Malaysia's water industry set for reforms but no liberalization

Malaysia's water supply and services are set to undergo major reforms under two proposed laws but the government has assured that foreigners will not be given control of the industry, a newspaper report said Wednesday.

Photo: Malaysia's water industry set for reforms but no liberalization

Under the proposed 2006 National Water Services Commission Bill and Water Services Industry Bill, which are expected to be debated in parliament next week, control of all water departments in the country's 13 states will be given to the federal government. Water resources currently come under state jurisdiction.

The move followed frequent complaints of muddy drinking water supply to homes in some areas as well as irregular delivery, including in the most developed state of Selangor as well as in rural Sabah state on Borneo island.

However, consumer activists and opposition lawmakers have expressed concerns that the bills could eventually put control and ownership of water supply in the hands of foreigners, and make water rates more expensive.

Energy, Water and Communications Minister Lim Keng Yaik assured critics that Malaysia would not liberalize the water industry as it was considered a basic utility and would not be opened to international investors.

"Malaysia will not make a liberalization commitment in the World Trade Organization for water supply and water services," he was quoted as saying by The Star.

Lim said the move was targeted at improving services and helping states with water supply infrastructure.

He revealed that state governments now owed a massive 7.6 billion ringgit (US$2.1 billion, Ђ 1.8 billion) to the federal government in loans for water-related projects such as laying of water pipes, construction of treatment plants and setting up catchment areas, reports the AP.

I.L.