World Water Forum 2015: World Water Council, OECD call for global action on infrastructure funding
With financing and infrastructure serving as key themes at the 7th World Water Forum, the World Water Council and the Organisation for Economic Co-operation and Development are calling on policy makers and business leaders to address financing water infrastructure to provide water security for the demands of the global population and global economy.
DAEGU, SOUTH KOREA, April 13, 2015 -- With financing and infrastructure serving as key themes at the 7th World Water Forum -- being held at the Daegu EXCO in the province of Daegu-Gyeongbuk, Republic of Korea, on April 12-17 -- the World Water Council (WWC) and the Organisation for Economic Co-operation and Development (OECD) are calling on policy makers and business leaders to address financing water infrastructure to provide water security for the demands of the global population and global economy.
In "Water: Fit to Finance?" -- a report launched at the World Water Forum -- the WWC and OECD highlight the increasing need for public-private partnerships to drive the construction of major water infrastructure schemes. They point towards a "risk-and-reward" rationality among financiers as a barrier, which has resulted in water infrastructure projects being marginalized compared to other branches of infrastructure investment.
With the increasing use of water for a wide variety of activities -- from agriculture to industry to energy -- water infrastructure needs to be multi-purpose. However, multi-purpose water infrastructure presents specific financing problems in addition to those generic to water. The sums involved are typically large, and some components are not financially profitable, with many different stakeholders being affected and conflicts over priorities arising among them.
However, evidence shows that existing financial sources are available alongside newer sources of funds, such as pension funds, insurance companies, water funds and Sovereign Wealth Funds, climate funds, and green bonds to finance the full range of products, services and functions needed for global water security. The investment is necessary today, since water supply and sanitation alone are expected to require $6.7 trillion by 2050.
"In the last decade, water has gained increased attention in the global political agenda. Yet despite the fact that financing for the water sector can easily be justified by the pressing need to adapt to global changes including climate, population growth and urbanization, investment in water infrastructure is under-developed," said Benedito Braga, WWC president. "Globally, we are simply not doing enough. We must grasp the big picture connected to water and bring together investors, bankers, economic players, and public officials to tackle the infrastructure deficit in new and creative ways."
Angel Gurría, OECD secretary-general, added, "It's important that we get water infrastructure right. Governments need to think harder about coordinating the timing of different water investments, maximizing their efficiency and being ready to exploit new sources of financing."