Necessity is often the mother of invention. As a small island with no groundwater, limited water storage, a rapidly growing population and an expanding economy, it should not be surprising that Singapore has become a global leader in water recycling, conservation and technology.
An extra impetus comes from the country’s reliance on a single source — Malaysia — for imported water, leaving it vulnerable to any diplomatic tensions. As a result, Singapore is determined to achieve water self-sufficiency by 2060, a year before its water import treaty with Malaysia expires.
The city state could serve an example to the UAE, one of the top ten water-scarce countries in the world due to its hyper arid climate — with less than 100mm rainfall per year. The UAE thus far has tackled water scarcity largely by investing heavily into desalination — becoming the world’s second largest desalination producer and today accounting for 14 per cent of the world’s desalinated water.
The UAE could advance its ability to clean wastewater by applying additional treatment processes, such as microfiltration, reverse osmosis and ultraviolet disinfection, similar to Singapore’s NEWater initiative, reducing the need for desalination. The water made available through these processes is widely used in industry, and is even clean enough to drink. The country could also learn from Singapore’s success with technology that prevents water distribution leaks with big data.
But technological know-how alone is not enough to power a water revolution. Capital investment and changes in consumer behaviour are also necessary. Here too, Singapore leads. The city state is not only a major research centre for water technology but, through the establishment of pioneering public bodies such as the National Water Agency (PUB) it also ensured that water security and preservation is firmly at the top of the political and regulatory agenda.
Only countries with similarly strong existential challenges are likely to have the motivation to follow in Singapore’s footsteps towards water sustainability leadership. China stands out as a country that has an acute need to get smart with water. The country is home to 20 per cent of the world’s population but only 7 per cent of its fresh water.
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The authorities are committed: in the first half of 2017 alone, China launched some 8,000 water clean-up projects worth $100 billion. Efforts to change public behaviour are also falling into place, taking the form of education campaigns in schools, higher pollution fines and the appointment of 200,000 local “river chiefs” with personal responsibility for water quality in their areas.
With the government’s backing — and its purse — technology and innovation should not pose too much of a problem either. Singaporean water companies are among those vying to take advantage of Beijing’s nascent commitment to sustainability.
In South Africa meanwhile, Cape Town is facing the prospect of becoming the first city in the world to run out of water, after a catastrophic three-year-long drought. The government is preparing intervention plans in the run up to "Day Zero" — forecast for May 11 this year — when city officials will be forced to cut off the normal water supply to 75 per cent of the city's homes.
But the water problem is not limited to the emerging world. Parts of US and Australia, for example, are threatened by drought, whereas the Netherlands is frequently at risk from floods. Developed nations sometimes lack the strong official focus on water demonstrated by Singapore and China, but benefit from greater involvement by the private sector.
Globally, the motivation to preserve surface water and below ground aquifers is only likely to get stronger. Rainfall patterns are changing, the global population is growing and natural fresh water resources — surface and underground — are being drained. Without action, by 2030, there will be a 40 per cent shortfall of fresh water.
Singapore’s example shows us that a lot of the technology for a sustainable water future is already here — and more is being developed. Other countries are now starting to identify both the existential risks posed by water issues, as well as the opportunities for business and commerce presented by sustainability. With strong commitment to the cause, China and others can learn from Singapore’s example and build on it to create even more sustainable water systems.
Philippe Rohner is a senior investment manager with Pictet Asset Management’s thematic investing team.
