MALAYSIA is not facing the risk of “water bankruptcy” as its natural water resources remain sufficient, but urgent transformation in water management is required to ensure long-term sustainability, according to the Ministry of Energy Transition and Water Transformation (PETRA).
In a statement issued in Putrajaya on Tuesday, the ministry said the country continues to enjoy abundant rainfall and renewable water resources, indicating that physical water scarcity is not the primary challenge.
Malaysia receives an average of more than 2,500 millimetres of rainfall annually, with estimated renewable water resources exceeding 580 billion cubic metres each year.
“The real challenge is not water scarcity, but how we manage, protect and optimise water resources strategically to ensure security, adaptation and long-term sustainability of water supply,” the ministry said.
PETRA’s statement was issued in response to recent media reports highlighting concerns over global “water bankruptcy”, including commentary that the term encompasses not only water shortages but also declining water quality due to pollution.
The ministry noted that key issues requiring attention include integrated water storage management, encroachment into catchment areas, river pollution, and the lack of integration between alternative water sources such as groundwater, in-line and off-river storage, recycled water, rainwater harvesting systems and desalination.
It also highlighted structural challenges within the national water system, noting that active dam storage capacity is generally sufficient to last up to 90 days, or approximately three months.
However, non-revenue water (NRW) remains a major concern, with the national rate currently at around 34.3 per cent, representing an estimated 6,000 million litres per day of treated water lost.
The ministry said this translates into potential annual losses of nearly RM2 billion. If NRW were reduced to 25 per cent, the country could recover approximately 2,000 million litres of additional water daily without constructing new treatment plants.
Water demand is projected to rise significantly, from about 19,372 million litres per day in 2025 to more than 25,000 million litres per day by 2030, based on treatment plant design capacity, necessitating more strategic planning for new sources.
Malaysia currently has 2,986 river basins, with around 30 per cent of major basins identified as facing moderate to severe pollution pressure due to industrial discharge and uncontrolled land use, which could affect the operation of water treatment plants.
PETRA also noted that existing water tariffs for some operators are only sufficient to cover current operating costs, underscoring the need for broader structural reforms.
The ministry called for accelerated implementation of Integrated Water Resources Management across major river basins, alongside strengthened water storage strategies through in-line and off-river reservoirs, enhanced dam capacity and function, systematic mapping of groundwater resources, and expanded research into resilient and competitive water technologies.
It also emphasised the role of digitalisation and artificial intelligence in improving water sector efficiency, including the development of a national digital water sector hub to be launched within the year, with regional expansion targeted by 2040.
New financing approaches, including public-private partnerships and performance-based funding, were also highlighted as necessary to speed up NRW reduction programmes and alternative water resource development.
The ministry further stressed the importance of sustained public awareness campaigns, noting that domestic water consumption in Malaysia remains at around 225 litres per person per day, above the World Health Organization’s sustainable benchmark of 165 litres.
While reiterating that Malaysia is not a water-bankrupt nation, PETRA cautioned that without comprehensive and integrated reforms, supply pressures could emerge in certain areas by 2030.
Aligned with the Malaysia MADANI framework, the ministry said the implementation of strategies under the AIR 2040 framework would not only safeguard national water security but also position Malaysia as a regional centre of excellence in the water sector by 2040. - March 24, 2026
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