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| # Singapore: Water Treatment & Wastewater Recycling Systems           |
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| Haw Cheng NG                                                          |
|                                                                       |
| Date (05/2008)                                                        |
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####### Summary

####### 

The Singapore market is ripe for new and innovative water treatment and
wastewater recycling systems as it continues its effort to achieve water
independence.

Singapore is a small country of only 4.6 million people with limited
water resources. The country imports approximately 52% of its water from
Malaysia. However, two water agreements with its neighbor are due to
expire in 2011 and 2061.

There is concern about Singapore\'s future water security, and to meet
its water challenges, the island city-state has invested heavily in
research and technology over the last four decades and has also
developed world-class capabilities in total water management.

With the development of major national water projects such as NEWater
(recycled water), the Deep Tunnel Sewerage System (DTSS), desalination
and rainfall storage like the Marina Barrage, Singapore is becoming
increasingly independent when it comes to water. The result is a
thriving water industry with more than 50 international and local
companies active in the Singapore market. Singapore's strategic location
in Asia has also attracted major global players to use the country as a
launching pad to expand into the region as well as a test-bed for new
water technologies.

#######  

####### Market Demand

####### 

Since 2001, the Public Utilities Board (PUB), Singapore's national water
authority, has outsourced some US\$3.0 billion worth of water
infrastructure projects, such as the Deep Tunnel Sewerage System, Marina
Barrage, NEWater facilities and desalination plants, to the private
sector. In addition, the Government of Singapore (GOS) is encouraging
industrial users to conserve and recycle water through a media campaign,
legislation and economic incentives.

The water conservation and recycling equipment market is growing in
tandem with the flourishing water sector. The current size of the market
for water conservation and recycling systems is estimated at US\$950
million. The recent economic upturn significantly increased water
demand. In the past year, some trade sources reported that their sales
of water conservation and recycling systems improved by as much as 50%.
The sector has also seen much greater sales to the Government of
Singapore.

The size of the market for water conservation and recycling systems is
projected to expand by 10%-15% annually over the next three years. This
growth will emanate from a strong demand for government projects
including the construction of new desalination plants and NEWater
facilities. Market prospects for industrial users are also good and
future demand could be greater as Singapore's economy is expected to
continue robust growth.

Singapore's water supply is currently derived from four main sources,
namely, water from local catchments, imported water from Malaysia,
NEWater and desalination water.

The local water catchments comprise 14 reservoirs and a network of
stormwater collection ponds that help prevent flooding during heavy
rains. By 2009, the local catchments will increase from half to
two-thirds of Singapore's land surface when the reservoir program,
including the Marina Reservoir project, is completed. A series of
pipelines are being built so that excess water can be pumped from one
reservoir to another for storage. With these Reservoir Integration
Programs, the yield from existing reservoirs will be increased. At the
same time, advanced membrane technology will enable the PUB to undertake
a wider range of activities in catchment areas without compromising the
quality of reservoir water.

To supplement the Republic's water supply, Singapore is importing water
under two bilateral agreements with neighboring Malaysia. The first
agreement, which will expire in 2011, provides Singapore with 100
million gallons per day (mgd) of raw water that Singapore treats at its
own facilities. The second deal, which expires in 2061, gives the
city-state a further 250mgd of untreated water. Singapore is striving to
be self-sufficient in its water needs by 2061 when the second supply
contract with Malaysia expires.

Currently, Singapore's four NEWater plants process more than 45mgd. With
the latest award of contract for the fifth and largest NEWater plant at
Changi to Sembcorp Utilities, NEWater will meet 30% of Singapore's
current water needs by 2010, doubling the original target of 15%.
NEWater is produced using state-of-the-art dual membrane
(microfiltration and reverse osmosis) and ultraviolet treatment process.

Although Singapore has already put in place a sustainable water supply
system through diversification of its water resources, PUB continues to
invest in advanced water technologies and R&D work to look for even more
efficient treatment processes. For example, the Bedok NEWater Factory
was the first in the world to introduce the 16-inch reverse osmosis
membrane in water reclamation in 2006. Another technology is the
membrane bioreactor, which the PUB would like to use to streamline the
NEWater production process and make it even cheaper.

As Singapore's population and economy grow, demand for water will rise.
PUB is responding by looking for more sustainable ways to augment the
country's water supply. As an island nation, the surrounding sea holds
obvious potential. Hence, Singapore's first large-scale seawater
desalination plant was built and commissioned in late 2005 by Hyflux.
Under a 20-year build-own-operate arrangement with the PUB, the US\$167
million desalination facility produces 30 million gallons of potable
water a day that is pumped into PUB's potable water distribution main.
With the successful implementation of the first desalination facility,
it is expected that more desalination plants will be built in the years
ahead. As it stands now, power generation company PowerSeraya (PS)
launched its 10,000 cubic meter per day reverse osmosis desalination
plant in January 2008. PS's plant is the first in the world to use the
cutting-edge 16-inch membrane which results in a higher water yield and
also cost savings, as it uses 30% less electricity than conventional
small membrane plants. PS is interested in scaling up and building
bigger desalination plants to supply the industrial needs as and when
the PUB liberalize the water market.

In order to keep the city-state ahead in water technology, the GOS
earmarked US\$40 million to fund world-class water research centers over
the next five years. The money will be used to train a new generation of
researchers and help start-up firms turn ideas into reality. The first
beneficiary of the program is the Singapore-Delft Water Alliance, an
inter-disciplinary research center set up jointly by the National
University of Singapore, Dutch water specialist Delft Hydraulics and the
PUB. Other international water companies are also taking advantage of
the opportunities and infrastructure by establishing operations here.
Some of these companies are now partnering the PUB in pilot R&D projects
and technology trials. US-based GE Water & Process Technologies signed
an agreement to set up a research center dedicated to water technology
at the National University of Singapore. GE Water will invest US\$87
million over the next 10 years in the research center with specific
focus on water treatment and system integration, fundamental chemical
and membrane application, and ion exchange technology. Black & Veatch
will also invest US\$60 million over the next five years with a view to
strengthen its Singapore base as a hub for desalination and engineering
projects. Several other international players such as Marmon Water,
Siemens Water Technologies, Deltares and Kiwa Water Research of the
Netherlands and local firms Keppel Integrated Engineering, Hyflux,
Salcon and Singapore Utilities International are significantly expanding
their scope of activities in Singapore. Their strategic investments
highlight the remarkable progress made in the water sector, reinforcing
Singapore's vision to become a Global Hydrohub.

####### 

####### Market Data: 

####### 

There are no published statistics to accurately depict the actual size
of the Singapore market for water treatment and recycling equipment.
Trade sources estimate that sales totalled about US\$950 million in
2006. Of this amount, approximately US\$700 million is for government
projects and US\$250 million for sales to private or industrial users.

The Singapore market grew at a rate of about 15%- 20% per year in the
early 2000s. The price of water is high in Singapore, which makes
conservation and recycling viable. In addition, the GOS has the money
and intention to invest in water treatment and conservation facilities.
Furthermore, it encourages industrial users to conserve and recycle
water through legislation, the media and incentive programs.

Over the longer term, future growth is estimated at 20%-25% annually.
Part of this expansion is likely to be the result of new investments in
the GOS' desalination plants. More industrial users will purchase
systems as the technology proves itself and people gain awareness and
knowledge of various systems. Water conservation will become
increasingly important in Singapore as water prices for household and
industrial use continue to rise due to the use of costlier water from
desalination plants. Therefore, there is room for significant growth in
the water conservation and recycling equipment market in Singapore.

####### 

####### Best Sales Prospects: 

####### 

Sales prospects are better for water recycling systems and technology
than for conservation systems. Feedback from the industry indicated that
their water conservation efforts are relatively insignificant and do not
involve special equipment or systems. One supplier of water conservation
systems reported that Singapore buyers are unwilling to allow suppliers
to examine their manufacturing processes and make suggestions.

In the area of water recycling systems, the previous trend was
\"end-of-pipe\" treatment of wastewater. Suppliers are now working with
industrial users to segregate and treat their wastewater at the point of
production.

Water recycling systems with the best sales prospects include advanced
membrane technologies like membrane bioreactor systems, microfiltration,
reverse osmosis, and water disinfection with ultraviolet light. There
are also good opportunities for the sales of entire systems as well as
pumps, valves, sterilizers, crystallizers and other related components.

Major GOS projects are likely to include desalination plants, NEWater
infrastructure and enhancement of water catchment areas.

#######  

####### 

####### Key Suppliers: 

####### 

The U.S. has the major share of the market for water treatment and
recycling systems with an estimated 40%. Other major suppliers include
Europe (35%) and Japan (25%). Among the European suppliers are firms
from the Netherlands, Sweden, the United Kingdom and Germany. Australian
companies also have a presence in the market.

The PUB, National University of Singapore, and the Dutch water
consulting agency Delft Hydraulics signed a memorandum of understanding
with the goal of developing a regional center of excellence for water
knowledge. Delft Hydraulics set up a branch office here and is also
working on a \$3.2 million consultancy project on the Marina Reservoir.

Various suppliers have different strengths. In terms of wastewater
treatment, the Europeans and Japanese have been more active in Southeast
Asia than U.S. suppliers. However, U.S. technologies are regarded as
more advanced and innovative. The Europeans and Japanese are better
known for their strength in desalination technology.

European and Japanese contractors installing water conservation and
recycling systems have a tendency to purchase components from their home
countries rather than from U.S. suppliers.

Local companies are also fast developing their capabilities in the water
arena. Hyflux won two government tenders to build NEWater plants and
Singapore's very first desalination project. Besides Hyflux, other
Singaporean companies, such as Keppel Engineering, SembCorp, Dayen
Environmental, Salcon and Singapore Utilities International, are also
active players.

At least 50 companies currently compete in Singapore. Major U.S.
companies that have a presence in Singapore include GE Water, Black &
Veatch, CH2M Hill, ITT and 3M.

The market positions of various suppliers of water treatment and
recycling systems are not expected to change in the foreseeable future.
The market is becoming increasingly competitive, and technology
differences in the industry are narrowing. The firms that are the most
aggressive, cost competitive, and offer the best service/support will
likely be more successful.

Buyers of water treatment and recycling systems in Singapore are very
receptive to U.S. products. The U.S. has a good reputation for
innovative technology and quality products.

####### 

####### 

####### Prospective Buyers: 

####### 

An important end-user of water treatment and recycling equipment is the
GOS, i.e., the Public Utilities Board under the purview of the Ministry
of The Environment and Water Resources. Key contacts of the GOS agencies
are included in the \"Reference & Key Contacts\" section of this report.

Singapore's fourth and latest NEWater plant opened in March 2007. The
contract for the construction of the fifth NEWater plant was awarded to
Sembcorp Utilities in late 2007. This fifth NEWater plant at Changi will
have an initial capacity of 15 mgd when completed in 2009, which will
eventually produce 50 mgd by 2010. Two other NEWater plants -- Kranji
and Bedok -- will undergo large-scale expansion in the near future. The
five plants' combined capacity means NEWater will meet 30% of
Singapore's water needs by 2010. Other projects to be undertaken by the
PUB can be viewed at
[**http://www.pub.gov.sg/info_center/IcTenders.aspx?l1=4&l2=20**](http://www.pub.gov.sg/info_center/IcTenders.aspx?l1=4&l2=20).

The other key end-user is the industrial sector. Non-manufacturing
buyers include construction sites, hotels and restaurants. The
electronics, chemical and petroleum industries are among the largest
users in the manufacturing sector. Recent reports from the PUB indicate
that the electronics sector accounted for 46% of total water consumption
in the manufacturing industry in 2007 while the chemical sector
purchased 25%.

One of the companies interviewed for this study suggested that
new-to-market U.S. companies focus their efforts on breaking into the
industrial market. The GOS desalination projects are \"one-time\"
activities, while there is more potential for on-going business in the
industrial sector. There is significant room for growth in this sector
with many US\$6-12 million dollar projects to be implemented. In
addition, many local companies are also venturing overseas to clinch
water projects in China, India, Indonesia, Thailand, Vietnam and the
Middle East, particularly in Saudi Arabia, UAE and Qatar.

####### 

####### Market Entry: 

####### 

Many American exporters use agents or distributors to serve the
Singapore and other markets in Southeast Asia. Finding prospective
partners presents no problem. Singapore firms are aggressive when it
comes to representing new products and usually respond enthusiastically
to new opportunities. In addition, most Singaporean companies are open
to joint venture proposals and many are interested in manufacturing
under license.

Technology, price and after-sales service are the main selling factors
in Singapore. Prospective exporters to Singapore should be aware that
competition is strong and that buyers expect good after-sales service.
Selling techniques vary according to industry or the product involved,
but they are comparable to the techniques used in any other
sophisticated market. It is also important for U.S. firms to visit their
representatives and maintain a good relationship with them.

Appointment of Distributor/Agents: there is no special legislation in
Singapore covering agency agreements. In the absence of this, the
Singapore's Common Law of Practice applies.

Methods of Operation for American Companies: the principal methods of
operations for American companies in the Singapore market are through:

\- A branch of the American firm or an associated company incorporated
as a full subsidiary based in Singapore.

\- A representative sent out from the United States and stationed
permanently in the area. He or she may not be directly responsible for
obtaining orders and making sales, but supervises local distributors
and/or agents.

\- An agent appointed in Singapore. Local firms which act as agents
range from small trading companies, working on a small project basis to
large engineering installers representing a number of manufacturers in
several categories of water related equipment. Such organizations handle
a large share of the water treatment and recycling equipment business
and generally have branches throughout the area.

\- Direct sales on an open market basis. This method is only successful
if the U.S. suppliers have already developed well-established
connections.\
\
In view of the competitive nature of the local business environment, it
is recommended that any new-to-market American company appoint a local
representative. Once business has matured, the establishment of a
representative office might then be desirable to serve as a launching
pad into the region.

Trade promotion and advertising: There are specialized trade magazines
in Singapore and many trade fairs
([**http://www.sgmeetings.com**](http://www.sgmeetings.com/)) that could
serve as venues to promote U.S. water treatment and recycling equipment
and technologies. The major English language daily newspapers are the
Straits Times and the Business Times and are available at
[**http://www.asiaone.com**](http://www.asiaone.com/). The business
magazine that has the relevant features on water related themes is
"Water & Wastewater Asia" published by Pablo Publishing Pte Ltd
([**http://www.pabloasia.com**](http://www.pabloasia.com/)). The major
Chinese daily is Lianhe Zaobao
([**http://www.zaobao.com**](http://www.zaobao.com/)). E-Commerce
websites can be found at
[**http://www.ida.gov.sg**](http://www.ida.gov.sg/) and at
[**http://www.sg**](http://www.sg/). Leads for local advertising and
promotional service agencies are located at
[**http://www.yellowpages.com.sg**](http://www.yellowpages.com.sg/).

Financial: Shipments to Singapore are generally made under letters of
credit and sight drafts, depending on the exporter\'s preference and the
extent of past dealings with the purchaser. Standard credit terms are 30
to 90 days. The foreign departments of most major banks are well
equipped to provide service and advice on matters of foreign trading and
credit.

Quotations should be on a C&F basis whenever possible. The prices given
may be either in Singapore or U.S. dollars. Exporters making quotations
in Singapore dollars should consult their banks for the prevailing
exchange rate. Singapore uses the metric system, so it is often
beneficial for price/quantity quotations to be prepared accordingly.

####### 

####### 

####### Market Access & Obstacles: 

####### 

There are excellent opportunities for U.S. firms to sell water
technologies and wastewater recycling equipment into the Singapore
market as the country is virtually a free port. There are no duties,
taxes or tariffs on imports to Singapore of all types of water related
equipment from the U.S. and elsewhere in the world. The challenge is in
competing with all the other suppliers from the world since it is such
an open economy.

All imported goods meant for local consumption are taxable under the
Goods and Services Tax (GST), which is levied at 7.0%. Goods kept in the
Free Trade Zone are not subject to GST, however GST will be charged if
they are later released for local consumption.

Technical Requirements and Standards: The electrical power supply
specifications in Singapore are 230 volts, 50 cycles, single phase and
415 volts, 50 cycles, 3 phase. American equipment for use in Singapore
must conform to these electrical requirements.

Internationally recognized standards, such as the American National
Standards Institute, are fully acceptable. SPRING Singapore (the
Standards, Productivity & Innovation Board) is the government
organization that oversees the formulation of industrial standards for
almost every industry sector. Any queries relating to industrial
standards should be directed to SPRING Singapore at 2 Bukit Merah
Central, Singapore 159835; Tel: (65) 6279-1847, Fax: (65) 6272-1937,
Contact: Ms. Susan Chong, Director, Standardization Division, email:
[**suchong@spring.gov.sg**](mailto:suchong@spring.gov.sg).

Intellectual Property Rights: A legal framework that specifically
provides for copyright protection of Intellectual Property has been put
in place under the Copyright Act. A bilateral agreement between
Singapore and the United States on the protection of Intellectual
Property Rights has since been in force. However, American owners must
also register their copyrights in Singapore before they are enforced
locally. Infringement of copyrights should be referred to the U.S.
Embassy for advice and guidance.

####### Trade Event: 

####### 

The following trade event in Singapore is appropriate for the promotion
of all aspects of the water and wastewater recycling systems and
equipment:

Name of Event: Singapore International Water Week

Date: June 23 -- 27, 2008

Show Website: [http://www.siww.com.sg](http://www.siww.com.sg/)

Contact: Mr. Michael TOH, General Manager

Singapore International Water Week

40 Scotts Road

#10-01 Environment Building

Singapore 228231

Tel: (65) 6731-3160

Fax: (65) 6731-9456

Email: <info@siww.com.sg>

Venue: Suntec Singapore

Profile: The inaugural Singapore International Water Week (SIWW) is the
global platform for water solutions that brings together policymakers,
industry leaders, experts and practitioners to address issues relating
to "Sustainable Water Solutions for Cities". Further details can be
obtained from the show website.

####### References & Key Contacts:

\(A\) Government and Statutory Agencies:

Ministry of The Environment and Water Resources

40 Scotts Road

#24-00 Environment Building

Singapore 228231

Tel: (65) 6731-9489

Fax: (65) 6731-9456

Website: [**http://www.mewr.gov.sg**](http://www.mewr.gov.sg/)

Contact: Dr. LEE Tung Jean, Director, Water Studies Division

Email: [**lee_tung_jean@mewr.gov.sg**](mailto:lee_tung_jean@mewr.gov.sg)

Public Utilities Board

40 Scotts Road

#15-01 Environment Building

Singapore 228231

Tel: (65) 6731-9281

Fax: (65) 6235-2118

Website: [**http://www.pub.gov.sg**](http://www.pub.gov.sg/)

Contact: Mr. Harry SEAH, Director, Technology & Water Quality

Email: [**harry_seah@pub.gov.sg**](mailto:harry_seah@pub.gov.sg)

Public Utilities Board

Deep Tunnel Sewerage System Project

DTSS HQ @ 10 Changi East Coast

Singapore 498785

Tel: (65) 6389-7715

Fax: (65) 6389-7775

Website:
[**http://www.pub.gov.sg/our_services/UsedWaterDTSS.aspx?l1=2&l2=9&l3=11**](http://www.pub.gov.sg/our_services/UsedWaterDTSS.aspx?l1=2&l2=9&l3=11)

Contact: Mr. YOUNG Joo Chye, Deputy Director

Email: [**young_joo_chye@pub.gov.sg**](mailto:young_joo_chye@pub.gov.sg)

\(B\) Trade Associations:

####### 

Singapore Water Association

WaterHub

80 Toh Guan Road East

Singapore 608575

Tel: (65) 615-0812

Fax: (65) 6515-0813

Web Site: [**http://www.swa.org.sg**](http://www.swa.org.sg/)

Contact: Ms. Cecilia TAN, Manager

Email: [**Cecilia@swa.org.sg**](mailto:Cecilia@swa.org.sg)

Waste Management and Recycling Association of Singapore

WMRAS Secretariat

1003 Bukit Merah Central #02-10

Singapore 159836

Tel: (65) 6278-2538

Fax: (65) 6278-7518

Web Site: [**http://www.wmras.org.sg**](http://www.wmras.org.sg/)

Contact: Mr. Michael Ho, Chairman

Email: [**secretariat@epc.com.sg**](mailto:secretariat@epc.com.sg)

#######  

####### For More Information

The U.S. Commercial Service in Singapore can be contacted via e-mail at:
<Hawcheng.Ng@mail.doc.gov>; Phone: (65) 6476-9037; Fax: (65) 6476-9080
or visit our website: <http://www.buyusa.gov/singapore>.

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worldwide. Locate the U.S. Commercial Service trade specialist in the
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*Disclaimer: The information provided in this report is intended to be
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its accuracy, neither the United States government nor any of its
employees make any representation as to the accuracy or completeness of
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Readers are advised to independently verify any information prior to
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