6 November 2014
October 2014 Water Finance Update
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International financial institutions (IFIs), including the World Bank, Global Environment Facility (GEF), African Development Bank (AfDB), Asian Development Bank (ADB), Inter-American Development Bank (IDB) and the European Bank for Reconstruction and Development (EBRD), focused lending in October on water-related disaster risk reduction (DRR) and water, sanitation and hygiene (WASH) services.

World Bank-AfDB-ADB-IDB-EBRD-GEFOctober 2014: International financial institutions (IFIs), including the World Bank, Global Environment Facility (GEF), African Development Bank (AfDB), Asian Development Bank (ADB), Inter-American Development Bank (IDB) and the European Bank for Reconstruction and Development (EBRD), undertook a number of activities in October, focusing lending efforts on water-related disaster risk reduction (DRR) and water, sanitation and hygiene (WASH) services.

The World Bank brought together donors for the ‘Haiti: Clean Water, Improved Sanitation, Better Health’ conference, on 9 October 2014, at their headquarters in Washington, DC, US. In advance of the conference, World Bank Group President Jim Yong Kim pledged US$50 million to help provide access to WASH to prevent waterborne diseases, in particular cholera. [World Bank Press Release 1] [World Bank Press Release 2]

A loan agreement was signed by the World Bank for a US$300 million ‘Floods Emergency Recovery Project’ in Serbia. The project will support sectors and objectives identified in the ‘Recovery Needs Assessment’ (RNA) completed in June and July, which assessed damage and requirements following flooding in mid-May. The project will focus on power sector infrastructure and assistance in the agriculture sector for affected farmers. [World Bank Press Release 1] [World Bank Press Release 2] [World Bank Press Release 3] [World Bank Press Release 4]

The World Bank highlighted outcomes of a US$22.8 investment in 14 water utilities in Ukraine, noting the benefits gained from improving the water supply and wastewater treatment plants of the city of Chernihiv. The project has modernized the city’s water utility, which has improved the quality of water. [World Bank Press Release 1]

The World Bank also outlined benefits of the ‘National Water Supply and Sanitation Company (OSE) Modernization and Systems Rehabilitation Project’ (APL-2) in Uruguay, which aimed to increase the efficiency, transparency, competitiveness and sustainability of water and sanitation services provided by OSE. In order to accomplish, this three international best practices were adopted including: establishing a water balance following the International Water Association’s (IWA’s) guidelines; supporting the strengthening of the Unaccounted for Water Reduction (RANC) unit devoted to non-revenue water; and employing performance based contracts for non-revenue water work. [World Bank Press Release 1]

The World Bank drew attention to outcomes of two projects in partnership with the Global Facility for Disaster Reduction and Recovery (GFDRR), the ‘National Cyclone Risk Mitigation Project’ (NCRMP) in India, and a project in Tonga funded in part by the Africa Caribbean Pacific-EU Natural Disaster Risk Reduction Program (ACP-EU NDRR). The World Bank outlined how the NCRMP helped reduce disaster losses during Cyclone Phailin, in Odisha, India, highlighting that the project streamlined a comprehensive early warning system for hydrological events and built climate resilient infrastructure. In Tonga, the World Bank, GFDRR and ACP-EU NDRR worked after a cyclone in January 2014 to support climate resilient recovery. [World Bank Press Release 1] [World Bank Press Release 2]

The GEF CEO endorsed the project ‘Enabling Transboundary Cooperation and IWRM in the Extended Drin River Basin,’ which aims to engage basin countries in joint management of the transboundary basin, including through engagement with sub-basin commissions including on Lake Prespa, Ohrid and Skadar. [GEF Project Detail]

The AfDB approved a US$231 million package of loans and grants for the ‘Programme to Build Resilience to Food and Nutrition Insecurity in the Sahel’ (P2RS). The programme covers member states of the Permanent Inter-State Committee for Drought Control in the Sahel (CILLS) – Benin, Burkina Faso, Chad, Cape Verde, Côte d’Ivoire, Gambia, Guinea-Bissau, Mali, Mauritania, Niger, Senegal and Togo. The programme will focus on structural causes of acute and chronic nutrition crises, targeting the most vulnerable. One of the first projects of the P2RS will be water mobilization and pastoral facilities to promote sustainable management of natural resources at the household level. [AfDB Press Release]

The AfDB, through the African Water Facility (AWF), is providing a €2 million grant to the Hadejia-Jama’are-Komadugu-Yobe Basin Trust Fund for preparation of a strategic water development plan in the Komadugu-Yobe River basin in Northern Nigeria. The plan will address competing demands on freshwater resources, including increased water demand by urban areas, including Kano city, improve agriculture water management and aquaculture. A key priority will be re-operationalization of the Tiga and Challawa Gorge Dams. [AfDB Press Release]

The ADB and Japan, through the Japan Fund for Poverty Reduction, are providing funds for communities along the Chao Phraya River in Thailand to develop community-based flood risk management plans. The US$2 million grant aims to reduce vulnerability to natural disaster through short- and long-term flood risk management and post-flood recovery planning. [ADB Press Release]

The ADB also granted US$500 million in two loans to the government of Rajasthan, India, to develop an independent utility in Jaipur for water and wastewater operations and a corporate-style state board to develop urban services. Among expected reforms are decentralization of water and sewerage services to municipal authorities, rationalization of water tariffs to ensure revenue streams to support urban services, and metering of the 200,000 new household connections resulting from the project. [ADB Press Release]

A US$40 million emergency assistance grant was approved by the ADB to reconstruct irrigation and road infrastructure lost in floods in 2014 in northern Afghanistan. The floods resulted in damage estimated at US$240 million and the project aims to help communities regain their livelihoods and will further reduce flood risk through construction of retaining walls. [ADB Press Release]

An innovative partnership between ADB and 13 banks was cemented with signature of an agreement to support the Beijing Enterprises Water Group Company Limited (BEWG) in China. The US$288 million B-loan, which allows the ADB to act as lender of record for commercial banks, will allow BEWG to meet the highest level of wastewater treatment standards in China. [ADB Press Release]

The ADB is providing US$100 million to a project for environmental improvement of an urban lake area in Huanggang, China. The project will use integrated approaches to water quality improvement by: removing contaminated sediments; constructing wetlands; stabilizing lake and river embankments; and improving hydraulic circulation. The project is expected to improve water quality and natural flood protection and make the lake an attractive benefit to the urban population. [ADB Press Release]

The IDB is providing US$450,000 to the ongoing ‘Water and Sanitation Operators’ Partnerships (WOP) – Latin America and the Caribbean (LAC) Work Programme’ for the “twinning” of 16 water and sanitation operators, five workshops on best practices, and management of the programme through a website and newsletter. [IDB Project Detail]

The IDB and the EU committed to supporting water supply projects in Guyana. A US$16.8 million loan from the IDB and a US$14.8 million grant from the EU’s Caribbean Investment Fund (CIF) will support the ‘Program to Improve Water and Sanitation Infrastructure and Supply’ to upgrade water treatment facilities and strengthen Guyana Water Incorporated (GWI). [IDB Press Release]

The IDB also approved a US$125 million loan for the ‘Basic Sanitation Program of the Estrada Nova Basin’ (PROMABEN II) in Brazil. The project is expected to connect 9,500 homes to sewage systems, 3,900 homes with piped water supply and improve services for 14,000. [IDB Project Detail] [IDB Press Release]

A US$25 million loan was approved by the IDB for the ‘Second Generation Sanitation Sector Reform Program III’ in Peru. The programme will implement policy reforms, including: improving governance of service providers; strengthening capacity of regulatory authorities; and improving the quality and transparency of the tariff system. [IDB Project Detail]

The EBRD is providing €12.7 million as part of a €70 million project in Albania to retrofit the Komani hydropower plant. The dam has not received maintenance in 30 years and poses a danger to downstream communities. The project will improve the resilience of the dam to extreme weather conditions. [EBRD Press Release]

The EBRD and the Swiss State Secretariat for Economic Affairs (SECO) are providing a US$3.5 million loan and a US$5.35 million grant, respectively, to upgrade the sewerage network and wastewater treatment plan of Khujand, Tajikistan. The programme will modernize sanitation services in the city, reducing pollution and public health hazards. [EBRD Press Release]

The EBRD also highlighted their US$52 million loan contribution to the newly inaugurated Paravani Hydroelectric Power Plant in Georgia. The plant has the capacity to produce 85 megawatts (MW) of renewable energy. [EBRD Press Release]