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Social services

Background

The World Bank and water

8 April 2006

As water is ubiquitous to development, so it is within the World Bank. Two network vice-presidencies have responsibilities over water (Infrastructure and Environment and Socially Sustainable Development (ESSD)). The infrastructure vice presidency houses the Energy and Water department, a Bank-wide department headed by Jamal Saghir.

  • In the period 1990 – 2005, IBRD lending for water totalled $16.7bn (7 per cent of total lending) while IDA loans totalled $7.7bn (7 per cent of total lending).
  • In FY05, water, sanitation and flood protection accounted for 10 per cent of combined IBRD-IDA lending, or approximately $2.2 billion in lending, almost a $600m increase on FY04.

In March 2000, the World Bank established the Water Resources Management Group (WRMG) to attempt to integrate water sub-sectors such as hydropower, water supply and sanitation, irrigation and drainage, and environment. The members of the WRMG are the lead individuals from these sub-sectors, lead water resource specialists from each region, water leaders from the World Bank Institute, the International Finance Corporation (IFC), the Global Environment Facility secretariat, and a representative from the legal department. The WRMG is chaired by David Grey, senior water advisor at the Bank. The staff in the secretariat of the WRMG report to the infrastructure and ESSD vice-presidencies, and are hosted by the Agriculture and Rural Development department in ESSD.

The central unit dealing with Water Supply and Sanitation (WSS) is a sub-sector of the Energy and Water department, whose work includes water supply, sanitation, and sewerage. The advisors and task managers in the sector are grouped under the WSS sector board, chaired by Jamal Saghir. Total WBG lending for WSS in the period 1990 to 2002 was $19.3 billion. After a decline in the late 90s, WSS lending has been rapidly increasing over recent years, reaching $1.8 billion in FY05, and set to grow further. The Bank is the largest external financier in this sector. Bank regional units, supported by the Energy and Water department, are responsible for developing and supervising individual projects. The Bank is also heavily involved in advisory work and policy dialogue, and supporting private sector involvement through the IFC and MIGA.

The Bank’s work on water is guided by a thematic strategy (operational policy 4.07). This is operationalised through the Water Resources Sector Strategy (WRSS), the most recent version of which was approved by the Bank board in February 2003. The most controversial elements of the WRSS are its stated desire to re-engage with “high-reward/high-risk hydraulic infrastructure” (or big dams), its emphasis on the role of the private sector and its failure to embrace the recommendations of the World Commission on Dams. Other strategies, including the Infrastructure Action Plan (July 2003), the Private Sector Development Strategy (2002), and the Urban and Local Government Strategy (2000) also provide the framework for Bank advice and lending in water resources and water services. The strategies are premised on the need to facilitate private sector provision of basic infrastructure through a spectrum of public-private partnerships.

However, the Infrastructure Action Plan introduced a more pragmatic approach and a shift to supporting reforming public services and local/domestic private enterprises. This was further worked out for the WSS sector in the Operational Guidance for World Bank Group Staff Public and Private Sector Roles in Water Supply and Sanitation Services (2004). It was also presented in 2005 at the World Bank’s water week. It follows from internal criticism in the Bank, from both the Independent Evaluation Group (IEG) and the Quality Assurance Group over the ‘irrational exuberance’ with which the private sector was pursued especially in water supply activities. The worldwide protests against privatisation were felt to have paralysed the sector and dried up investments into it, creating difficulties for Bank lending. At the recently concluded World Water Forum in Mexico, the same message was communicated by the infrastructure vice-president, Katherine Sierra.

Following up the WRSS at the country level are new Country Water Resources Assistance Strategies (CWRASs). CWRASs are meant to link water activities to Bank national lending strategies (Country Assistance Strategies, or CASs) and national development plans. They describe priority lending and non-lending activities in water resource management in a country, and in a break from the technocratic focus of the past, are to focus on the “political economy of change in water resources management”. Only a few countries in each region – such as Brazil, Bangladesh, the Philippines, Ethiopia and Iraq – have been selected for CWRAS development, with priority given to countries “where water problems are serious and where there is a demand for Bank engagement”.

Region Countries selected for CWRAS development
Latin America and the Caribbean Brazil, Dominican Republic, Honduras, Peru
South Asia Bangladesh, India, Pakistan
East Asia and Pacific Cambodia, China, Philippines, Mekong
Africa Ethiopia, Kenya, Tanzania
Middle East and North Africa Iran, Iraq, Yemen
Europe and Central Asia Azerbaijan

Other World Bank activities in water include managing sectoral trust funds, participating in a myriad of regional and international partnerships, and providing training. The WRMG, WSS and the World Bank Institute (WBI) cooperate to develop water resources management and water services learning and training programmes – seminars at national, regional and international level involving central and local government officials, water utility managers, private sector providers, the media and civil society.

Updated 11 April 2006