AT A GLANCE: - The World Bank Group is the largest external financier in the water supply and sanitation (WSS) and irrigation sectors, as well as in river basin management and trans-boundary water programs in developing countries.
- The water portfolio of the World Bank Group includes investments across a wide spectrum of activities. In FY07, new lending commitments were made in water supply and sanitation services (US$3.8 billion), irrigation and drainage (US$0.9 billion), water resources management (US$0.8 billion), and hydropower (US$0.5 billion) 1. The Bank also supports improved water services delivery and water resources management through enhancing technical knowledge, building institutions, and nurturing government policies.
The Global Water Challenge
The challenges in the water sector include issues of quantity, quality, timing, and access to services. As water becomes increasingly scarce relative to the needs of growing populations and economies, water quality is increasingly compromised and water sources (watersheds, recharge areas, and wetlands) are encroached upon. As well, challenges associated with developing and managing water resources in a sustainable manner become more acute. In addition, climate change is expected to have diverse impacts on the water cycle, including altered river flows, accentuated lake level fluctuations, groundwater recharge and more extreme events (e.g., intense floods and longer droughts) and, by corollary, approaches to adaptation, water regulation, and infrastructure. Today, about 700 million people live in countries experiencing water stress or scarcity. By 2035, it is projected that 3 billion people, more than one third of the world’s population, will be living in conditions of severe water stress. Many countries with limited water availability also depend on shared water resources, increasing the risk of social or even international conflict over these scarce resources. Needs and Priorities for Poverty Alleviation Water for People (Water Supply and Sanitation)
Millennium Development Goal (MDG) Target 10 – to halve by 2015 the proportion of people without sustainable access to safe drinking water and basic sanitation – is daunting. Over the past 20 years, more than 2.4 billion people have gained access to water supply and 600 million to sanitation. Yet 1.1 billion more still lack access to water supply services and 2.6 billion lack sufficient sanitation. Access to adequate water supply services and sanitation are major factors in reducing child mortality. About 1.7 million deaths per year worldwide (90 percent of which are children) are attributed to water and sanitation-related diseases, such as infectious diarrhea. Water for Food (Irrigation and Drainage)
Improved water management has brought enormous benefits to people in developing countries. In agriculture, which accounts for nearly 70 percent of global water use, expansion of irrigation and increased productivity from 1950 to the mid-1980s raised global per capita grain production by 38 percent, while grain prices have dropped by about 50 percent. Production growth can be attributed to an increase in irrigated land area (from 110 to over 270 million hectares), as well as increased productivity. Water for Energy (Hydropower)
Hydropower provides about 20 percent of the world’s electricity and 90 percent of all electricity generated by renewable sources. While approximately 70 percent of hydro potential has been harnessed in Europe and North America, only about 20 percent has been tapped in the developing world (this figure is 7 percent for Africa). Hydropower will play an important role in responding to climate change, both as a low-carbon source of energy and for the management of extreme events through water storage. Water for Environment
The protection of water sources – watersheds, aquifer recharge areas, and wetlands – is central for ensuring that water is available for its multiple uses. Environmentally sustainable management of rivers, lakes, aquifers, wetlands, and estuaries entails balancing the benefits gained through water supply, agricultural, industrial, and energy development with the benefits provided by healthy freshwater ecosystems. The level of protection to be afforded to a freshwater ecosystem is a social decision that needs to be informed by sound science and public policy. The goal is to support informed decision making and investment for environmental conservation and management. Implementing the Water Strategy Efficient water management coupled with sustainable infrastructure development is a vehicle for increased growth and poverty reduction. The World Bank is implementing a sector-wide strategy aimed at providing effective, tailored water resources management assistance to countries in an economically sound, socially acceptable and environmentally responsible manner. By improving water-related services (sanitation and water supply, irrigation, and hydropower) through investment in water management institutions and infrastructure, while also safeguarding essential environmental and social values, the strategy aims to make a significant contribution to halving global poverty by 2015. Since the approval of the strategy in 2003: - Assistance for strategic planning in water by clients has expanded. This includes completion of 20 Country Water Resources Assistance Strategies (CRWAS).
- There has been a dramatic increase in lending in all water sectors and themes, from the four years before the strategy (FY00-FY03) to the subsequent four years of strategy implementation (FY04-FY07): (i) water supply and sanitation lending rose from US$1.0 billion to US$1.8 billion per annum; (ii) irrigation lending went from US$260 million to US$800 million per annum; (iii) water resources management financing increased from US$270 million to US$550 million, and (iv) hydropower financing rose from an average of US$215 million to US$332 million.
- Major programs for managing river and lake basins, and aquifers, wetlands, and trans-boundary waters are under implementation.
- The quality of lending on all IEG (Independent Evaluation Group) indicators has improved.
- A major partnership, the Bank/Netherlands Water Partnership Program, has been renewed, creating a US$28 million trust fund program to be administered through June, 2009. Similarly, The Bill and Melinda Gates Foundation has made US$28.5 million available to the Water and Sanitation Program for piloting the promotion of sanitation and hygiene, at scale, to support meeting the MDGs.
- In 2007, water and sanitation services, hydropower, irrigation and drainage, water/environment, and water resources management practices were brought under unified management at the regional and central levels to strengthen the Bank’s capacity to address water related challenges in a comprehensive and sustainable manner.
Partnerships
- Global water challenges cannot be effectively addressed through isolated efforts; harmonization and coordination of knowledge, investment, and policy are essential to maximize the contributions of each player. The Bank is engaged in a wide variety of partnerships on water, including:
- Water and Sanitation Program (WSP). A 20-year old partnership hosted by the World Bank to improve the access of poor people to water and sanitation services through capacity building, developing and testing innovative approaches, advocacy, and knowledge-sharing. In FY07, the WSP dedicated approximately US$28 million to implement 125 projects in 25 countries.
- Bank-Netherlands Water Partnership Program (BNWPP) and Bank-Netherlands Water Partnership (BWNP). A support instrument that enhances World Bank operations and promotes innovative approaches that add value to water resources management and water supply and sanitation operations.
- Global Water Partnership (GWP). A global initiative based in Stockholm and mandated to develop networks and knowledge for water resources management.
- World Water Council (WWC). An international water policy think tank charged with promoting awareness, building political commitment, and triggering action on critical water issues at all levels.
- International Commission for Irrigation and Drainage (ICID). The Commission is a scientific & technical, voluntary, not-for-profit organization dedicated to enhancing the world’s supply of food and rural development.
- International Program for Technological Research in Irrigation and Drainage (IPTRID). The Program, hosted by the FAO in Rome, has the objective of developing innovative technologies for irrigation and drainage.
- ### - Please see the following websites for more information on the World Bank’s work in: Water Resources Management (www.worldbank.org/water) Water Supply & Sanitation (www.worldbank.org/watsan) Updated March 2008 Media contacts:
Roger Morier, 202-473-5675, Email:Rmorier@worldbank.org
[1]Note that there is some overlap between these categories, so that these figures should not be summed. These figures do not include related investments sucha as management of transboundary waters supported by the Global Environment Facility (GEF) and restoration of river and lake basins, wetlands, and aquifers. ANNEX: Water Sector Key Figures Water supply and sanitation (WSS) - 1.1 billion people lack safe water supply
- 2.6 billion people lack basic sanitation; 40 percent of the world’s population do not have a toilet.
- About 1.7 million deaths a year worldwide (90 percent of which are children) are attributed to sanitation-related diseases, such as infectious diarrhea.
- Today about 700 million people in 43 countries live below the water-stress threshold of 1,700 cubic meters per person. By 2025 that figure is projected to reach 3 billion – and 14 countries will slip from water stress to water scarcity (below 1000 cubic meters per person).
- Ability to manage water and climate variability in Africa, as measured by per capita water storage, amounts to less than one-fiftieth that in North America or Australia.
- Economic and social costs of poor water supply and sanitation are considerable. For instance, economic costs related to poor WSS are estimated at one percent of GDP for Colombia, El Salvador, Peru and Guatemala. Projections for Ethiopia show that GDP growth rates can drop by as much as 38 percent when the direct and indirect consequences of rainfall variability are taken into consideration.
Worldwide water abstraction by sector - Agriculture: 70 percent (higher percent in many developing countries)
- Industry: 22 percent
- Domestic needs: 8 percent
Irrigation - Irrigated land has increased from 110 million hectares in 1959 to 277 million hectares in 2003.
- “Crop per drop” – water needed to produce food for one person – has decreased over the past 40 years, from 6 cubic meters per person per day to 3 cubic meters per person per day.
Investment needs - Current annual investment in WSS in developing countries is $15 billion. In order to reach the MDGs this amount must be doubled to $30 billion per year (this number excludes wastewater treatment).
- Current annual investment in all water-related sectors is $75 billion. In order to create water security this should increase to $180 billion (this number excludes large hydraulic infrastructure, source: World Water Vision, 2000).
Public-private partnership - To date, private financing in water supply and sanitation has accounted for less than 10 percent of total investments in developing countries.
- Approximately 522 WSS projects with private sector participation have been awarded in 58 developing countries over the period 1990-2006, with a total of $52.6 million in commitments.
Tariffs and subsidies - 40 percent of utilities charge a tariff that does not cover operation and maintenance.
- In most water programs studied, the poorest 40 percent of the population receive only 5-20 percent of the subsidy benefits.
Development assistance - Only 12 percent of total aid to the water sector is going to countries where less than 60 percent have access to water supply.
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