The portfolio of water projects under implementation amounts to approximately US$20 billion. After a decline in the late nineties, lending is on the rise. In the past two years, the World Bank approved an average of US$ 4.1 billion in new lending to client countries for water projects per year. Since the year 2000, International Bank for Reconstruction and Development (IBRD) lending to water more than doubled and International Development Association (IDA) financing increased by three-fold.

 

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The water portfolio includes investments in water resources management, water supply and sanitation, irrigation and drainage, and hydropower. A growing proportion of water projects span multiple sectors, in response to the increased recognition of the role of water in reducing poverty and promoting economic growth.

The largest share of the portfolio is in water supply and sanitation, where the World Bank’s current project portfolio is US$14 billion.

The largest portfolio of projects across all water sub-sectors is in East Asia & Pacific, followed by Latin America and the Caribbean. The nature of the portfolio varies by region. While in Africa, Latin America and the Caribbean and East Asia & Pacific it is very focused on water supply and sanitation, in South Asia it is focused on irrigation and drainage.

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The portfolio performance for the water sector has improved significantly compared with the mid-90s. The World Bank monitors its quality of lending by identifying Projects at Risk, projects which require greater attention. Overall, the level of commitments at risk dropped from 50 percent in 1995 to 18% in 2009, and has sustained its sound performance since 2000.

The quality of the water portfolio is very much in line with the complete World Bank portfolio. This improved quality was obtained through increased emphasis on quality-at-entry (assessment of the quality of projects as they enter the lending program), and on early closing of nonperforming projects.

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