Singapore Water Report Q1 2015
BMI View: This quarter we have expanded and revised our forecasts. We now forecast water extraction bysource, mains and non mains consumption, losses, treated wastewater and household connections, on top ofour previous content. Overall we view the Singaporean water services sector as one of the most advancedglobally, but offering limited opportunities for private sector involvement. The water infrastructure sectoron the other hand is far more open. However, although the volume of available water is rising, thecontinued reliance on imported water can pose a risk of water shortages to heavy water-consumingindustries.
Although pipelines and water projects are very much secondary in terms of value, we are seeing moreactivity in the water utilities sector as the government is keen on diversifying its water sources to ensure areliable and resilient water supply due to its importance to national security. The country is significantlyreliant on water imports from Malaysia to meet its needs (about 40% in 2003) but water agreements thatlegally require Malaysia to export water to Singapore are set to expire by 2061. Therefore, we expectSingapore's water utilities sector to offer significant growth opportunities as the government has plans toimprove water-related infrastructure over the long term. We forecast real growth in Singapore's waterinfrastructure industry value to average 4.2% per annum between 2014 and 2018. This robust growth servesas a major support to growth in the energy & utilities sector.
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