It's Time to Reap the Financial Benefits of Water and Sanitation

Chegou a Hora de Colher os Benefícios Financeiros da Água e Saneamento

To achieve clean water and sanitation for all by 2030, Africa will need almost triple your investments and mobilize an additional 30 billion dollars annually. This may seem like a considerable sum, but it amounts to less than two percent of the continent's current Gross Domestic Product (GDP). What's more, it's far less than the estimated 170 billion dollars lost annually due to water shortages, poor sanitation and disease in sub-Saharan Africa.

Historically, finance ministers have been apathetic about allocating funds for water and sanitation, because these services are seen as a burden on public budgets. It has been said that providing access is "too expensive" and "less urgent than tackling climate change, a pandemic or a humanitarian emergency."

Unfortunately, many decision-makers are often tempted to pursue one goal to the exclusion of others. We can't achieve climate goals if countries face water shortages. We can't improve health when more children under five die from contaminated water than from bullets in war.

But there are ways to pay for water and sanitation that can help leaders achieve their development goals. So how do we triple the investment?

First, we need to start with political prioritization. Who increases or decreases budgets? Who decides on ambitious targets to increase access to water and sanitation? These are political decisions, and I believe that when political will is mobilized to prioritize water and sanitation, funding follows.

For example, earlier this year, nine African governments announced that they are working on Presidential Pacts on Water and Sanitation. These initiatives include increases in budget allocations, innovative sources of funding and plans to build new infrastructure. We hope that other countries on the continent - and beyond - will follow suit.

Secondly, we need to convince finance ministers that water and sanitation generate high economic and financial returns. Every dollar invested in climate-resilient water and sanitation in Africa returns at least 7 dollars.

Next, governments and their partners can make more effective use of the financial resources they already have, including domestic water tariffs, taxes and micro and macro loans.

For example, government officials may think they are making water and sanitation more affordable for poorer households by instituting low tariffs for all customers. However, this often creates a lack of revenue to cover the basic operating costs of water companies, which then need additional financial support from the government to survive. This can also unintentionally subsidize wealthier households and businesses that can afford to pay more.

Alternatively, Burkina Faso has instituted higher tariffs for commerce and industry to offset the costs of providing domestic connections and public sources within poorer communities.

Earmarked tax money is yet another way to pay for water and sanitation. Europe and North America have historically used property taxes to finance capital investments in these services, while South Korea has used money from taxes on alcohol sales.

The basis of a healthy investment climate also requires stronger regulation of the sector: well-documented standards with performance targets, clear lines of responsibility, incentives and penalties. For example, Kenya has joined forces with the World Bank to assess the solvency of its water companies in order to attract domestic and international funding.

Finally, the international community needs to build relationships with finance ministers, bringing the right examples of policies that can achieve development goals. That's the aim of our next African finance ministerswhich will be held on 31 October 2023, organized by Sanitation and Water for All, UNICEF and the Council of African Ministers for Water.

This is a unique opportunity for our sector to position itself not as a drain on national resources, but as an investment in human and economic development. In addition, many finance ministers are already taking positive steps to finance water and sanitation in their countries, and we are excited for them to share their experience.

There are few opportunities where a single investment can improve public health and quality of life, stimulate economic growth and reduce inequalities, but investing in water does all this and more.

It's time to reap the benefits.


By Catarina de Albuquerque, CEO of the Global Sanitation and Water for All partnership, based at UNICEF, and the first United Nations Special Rapporteur on the Human Right to Safe Drinking Water and Sanitation.

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