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ADB Reviews Plans for More Efficient Use of Asia's Dwindling Freshwater Supplies

News Release | 12 October 2010

MANILA, PHILIPPINES - The Asian Development Bank (ADB) has developed a draft framework for its water operations that calls for sweeping efficiency improvements and greater public-private sector partnerships to address the water crisis in Asia and the Pacific.

The Draft Water Operational Framework for 2011-2020 was discussed today at the "Water: Crisis and Choices - ADB and Partners Conference 2010" at ADB headquarters in Manila. The event has drawn together over 600 water professionals from government, industry, think tanks and non-profit organizations from around the world to examine water challenges and the solutions needed to overcome them.

Urbanization, industrialization, pollution, and competing demands for water for energy and food production have left water stocks in many Asian countries in a critical state. The onset of climate change, with more extreme weather events, melting glaciers, and saline intrusion poses a new and serious threat. By 2030, estimates suggest there will be a shortfall of 40% between water supplies and demand in the region, with food production under threat and rising cross-border tensions over shared water resources in river basins.

While stocks dwindle, water use in Asia is marked by inefficiencies and waste, with leakage in urban water supply systems alone amounting to the loss of as much as 29 billion cubic meters a year, worth around $9 billion. Irrigated agriculture, which draws most of Asia's freshwater, is also notoriously inefficient with efficiency improvements averaging 1 per cent annually since 1990. Providing water below costs, or giving it away at no cost, coupled with the lack of integrated planning for water use, weak governance, and low levels of investment from the private sector have also hampered management of the resource.

"Asia has been an inefficient water user, with a constant bias towards growing supply rather than managing demand. ADB's draft Water Operational Framework suggests a new paradigm for its developing member countries focused on efficiency gains, business-like approaches, and effective partnerships to make better use of scarce resources," said Arjun Thapan, ADB's Special Senior Advisor (Infrastructure and Water), and the convener of the water conference.

The framework - which is a result of extensive consultations with stakeholders - provides a design for ADB's future work in the water area, with the focus on using water more efficiently. Operations will focus on areas such as advanced water-efficient irrigation practices, reducing losses in urban water supply systems, and the development and adoption of technologies that offer cost-effective ways to treat and reuse wastewater. Greater attention will be paid to develop a corporate outlook in the business of water services, currently dominated by governments, so as to drive efficiency and attract private investments and expertise.

"Increased investments from the private sector, especially in managing and delivering water services, and in using technology and innovation to reduce our water footprint will be critical to securing a sustainable water supply," said Mr. Thapan. "Governments do not have the resources to go to scale and effective partnerships with the private sector will be a sine qua non".

The framework recommends a study to examine the outlook for available sources of freshwater in the region over the next 20 years, as well as forecasting the impact of water use policies and practices on food, energy production, industrial growth and domestic use, factoring in climate change uncertainties. It will consider potential technology solutions to improve efficiency, and business models to encourage private sector investment.

Following the regional study and water assessments for selected countries, ADB will seek to mobilize fresh resources for the Water Financing Partnership Facility, a mechanism established in 2006 to fund investments in rural and urban water services and river basin management. It will also review the status and quality of its water partnerships to maximize synergies and knowledge development, and will explore the deployment of specialist water teams in-country to provide real-time quality support.