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Singapore and Malaysia have a long standing conflict over water supplies.

On 1 September 1961, the Federation of Malaya signed an agreement giving Singapore the right to draw up to 86 million gallons of water per day collectively from the Tebrau River, the Scudai River, the Pontian Reservoir, and the Gunung Pulai Reservoir, with effect through 2011. On 29 September 1962, a further agreement was signed providing Singapore the right to draw up to 250 million gallons per day from the Johore River, with effect through 2061. Both agreements stipulated the price of 3 Malaysian cents per 1,000 gallons.

The Malaysian government has stated that the agreements were signed during a different time and that the price should increase. They cite the example of water sold by China to Hong Kong in the past, which was approximately $8 per 1,000 gallons. However, this price comparison is not directly applicable because while China has borne the cost of constructing and maintaining the infrastructure to provide water to Hong Kong, Singapore paid for all the costs of the reservoirs in Johore, the dams, pipelines, plant, equipment, etc. and Singapore continues to pay all the costs of operating and maintaining this infrastructure.

Malaysia has always been a reliable provider of water to Singapore, but Malaysia has often used threats of cutting off the water supply to pressure Singapore politically. Seeking greater political independence and freedom from such pressures, Singapore has pursued a costly strategy of developing self-sufficiency of water sources.

As of 2003, about 40% of Singapore's water came from Malaysia. This proportion has been decreasing as Singapore has pursued its Four Tap Strategy of sourcing water from rainwater, recycling, desalination, and importation. As new desalination and recycling plants come online and new dams are built to create additional reservoirs, Singapore's dependence on imported water decreases. With decreasing dependence, the potential for conflict is reduced.

[edit] Further reading

• Lee Poh Onn (2003). "The water issue between Singapore and Malaysia: no solution in sight?" (PDF). Ecomics and Finance No.1. Institute of Southeast Asian Studies. http://www.iseas.edu.sg/ef12003.pdf. Retrieved 2008-01-18. 

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