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Water articles are written by ADB staff and external contributors on various water issues, reforms, and good practices.

No Rain Checks for Water Financing


December 2006

Five countries identified opportunities to double their investments in water before a typhoon could interrupt finance talks during the Conference on ADBs Water Financing Program (WFP) 2006-2010. These WFP countries seriousness of purpose during the conference demonstrated their strong commitment in meeting the Water Targets of the Millennium Development Goals (MDGs). FINANCING WATER ON THE DOUBLE The looming bad weather on Manilas skyline in the last week of September this year seemed a Shakespearean witches brew. But something else was brewing inside Asian Development Bank (ADB) Headquarters that week. Delegations from India, Indonesia, Pakistan, the Philippines, and Viet Nam that included a strategic mix of high-level national and local government officials from different ministries78 in allwere meeting with ADB water operations staff to discuss the barriers and opportunities facing their water sectors. The country-based dialogues were the centerpiece of the conference dubbed Doubling Water Financing and Results. The conference started action on ADBs new Water Financing Program (WFP), which aims to double ADBs water investments in the region between 2006 and 2010. The country teams worked for two days to answer the conferences central question, How can ADB help address your countrys water investment needs? The five countries were specifically invited to the conference because they represent a great proportion of the regions need for better water service delivery and resource management, ADB Water Committee Chair Arjun Thapan said. RAIN CHECKS NOT ACCEPTED The conference was part of a longer chain of efforts to achieve the MDG Water Targets aimed at improving access to safe drinking water and sanitation for half of the worlds poor by 2015. As the first major initiative under the WFP, the conference was the necessary first step to get water projects underway. ADBs new financial products and servicesthe Multitranche Financing Facility (MFF), subsovereign lending for municipalities and state-owned enterprises, local currency lending for the private and public sectors, among otherswere introduced to get a clearer view on how countries can make the most out of an investment partnership with ADB.

Participants took a special interest in the MFF, particularly the delegations from India, Indonesia, and Viet Nam, as it acts as a credit line that provides larger amounts in slices to finance cluster projects. These three WFP countries have requested in-country dialogues similar to those conducted at the conference to pursue investment possibilities using the MFF. Hun Kim, Director of ADBs South Asia Urban Development Division, said, This is the first time that we had the chance to sit down and seriously talk with DMC officials from all levels of government national, state, and local. By the end of the conference, typhoon Milenyoone of the strongest to hit the Philippines in recent yearsstarted ravaging Manilas streets. Most delegates flights were delayed by at least a day, but they werent returning home empty-handed. SOLVING PROBLEMS, FINDING OPPORTUNITIES As an outcome of the conference, delegates produced country reports on their water sector barriers and opportunities, which were presented at the last plenary session. India identified funding requirements for water supply and sanitation improvements in cities not covered by the Jawarharlal Nehru National Urban Renewal Mission, which ADB supports. The country also needs support in developing a complete irrigation project for 15 million hectares of agricultural land that is currently underutilized. Indonesia zeroed in on the pollution problem of the Citarum river basin, which supplies around 80% of Jakartas water. Representatives from the country came prepared with a detailed analysis of water-sector barriers and, with the ADB team, discussed their vision and investment targets. Pakistan underscored the necessity of bringing integrated water resources management to its river basinsthe Ravi, Tochi, Naigaj, and the Balochistan aquifer. Construction of major multi-purpose dams and development of flood management strategies are also needed to service the countrys rural areas. The Philippines showed a great interest in sub-sovereign lending to local governments as a way of helping expand access to water supply and sanitation outside Metro Manila. More money is also needed to bring integrated water resources management plans to the Agusan River basin in Mindanao.

Viet Nam listed hydropower, irrigation, and urban water supply and sanitation as its main concerns. Also high on the countrys agenda is reducing non-revenue water in Hanoi, and large infrastructure projects along the Red River and the Mekong Delta. Senior officials from the Peoples Republic of China were also invited but were not able to attend. Discussions are, however, ongoing regarding the conduct of a future in-country dialogue. RELATED LINKS Water Financing Program 2006-2010 Conference Report: Doubling Water Financing and Results Conference on ADB's Water Financing Program 2006-2010 Doubling Investments in Five Years: Candid Answers to WFP Questions (December 2006) Three Streams to a Thriving Future: Rural Water, Urban Water, Basin Water (December 2006) Water Makes WFP Countries Grow (December 2006)

_______________________________ *This article was first published online at ADB's Water for All website in December 2006: http://www.adb.org/water/articles/no-rain.asp.