Water Privatization, Ethnicity and Rent-Seeking: Preliminary Evidence from Malaysia


Jeff TanFollow

Document Type



This paper examines the ongoing promotion of infrastructure and water privatisation in Malaysia despite the failure to increase capital investment and improve efficiency. It locates privatisation within the process of capital accumulation, with rents and rent-seeking an integral part of this. In this context, water privatisation provides opportunities for the creation of entrepreneurs through the allocation of rents in the form of water-related contracts. The paper provides preliminary evidence, drawing from privatised water and sewerage projects in the state of Selangor to illustrate how this offers rents for both Bumiputera (Malay) and non-Bumiputera entrepreneurs. Rent-seeking is driven by changes in social formations and specifically the emergence of a Malay middle class that needed to be politically accommodated.

Publication (Name of Journal)

Journal of Southeast Asian Economies