Allowing only the sponsor's merchandise should be something that is practiced all over the world. No, this is not a uniquely Singapore thing.
Coca cola might be a sponsor of the YOG event which allows them to put up their billboards, PR stuff around the event BUT does this right extend to what the audience can or cannot drink

If the audience chooses to spend their own money to pay for water what right do the YOG officials have in the matter?
Drinking coke is also not healthy, all that sugar & chemicals which is bad for the health. Just imagine if you are a volunteer spending long hours at the venues & having to pay for & drink coke all day:(