Asia s Water Sector: Challenges and Opportunities

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1 PSLO Mission on Water and Sanitation 12 June 2013 Asia s Water Sector: Challenges and Opportunities Samuel Tumiwa Deputy Regional Director ADB s North American Representative Office

2 Water in Asia Today Drinking Water - About half a billion need access to safe drinking water Sanitation - Approximately 1.7 billion people need improved sanitation Food and Environment - Demands for water are rising, pollution remains a major challenge Vulnerability - Increasing at national, city, river basin, and community levels, made worse by climate change

3 Issues We Face in Urban Areas Water utilities generally underperforming (less than 24 hours service, high non-revenue water, overstaffing, etc.) Financial management capacity still weak - creditworthiness lacking Tariff still not within cost-recovery level Autonomy and accountability of utilities leave much to be desired Sanitation and wastewater management still behind water supply

4 Water Investments Needed Yesterday USD8 billion annually needed to meet MDG targets over the next decade for safe drinking water and sanitation alone Additional investments needed for irrigation, river basin and flood management, and wastewater treatment

5 ADB s Response: Water Financing Program Rural water rural water supply and sanitation; irrigation and drainage Urban water urban water supply, sanitation and wastewater management Basin water water resources development and management, flood management, wetlands and watershed protection, hydropower Rural Water Urban Water Basin Water

6 ADB s Water Financing Program Complete Package of Assistance: Investments ($2.0 - $2.5 billion annually) Reforms (policy, legislation, regulation) Capacity development (sector institutions)

7 ADB s Water Operational Plan Guiding the implementation of the Water Financing Program with the following thrusts: Increased water use efficiencies Expanded wastewater management Embedded integrated water resources management Expanded knowledge and capacity development Enhanced partnerships with private sector

8 ADB s Water Investments: (By Sector) Investment Area Water Supply, Sanitation and Wastewater Management Approved Lending (in USD Billion) 8.86 Irrigation and Drainage 2.14 Flood Management 1.01 Water Resources Management, Wetlands and Watershed Protection 1.31 Hydropower Generation 2.16 Total 15.48

9 ADB s Water Investments: (By Region) ADB Region Approved Lending (in USD Billion) Central and West Asia 3.78 East Asia 2.73 Pacific 0.07 South Asia 4.56 Southeast Asia 3.52 Private Sector Operations 0.82 Total 15.48

10 Pipeline: Water Supply and Sanitation Region Investment Area Amount (in Million USD) Central and West Asia Rural Water Urban Water East Asia Urban Water Pacific Urban Water South Asia Rural Water Urban Water , Southeast Asia Rural Water Urban Water

11 Sample Water Supply and Sanitation Projects

12 Viet Nam: Water Sector Investment Program $1.0 billion loan (multitranche financing facility) Targeting to benefit about 6 million people Supporting capital investments in water companies Cofinancing the government s non-revenue water management program Providing longer-term support for institutional reform

13 Armenia: Water Supply and Sanitation Sector Project $36 million loan Targeting 576,000 people Rehabilitation and improvement of water systems (18 sub-projects) Improvement of operational efficiency of water service providers

14 Kiribati: South Tarawa Sanitation Improvement Sector Project $22 million loan Targeting 26,000 people Comprehensive and sustained community awareness, education, and participation Improvement of sanitation infrastructure Capacity building

15 Trends in Water : A Private Sector Perspective Growing strength of local players and shift in dynamics Growth of regional players - Rise of local companies in China, India, Philippines - Retreat of traditional players Shift in type of public private partnerships - Full concessions are less common - More business-to-business arrangements - Focus on specific management contracts

16 Trends in Water : A Private Sector Perspective Challenges are growing for overseas companies: Growing demand for expertise - Regional players are looking for value addition - Adaptation of advanced technologies and equipment will be key Shift in strategy is necessary - Alliances with local partners - Focus on the marketing story: why you?

17 Maximizing Technological Advancements Not the technology per se but the overall business model ADB does not promote specific technology; it presents menu of options to allow informed decision by government clients Technology providers may work with design engineers/consultants

18 Expertise Required Wastewater management Urban flood management Water and climate change Water governance and utility reforms

19 Thank you! For more information about ADB s water operations, please visit our water website