with PUB’s Water Department in 2001. The government also ran public
relations campaign and educational programmes in schools to drive the message
across to the public that water is precious in the island.

Student number: 1355795

As Chan (2009) noted, good water governance is key to achieving
sustainability and water security. Singapore’s political leadership was committed to
achieving its long-term vision in being self-sufficient. From urban planning, economic
development to education, the city-state took water into account. In comparison, the
Malaysian government has been complacent due to an abundance of water
resources in the country. Malaysia’s policymakers have much to learn from


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