Catalog

Improving the Flow
ADB Review [ December 2006 - January 2007 ]

Is ADB delivering on its Water Policy? Yes and no, says an external review panel

By Melissa Howell Alipalo
Communications Specialist and Writer for RSID’s Cooperation Fund for the Water Sector

REVIEW PANEL AT WORK (From left) Wilson Siahan, Erna Witoelar, Pradeep Singh, Li Yuanyuan, Ravi Narayanan, Annelie Hutach, Gilbert Llanto, K.E. Seetharam, and Wouter Lincklaen Arriens

Is the Asian Development Bank's (ADB's) Water Policy half full or half empty? An Independent Review Panel considered this question during its evaluation of ADB's implementation of the Water for All Policy, approved in 2001.

The Panel concluded that the Policy's implementation was both half full and half empty, acknowledging successful elements, but also highlighting areas that need improvement.

"ADB must think ‘outside the box' and conduct ‘business unusual' to improve conditions in Asia's water sector and to meet the Millennium Development Goals (MDGs) by 2015," says Erna Witoelar, the Panel Chair. Ms. Witoelar is also the United Nations Special Ambassador for MDGs in Asia and the Pacific, and the former Indonesian Minister of Human Settlements and Regional Development.

Released in May this year in Hyderabad, India, during ADB's Annual Meeting, the review included five main recommendations to improve ADB's water sector operations and investments. These are to:

• increase ADB's investments and develop its staff capacity;
• develop long-term partnerships with stakeholders in developing member countries (DMCs), and among donors;
• focus the implementation of integrated water resource management (IWRM) on stakeholder needs and ownership;
• promote "business unusual" through innovations to increase access, affordability, efficiency, and cost effectiveness; and
• to improve ADB's processes to ensure effective policy implementation.

The Panel found that ADB's lending levels and staff capacity had not kept pace with the increasing needs of the water sector in DMCs. It suggested that ADB double its investments in the water sector over the next 5 years and sustain those levels with balanced investments in infrastructure, capacity building, and reforms. It also suggested that ADB develop a long-term strategic plan for recruiting, retaining, and developing its water sector staff.

Need to Build Broad-based Support

Recommending that ADB develop longterm partnerships with stakeholders in DMCs and among donors, the Panel found that ADB's impact in the region's water sector had been weakened by its "project-byproject" approach. It suggested that ADB focus on building broad-based support for the Water Policy's principles through longterm programs rather than project-centric regional and in-country programs. It also suggested that ADB take the lead among donors in the sector to harmonize efforts.

This broad-based approach to support should give special attention to implementing IWRM as the panel found institutions in DMCs to be severely constrained in this area, needing training and help with planning and implementation. The Panel suggested that women, civil society, the poor, and other marginalized groups whose needs must be considered be given greater opportunities to be more involved in the decision-making process. Such involvement would increase the feeling of ownership among these groups and this would result in more effective implementation. The Panel also particularly cited support for IWRM in river basins, the foundation of a water sector.

On the sector's services side, the Panel found that ADB needs to clarify its stand on water pricing and charges. It suggested that ADB remove ambiguities in the Water Policy, specifically on issues of subsidies, cross-subsidies, and differential pricing.

The Panel also recommended that ADB work harder at expediting service delivery to the poor, which would help countries meet their relative MDG targets. This would require alternative approaches to the typical, large-scale infrastructure projects that sometimes span up to 10 years.

There was also a need, the Panel noted, to change ADB's corporate culture so that the principles of the Water Policy drive the organization's day-to-day operations, affecting the size, scope, direction, and character of ADB's water-sector portfolio. To do this, the Panel said ADB's water operations staff needed tools and incentives to absorb genuinely the Water Policy's principles into their own work and throughout the project cycle.

One way of addressing the gap between policy and practice inside ADB would be to create an operational strategy and plan linked to staff 's 3-year rolling work plans. These strategies and plans, the Panel suggested, should be punctuated with quantifiable targets and implemented throughout its business processes.

Doubling Investments in Water

In response to the findings, ADB says it supports the "general thrust" of the Panel's report and recommendations.

"The review has provided ADB with important feedback on how the Water Policy is being implemented," says Bindu Lohani, Director General of ADB's Regional and Sustainable Development Department. He says ADB accepts the challenges outlined by the Panel, and is committed to increasing investments in the water sector—to more than $2 billion a year—catalyzing reforms, and supporting capacity development.

As such, ADB's new Water Financing Program will double ADB investments in the water sector over the next 5 years and provide additional technical assistance for DMC water sector reform and capacity building.

ADB's Water Committee is expected to work with operations staff in building an action plan based on the Panel's recommendations.

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