Singapore will set up two new institutes to bring together experts from around the world to undertake research and develop practical policies to help tackle the critical challenges of keeping the growing number of cities liveable and ensure that they have clean water and sanitation for the people.

Prime Minister Lee Hsien Loong announced this when he opened the World Cities Summit and the Singapore International Water Week at the Suntec City on Tuesday morning.

The new Institute of Water Policy will be part of the Lee Kuan Yew School of Public Policy. It will do research and contribute to the growing water industry cluster in Singapore.

PM Lee stressed the importance of closer collaboration to share expertise and experiences, pursue joint research projects and develop pragmatic, workable solutions.

He also called on the private sector to use Singapore as a 'living laboratory' to experiment and adapt new technologies which might help tackle environmental challenges, which they might them market to the rest of the region and the world.

Over 5,000 delegates from 60 countries are in Singapore for the summit conferences, which will include discussions, as well as visits to various environmental facilities, such as the Semakau landfill and water recycling Newater plants.

Mr Lee also shared with the delegates Singapore's experience in achieving both economic vibrancy and environmental sustainability.

'The sustainable development of cities is one of the key challenges of our time. Good governance is vital in tackling this challenge, and achieving the right balance between economic growth, environmental protection, and high quality of life for urban dwellers,' he said.

'The stakes are high and we have to get it right early. The welfare of our peoples depends on how well we harness our collective ideas, knowledge and capabilities.'

'Countries and cities should work together, so that we make progress towards cleaner, more resource-efficient, and more vibrant cities for the future.'