Tuesday, 06 October 2015

Financing and SDG 6: What was said at the 3rd Global WOPs Congress

The Sustainable Development Goals, were adopted by the United Nations General Assembly last week, setting the course for the global development agenda until 2030.


Solidarity, partnership and action are core principles of the framework, while appropriate finance and sufficient capacity are key enabling factors to reach these goals. In this context, the 3rd Global WOP Congress featured two sessions to discuss existing barriers and opportunities to financing the extension and maintenance of water and sanitation services worldwide. A range of financial stakeholders were present to introduce, suggest and debate financing modalities toward the achievement of the SDG 6. The Islamic Development Bank introduced its “Reverse Linkage” concept, which supports capacity development through tripartite South-South cooperation. The Dutch Directorate-General for International Cooperation (DGIS) presented on its Water Financing Facility, a mechanism to mobilize domestic capital markets, making blended funding available for water utilities while reducing risks for investors. The Millennium Challenge Corporation insisted on the importance of operators’ creditworthiness for accessing local financial markets.

Throughout the session, the many ways that WOPs can help utilities to secure financial resources were also highlighted. WOPs can either be an instrument to build donor trust and confidence to unleash capital, or act as a financial leverage tool to enable operators to mobilize funding. A WOP between Water Authority of Fiji and Water Hunter Australia showcased at the Congress, enabled the recipient utility to slash its energy bills and to access capital funding by improving its financial strategic planning.

As the global financial landscape is changing, all potential sources of funds have to be taken into consideration. Emerging donors from the global south, traditional funders, decentralized cooperation, domestic markets, both public and private, are potential pools of funds. Discussions acknowledged the need to combine available financial resources through adapted mechanisms and catalyze all efforts toward a common goal, crystallized in the SDGs 6. The participants recalled the obligation of scaling-up sanitation through appropriate business models, while recognizing the public value of it and the need for further financial public support. Governments and local authorities have a responsibility to mobilize funding to reach universal water and sanitation access for all.

Finally, participants continued to underline the need for water and sanitation operators to be technically and financially efficient, while keeping in sight the final objective to provide universal quality services, with a special attention to the lower-income users. Water and sanitation operators are at the forefront of the current drinking water, sanitation and hygiene challenges. The task is gigantic, and the forces of all stakeholders must be channeled toward common targets. A balance between financial sustainability and socio-environmental acceptability may be an approach forward.

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