Private, public sector not moving fast enough on water crisis

water graphic joejoe org
Without policies to promote private investment in water, the newly recognised right to water and sanitation is in fact an empty promise: experts at World Water Week 2011. Image:

A high-level World Bank official has urged immediate action from private and public sectors to solve a growing global water crisis which is affecting hundreds of millions of people.

Mr Lars Thunell, chief executive of the International Finance Corporation (IFC) , a World Bank private sector development institution, told participants at the closing session of World Water Week in Stockholm that the world is waking up to a water crisis.

“The world is facing many challenges, but for the life of me I cannot understand why the world refuses to address a crisis that is killing a child every 15 seconds,” said Mr Thunell.

He added that while he was thankful that politicians and businesses were making efforts to mitigate the impacts of the crisis, they were not moving fast enough.

This observation was shared by Professor Malin Falkenmark who said that it is “highly evident that the rate (at) which the water community has worked to secure water and sanitation to everyone is far too slow.” Professor Falkenmark is a globally renowned water expert currently serving as Senior Scientific Advisor to the Stockholm International Water Institute.

According to a 2008 joint report by the World Health Organisation and UNICEF, 884 million people – about half of whom live in Asia – still rely on drinking water from untreated sources such as ponds, streams, irrigation canals and unprotected dug wells.

While water supply and sanitation are important, Professor Falkenmark said that the global community will increasingly need to look at ways to tackle additional water security problems such as increasing rain storms, more frequent and severe draughts, increasing water pollution, deteriorating irrigation systems and land use effects, such as soil erosion and soil degradation.

Regarding these additional water security problems, Mr Thunell said that the continued rapid urbanisation of the world will push the water crisis to its limits.

Governments have a critical role to play in securing safe water, but many of them are currently struggling to repay their debts, he argued, and most of the investment will need to come from the private sector. He added that “water scarcity is a true business risk that the private sector needs to start looking at.”

Mr Thunell noted that the projected population growth, particularly in urban areas, will increase water demand and - while increasing the supply will be very profitable - increasing efficiency to reduce wasted water will be even more important.

He also noted that as scarcity rises, there is a need for smarter water use such as developing integrated water management processes - long term strategies that consider all the social, environmental and technical aspects of using water.

Professor Falkenmark said the pricing of water is a highly politicised challenge - communities often view water provision as an essential service that should be free or heavily subsidised, not priced by elected officials - but that the water community agrees “the issue is not basically to get the price right, but rather to get governance right to secure the right price.”

The professor added that the water community believes that “without cost recovery, the newly (United Nations) recognised right to water and sanitation is in fact an empty promise.”

Mr Thunell and Professor Falkenmark agreed that the large up-front capital investments necessary for most water infrastructure projects meant that the successful pricing of water and cost recovery were key aspects of good water management.

This is a scenario that would require governments to provide good regulatory frameworks. Such frameworks could pave the way for the investments that would improve water security and mitigate the water crisis by providing stable, transparent environments for investors. “Risk assessments need to be formulated by regulation to secure openness and broad awareness,” added Professor Falkenmark.

In the developing world, there is room for the private sector to help mitigate the water crisis. According to the 2nd UN World Water Development report, “the private sector’s proportion in the water and sewerage sectors is, on average, only 35 per cent, whereas in the developed world it constitutes 80 per cent of the market.”

There is also ample room for profitability.

A 2010 McKinsey Global Institute study found that in India alone, US$1.2 trillion will be needed to meet the projected infrastructure demands by 2030.

Last week’s event, which was organised by the Stockholm International Water Institute, gathered experts to explore solutions to current water problems, such as unlocking private sector funding for water management, and to seek out ways to avoid future water crises.

The week culminated with the ‘Stockholm Statement’, a call to action for governments participating in next year’s Rio+20 Summit. The statement challenges leaders to commit to setting targets for the year 2030 relating to the provision of safe drinking water, adequate sanitation, water recycling, sustainable agriculture and energy generation, and decreased water pollution.

Like this content? Join our growing community.

Your support helps to strengthen independent journalism, which is critically needed to guide business and policy development for positive impact. Unlock unlimited access to our content and members-only perks.

Most popular

Featured Events

Publish your event
leaf background pattern

Transforming Innovation for Sustainability Join the Ecosystem →