“If I had an hour to solve a problem I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.”
(Albert Einstein).
The world cheered when the 2030 Agenda not only adopted a Sustainable Development Goal (SDG) on water: SDG 6 (“ensure availability and sustainable management of water and sanitation for all”) but also recognized the necessity to approach the water crisis in an integrated, multi-sectoral, multi-stakeholder and transboundary manner, as embedded in a specific target for the implementation of integrated water resources management (IWRM, SDG 6.5).
Now we have to deliver. What will it take ?
$4 trillion … or a mere $36 per person per year: “Water crises” is among the top-ranked global risks for the past several years in the World Economic Forum Global Risks Report. Governments across the globe are very aware of it, with water coming as the most-cited priority sector in the adaptation component of Nationally Determined Contributions (NDCs) to the Paris agreement. 80% of natural disasters are water related (“If climate change is a shark, water is its teeth”).
Translating this into financing sustained, integrated water action is easier said than done. Why? Not so much because of a lack of funds – green bonds, just to take this green financing instrument, will reach an estimate $250 billion by the end of 2019, up from $2.6 billion in 2012… even with a 100x growth, green bonds still represent less than 0.25% of the $100+ trillion bonds market!
Part of the problem is that water is everywhere – in migrations, jobs, poverty, climate, energy, food, health, disaster relief, in peace. Water is a social good. Making a profitable, business case for water has always been difficult because it is seen as a good that shouldn’t be overpriced. Therefore our ‘5 minutes of solutions’ to the water crisis, should concentrate on strengthening the enabling environment, rather than polarising our attention on the supply of money (blue funds, green funds, social impact funds or otherwise). And, pre-requesite to strengthening this enabling environment, is ensuring focusing our attention on the way we manage and govern water resources. Water problems are usually problems of management or governance. Manage water poorly and you will have an obstacle to development. Manage it well – with cross-sector cooperation, informed people, reliable information, competent institutions, fair decision-making, benefit-sharing, let alone technical expertise – and you will achieve peace and prosperity.
Another problem is that the value of water is not necessarily well understood – if we think of it in financial, economic, social or environmental terms. Better understanding and evaluating the multiple dimensions underpinning the value of water (social, economic, environmecultural, spiritual…) will help strengthen the business case and its prioritizing in investments. So, financing the enabling environment and all that makes good water management, along with a sound multi-stakeholder dialogue for better valuing and framing the business case for water, are a good insurance policy to make sure financing water action delivers sustainable, effective and inclusive returns for our investment.
The 4 “I”s for water-secure investments: Inclusion, Institutions, Information, Infrastructures
Whenever the question of financing is brought up, keeping in mind only a fraction of the $4 trillion will come from public funding and that financial institutions and private sector investors are called on the table, we hear the notion of ‘bankability’ of investments. There is no dispute that unlocking trillions will require much broader access to bankable projects at a country or water basin level. Without the bankability aspect, the creditworthiness of water service providers will be unattainable and limit their ability to access finance. But let us not forget the 2030 Agenda for Sustainable Development aims to leave no one behind and calls for an “all-of-society engagement and partnership” to bring about the large scale transformational change needed to fix global challenges. How do vulnerable groups or the poorest of the poor, stand to benefit from ‘bankable projects’, in strict financial terms? It is imperative to widen the adoption of a gender- socially, ecosystems- sensitive definition of what is considered a bankable investment.
If we can take comfort from the examples set by leading financing actors (Canada’s explicit labelling of its “New Feminist International Development Policy”, World Bank’s new Environmental and Social Framework or the Green Climate Fund’s Climate Change and Gender toolkit), greater focus on the ‘Inclusion’ dimension of financing a water-secure world is needed, while two other “I” – Institutions, Information – should complement the more generic “I” of Infrastructures Investments.
Solving water problems confronts us with a responsibility to invite everyone to the table: government, business, civil society, women, vulnerable or marginalized groups, as well as all sectors (e.g. agriculture, energy, tourism, health, construction, etc.). Business as usual – a fragmented approach with each sector acting unilaterally – means we would need three planets worth of water! A water-secure world needs an integrated, multi-stakeholder, inclusive approach and the connected work of all groups and sectors, the kind of which is meant under the last of the 17 goals (SDG 17 – revitalizing the global partnership). The kind of integrated approach which the UAE government is calling for through its 2036 Water Security Strategy, but with an equal emphasis on inclusion, participatory processes to create the required all-of-society ownership of its most vital resource.
Shifting from an economic growth to a sustainable, inclusive growth model and closing the financing gap are the imperatives of our time. There are sizeable blue, green funds out there, many supporting tools, mechanisms, organizations, all dedicated to ensuring we live up to the Agenda 2030 and the trillions needed to finance it. But, as we go deeper into the water crisis, there is urgency to break silos and a still prevailing fragmented approach to water, so that we can, together, better value water and implement the solutions at the scale needed and make the most of our “5 minutes of solutions” to solve the biggest challenge of our time.