Welcome Address at Side event on Impactful Investments into Water-Resilient Infrastructure: Inputs to the 3rd APWS

Delivered at Side event on Impactful Investments into Water-Resilient Infrastructure: Inputs to the 3rd APWS, Bangkok, Thailand

Ladies and Gentlemen,
Distinguished delegates

I would like to thank the Japan Water Agency for its collaboration with ESCAP as well as the regional Network of River Basin Associations and the Asia-Pacific Water Forum for organizing this side event.

ESCAP’s latest analytical products, coupled with the lessons learnt from the regional projects, show that our region is experiencing an increased pressure on water resources. Demand is rising in all sectors, particularly in agriculture, and the unsustainable use of water and disposal of waste water is a concern in many countries of the region.

Among the key factors that prevent optimal investment in water-related SDGs include inadequate pricing and incentives. This, coupled with uncoordinated policy responses to competing sectoral water demands, can lead to poor management of scarce water resources. In addition, a lack of incentives for pro-poor public-private partnerships and the absence of community and private sector involvement in developing of water and sanitation services mean that innovative approaches to financing water and sanitation infrastructure are not realized.

The economic, social and environmental returns on investments on water related SDGs are considerable. Yet at the same time, the Asia-Pacific region is only meeting ten percent of its required water infrastructure needs. We have been talking about the need to increase investments in water and sanitation in the region for decades. But, over the last few years, the international aid for water and sanitation has fallen. Privatization and commercialization options do exist but have not been tapped effectively as water boards and other public-sector providers often enjoy monopolies and are riddled with inefficiencies. Lending by banks have been rising, though not enough to offset the trends just mentioned. Furthermore, most municipal or water agencies are financially weak and as such recourse to market lending is limited.

The region needs to bring about a step change in its ability to attract water and sanitation investments to ensure impact is realized in all three dimensions of sustainable development.

First of all, water and sanitation-related SDGs cannot be attained solely through mega projects and by the search for mega infrastructural financing. We need to empower the leadership of regional local governments to develop policies and norms for financial frameworks and decentralized financing systems. For example, policies enabling decentralized waste water management practices in Thailand, Indonesia, Vietnam and the Waste Management and Public Cleaning Law in Japan, mandate local governments and municipalities to participate in the management of water and sanitation services. These financing schemes help to diversify sources of income and should in turn enable open, but well-regulated local and regional market opportunities for reliable, affordable water and sanitation services.

Second, by creating both smart budget appraisals1 and the efficient delivery of water and sanitation services, we can avoid inefficiencies and misallocations in the management of funds, especially in water and sanitation projects of municipal and local governments, which are vulnerable to financial leakages. Better public expenditure management across water boards is critical as the revenues collected are being misappropriated or misallocated. As a practical monitoring measure, governments could encourage the use of smart phone applications, and further implement budget and expenditure transparency for water and sanitation at the local level. Proportions of specific service taxes collected for different purposes at the central level should be allocated for water and sanitation provision in the local governments with clear programmes and implementation codes.

Third, we need to attract impactful investments to enhance the resilience of infrastructure to water-hazards,2 by showing the multiple benefits to social and environmental security and the returns on investments that are achievable. In this context, the smart city concept in India and the Republic of Korea is being developed to promote vibrant, liveable and environmentally efficient cities with optimal use of resources, leading to enhanced economic development.

Fourth, provision of clean drinking water is critical to prevent water borne diseases whose incidence has grown and burden the weak health system and household budget.

To conclude, the leadership of governments and municipalities in framing policies and in attracting increasing investment for water and sanitation infrastructure is crucial. To follow up efficiently we need to strengthen integrated water resource management processes and promote inter-disciplinary consultations. ESCAP is strengthening its support to member States with new knowledge platforms aimed at delivering the rapid regional response to achieve the 2030 Agenda for Sustainable Development. We look forward to working with you all in these efforts.

I thank you.