News

July 2014 Water Finance Update

World Bank-AfDB-ADB-IDB-EBRD-GEFJuly 2014: The World Bank, the Global Environment Facility (GEF), the Asian Development Bank (ADB), the African Development Bank (AfDB), the Inter-American Development Bank (IDB) and the European Bank for Reconstruction and Development (EBRD) undertook a variety of activities during July. Projects were approved across Africa, Latin America, Asia and Europe, addressing issues such as transboundary water management, water, sanitation and hygiene (WASH) services, hydropower and climate resilience.

Among major developments the World Bank outlined their increased infrastructure investment, including in WASH services, and the AfDB launched the Kigali Action Plan (KAP) to mobilize finance to achieve the WASH-related Millennium Development Goals (MDGs), targeting countries in Africa that are not on track to achieve the targets by 2015.

On July 18, the World Bank highlighted the 45% growth of World Bank infrastructure investment during the 2014 fiscal year, from US$16.7 billion to US$24.4 billion, including investments in clean water. The Bank emphasized that the increase in infrastructure investment is critical, particularly given a decline in private sector infrastructure investment, noting a nearly 20% decline in public-private partnerships (PPPs) and private projects from 2012 to 2013. [World Bank Press Release]

The World Bank highlighted the first in a series of studies by the Central American and Dominican Forum for Water and Sanitation (FOCARD-APS), with the support of the World Bank Water and Sanitation Program (WSP), under the Monitoring Progress of the Country in Water and Sanitation (MAPAS), which highlights the need for an additional US$864 million investment per annum to enable meeting of national WASH goals in El Salvador, Honduras and Panama. [World Bank Press Release]

A project to modernize irrigated agriculture and restore water bodies was also highlighted by the World Bank. Approved in 2007, the US$485 million project seeks to improve water availability and reduce increasing agricultural water demand through: irrigation systems modernization in a sub-basin framework; agricultural intensification and diversification; institutional modernization for irrigated agriculture; and water resources management (WRM), including establishing a State Water Resources Management Agency. [World Bank Press Release]

The World Bank also held the 5th information and consultation meeting on the Assessment Studies for the Rogun Hydropower Project (Rogun HPP), from July 14-18 2014. During the meeting 46 civil society groups and representatives from all riparian states of the Syr Darya, Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan, to discuss the draft Techno-Economic Assessment Study (TEAS) Phase 2 Summary Report and draft Environmental and Social Impact Assessment (ESIA). The draft reports identify the feasibility of constructing the project within “modern international norms” pending design modifications [World Bank Press Release 1] [World Bank Press Release 2]

The World Bank approved US$150 million in additional financing, through the International Bank for Reconstruction and Development (IBRD), for the Second National Water Supply and Sanitation Project (NWSSP2) in Azerbaijan. The project aims to improve water supply quality and reliability and expand access to WASH services in regional centers. [World Bank Press Release 1] [World Bank Press Release 2]

The World Bank also highlighted the Niger River Basin Management Project, the project is investing US$7.5 million through Cooperation in International Waters in Africa (CIWA) to strengthen the Niger Basin Authority, make the institutional financially sustainable and operationalize the Niger Basin Water Charter. The project will also promote regional cooperation to reduce the social and environmental impacts and share benefits of the proposed construction of the Fomi dam in Mali. The Niger Basin includes Benin, Burkina Faso, Cameroon, Chad, Côte D'Ivoire, Guinea, Mali, Niger and Nigeria. [World Bank Press Release]

A US$178.5 million credit was approved by the World Bank for the Neeranchal National Watershed Project in India. The project aims to address regions where rain-fed agriculture predominate and aims to strengthen the capacity of national and state level institutions charged with implementing watershed programmes, support development of integrated science-based, participatory watershed plans, and help farmers adopt climate smart agriculture practices to increase resilience to climate impacts. [World Bank Press Release]

The World Bank also approved US$213 million for the Metro Colombo Urban Development Project in Sri Lanka, which following particularly severe flooding in 2010, aims to reduce flood risk brought by climate change-linked patterns of rain. In particular, the project will bolster the flood and drainage management infrastructure of the city, including major canals, floodgates and drainage tunnels in the Colombo water basin. The project also aims to highlight the negative consequences of the 30% loss in basin storage capacity during the past decade and to restore lakes and wetlands to provide natural flood resilience. [World Bank Press Release]

The World Bank approved a US$6 million CIWA grant for the Zambezi River Basin Development Project by the Zambezi River Authority (ZRA). The project will conduct engineering studies and ESIA for the Batoka Gorge Hydro-Electric Scheme (HES). The project stalled since 1987, would be jointly owned by Zambia and Zimbabwe and produce 1600 MW, and is inline with the integrated water resources management (IWRM) plan for the basin. [World Bank Press Release]

The World Bank highlighted outcomes of the On Farm Water Management Project (OFWMP), one of the activities of the Afghanistan Reconstruction Trust Fund (ARTF). The project improved irrigation canals and introduced modern farming practices, such as laser leveling of fields. Achievements to date are demonstrated by production increases and improved quality of life in the Surkhrud District of Nangarhar Province. [World Bank Press Release]

The GEF CEO endorsed several projects during July, including on the Conservation and Sustainable Use of Biodiversity, Forests, Soil and Water to Achieve Good Living in the Napo Province, Ecuador, through the GEF Trust Fund. The project aims to conserve biodiversity and reduce and reverse land degradation. [GEF Project Detail]

The project for the Collaborative Management of Watershed and Ecosystem Service Protection and Rehabilitation in the Cardamom Mountains, Upper Prek Thnot River Basin, Cambodia, was also endorsed. Managed by the ADB, the US$1.1 million investment aims to restore forests and watershed stability. [GEF Project Detail]

A US$1.9 million project was endorsed for Payment for Watershed Services in the Chishui River Basin for the Conservation of Globally Significant Biodiversity in China. The project, managed by the UN Development Programme (UNDP), aims to develop a replicable programme to operationalize payment for ecosystem services (PES) in watersheds. [GEF Project Detail]

The major development at the AfDB was the signing on 2 July by the African Union (AU) and the AfDB of the Kigali Action Plan (KAP) to mobilize US$70 million within Africa to improve WASH in Africa, in part through crowd funding. The Plan was signed as a signal of political leadership and commitment to achieving WASH objectives and hopes to leverage finance through innovative means to achieve the WASH-related Millennium Development Goals (MDGs). The funds will be channeled to ten countries that are “off-track” in achieving the MDGs. [AfDB Press Release]

The ADB has highlighted a project in China to restore Suzhou Creek in China, which was heavily polluted by industrial and human waste. The project diverted sewage from the creek and installed systems to flush and reoxyginate the creek. [ADB Press Release]

The ADB approved US$300 million to upgrade the power system in Assam State, India, including through construction of a 120 MW hydropower plant. [ADB Press Release]

A US$255 million loan was approved by the ADB to prevent river erosion along the Jamuna, Padma and Ganges Rivers in Bangladesh. As a low-lying coastal state, Bangladesh is particularly vulnerable to flooding and erosion, this project will construct structures to protect embankments and build capacity within local communities to maintain them. [ADB Press Release]

The ADB also examined outcomes of a co-financed US$228 million water distribution and wastewater collection project in the Nakchivan region of Azerbaijan. The Bank noted benefits including job opportunities in the water and wastewater management sectors, reduction in water-born illness and reduced burden on women, who had spend much time collecting water. [ADB Press Release]

The IDB announced approval of a US$16.8 million project, with additional support from the EU's Caribbean Investment Fund, to improve WASH services in Guyana. The Program to Improve Water and Sanitation Infrastructure and Supply, will include institutional strengthening of the service provider Guyana Water Incorporated (GWI) and include a public awareness campaign on WASH. [IDB Press Release]

The EBRD approved a EUR10 million loan to Moldova to improve water supply in the northern region. The project aims to partially privatize the water system in the region, with a private operator working as part of a joint operating company. The project will expand and improve services for 190,000 people and improve operating efficiency of water supply systems. [EBRD Press Release]

A US$50 million EBRD loan will help modernize the Qairokkum hydropower plant in Tajikistan. The project will increase the productive capacity of the plant from 126 MW to 142 MW and improve the climate resilience of the dam. [EBRD Press Release]