Financing Investment in Water Security

Financing Investment in Water Security

Recent Developments and Perspectives

1st Edition - May 16, 2022

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  • Editors: Xavier Leflaive, Kathleen Dominique, Guy Alerts
  • Paperback ISBN: 9780128228470
  • eBook ISBN: 9780128228487

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Investing in Water and Growth: Recent Developments and Perspectives addresses this conundrum in a cohesive and practical way. It is a one-stop shop for understanding why the financing of water-related expenditures matters, what is at stake, and the options available to ensure water-related investment needs are properly financed in ways that generate benefits for communities and contribute to sustainable growth. The book combines the perspectives of policymakers, economists and financiers in a unique, multidimensional and multidisciplinary approach. The book is structured into four distinct parts that target a specific set of questions and content development. Each section of the book has a multidisciplinary approach that provides a robust overview of key issues. The book combines different types of knowledge – from theory to practice, providing a full view of the topics discussed.

Key Features

  • Includes numerous examples and real-world case studies
  • Discusses the concepts of planning, the planning process, integrated planning and public involvement
  • Synthesizes key evidence and arguments for investing in water security and sustainable growth


Environmental policy, development, water, ecosystems, adaptation to climate change, risks, etc.

Table of Contents

  • Cover Image
  • Title Page
  • Copyright
  • Table of Contents
  • Contributors
  • General introduction
  • A new conversation on financing water
  • A new context for the discourse
  • Ambition and scope of the book
  • Cross-cutting messages and ways forward
  • References
  • Part I Investing in water and growth: A global perspective
  • Chapter 1 If not now, when? Converging needs for water security, systemic change, and finance and investment
  • 1.1 Water in the economy: multiple objectives and competing needs
  • 1.2 Priorities: evolving global and national water agendas
  • 1.3 Foundations: the investment case for water
  • 1.4 Transitions: failing assumptions of plenty
  • 1.5 New imperatives: adapting to climate change and the new systemic mission
  • 1.6 Way forward: toward a new financing and investment agenda for water
  • References
  • Chapter 2 Water, physically connected yet institutionally fragmented—Investing in its strategies, asset classes, and organizations
  • 2.1 Introduction
  • 2.2 Water and land: Investing productively, recognizing limits, seeking efficiencies
  • 2.3 Water-related assets, operational practices, and institutional architectures
  • 2.4 Value, cost, and price—sometimes aligned, often not
  • 2.5 Conclusions
  • References
  • Chapter 3 Financial structuring: key tool for water sector investments
  • 3.1 Introduction
  • 3.2 Financial structuring
  • 3.3 The project cycle
  • 3.4 Comparison with other sectors
  • 3.5 Conclusions
  • References
  • Chapter 4 Financing instruments and the ecology of the financial system
  • 4.1 Introduction
  • 4.2 The ecology of the financial system: macroaspects
  • 4.3 The ecology of the financial system: microaspects
  • 4.4 Constraints on the financing of water investments in advanced economies
  • 4.5 Constraints on the financing of water investments in emerging economies
  • 4.6 Perspectives offered by the development of sustainable finance
  • 4.7 Conclusions
  • References
  • Chapter 5 Critical disconnections between donor and domestic realities
  • 5.1 Introduction
  • 5.2 Project definition
  • 5.3 Financing considerations
  • 5.4 Domestic issues
  • 5.5 Conclusions
  • Reference
  • Part II Investment Needs and Financing Challenges
  • Chapter 6 Characterizing financing needs and financing capacities in different regions: a global perspective on water-related financing flows and drivers for investment needs
  • 6.1 Introduction
  • 6.2 The need for water supply and sanitation assets and trends in investment
  • 6.3 Current investment and financing flows for WASH
  • 6.4 Drivers for and scale of future investment needs
  • 6.5 Conclusions
  • References
  • Chapter 7 SDG 6 global financing needs and capacities to ensure access to water and sanitation for all
  • 7.1 Introduction
  • 7.2 Studies assessing financing needs to cover the capital costs of achieving SDG6
  • 7.3 Methodologies used by costing studies
  • 7.4 Global spending needs
  • 7.5 Regional spending needs
  • 7.6 Estimated financing gaps
  • 7.7 Affordability
  • 7.8 Conclusions
  • References
  • Chapter 8 Financing water for growth and development in Africa
  • 8.1 Africa's water finance challenge
  • 8.2 Transforming Africa's water finance and investment outlook
  • 8.3 Opportunities to narrow the finance gap
  • References
  • Chapter 9 Financing water security in Asia
  • 9.1 Background and rationale
  • 9.2 Financing water security in the Asia Pacific region. Needs, capacities, and gaps
  • 9.3 Market-based mechanisms and valuation tools to finance water-related investments in South-East Asia and China
  • 9.4 Conclusions
  • References
  • Chapter 10 Financing mechanisms for water treatment projects in China
  • 10.1 Introduction
  • 10.2 Background on China water situation and relevant government entities
  • 10.3 Various types of water projects
  • 10.4 Development of sewage treatment in China
  • 10.5 Funding for projects
  • 10.6 Water conservancy projects using build-transfer modes
  • 10.7 Emergence of public–private partnerships
  • 10.8 Rooting out low-quality projects
  • 10.9 Equity market for funding water projects
  • 10.10 REITs to fund infrastructure projects
  • Chapter 11 Financing needs and capacities for the water supply and sanitation sector in the European Union
  • 11.1 Introduction
  • 11.2 The EU water sector—contextualizing investments in the EU
  • 11.3 Assessing investment needs in the EU—methodological and data issues
  • 11.4 Financing water supply and sanitation in Europe—the state of play
  • 11.5 Financing water supply and sanitation in Europe—Projections to 2030
  • 11.6 Options to close the financing gap for water supply and sanitation in Europe
  • 11.7 Looking ahead: renewed ambition for water supply and sanitation in Europe
  • 11.8 Conclusions
  • References
  • Part III Financing models in practice: Case studies
  • Chapter 12 Introduction to the water financing landscape: Select proven and emerging approaches
  • 12.1 The water financing landscape: a brief introduction
  • 12.2 Select proven models and emerging approaches: insights on prerequisites for replication
  • 12.3 Reflections on future developments: a role for decision-ready data to inform financing
  • References
  • Chapter 13 Water infrastructure financing: the experience of the United States
  • 13.1 Introduction
  • 13.2 Federal policy support for local water infrastructure improvements
  • 13.3 State revolving fund models: capabilities and designs
  • 13.4 Water Infrastructure Finance Innovation Act (“WIFIA”) National Direct Lending Model
  • 13.5 Context for the successful adoption of US water finance models
  • 13.6 International context
  • 13.7 A US water model adoption checklist
  • References
  • Chapter 14 Mobilizing private capital for large-scale ecological restoration and conservation: Insights from the US Experience
  • 14.1 Introduction
  • 14.2 The history of mitigation banking policy development
  • 14.3 What is an ecological credit?
  • 14.4 How credits incentivize investment: alignment of interests
  • 14.5 Case studies
  • 14.6 Lessons learned
  • References
  • Chapter 15 Tapping local capital markets for water and sanitation: the case of the Kenya Pooled Water Fund
  • 15.1 Introduction
  • 15.2 Background
  • 15.3 KPWF structure
  • 15.4 Challenges to establishing a revenue-based long-tenor debt financing facility in Kenya
  • 15.5 WFF/KPWF business approach to successfully accessing private-sector financing
  • 15.6 KPWF's comparative advantage
  • 15.7 Further development of local capital market financing
  • Annex Detailed steps in transaction-related activities to support issuing the first pool bond
  • References
  • Chapter 16 Investing in catchment protection: The Water Fund model
  • 16.1 Introduction
  • 16.2 Principles and rationale
  • 16.3 Application to catchment protection
  • 16.4 Economic benefits and return on investment
  • 16.5 Trends: cobenefits, water funds beyond source water protection?
  • 16.6 Conclusions
  • References
  • Chapter 17 Leveraging private finance for landscape-level impact: the growing role for bankable nature solutions
  • 17.1 Introduction
  • 17.2 Support for bankable water solutions
  • 17.3 Bankable projects case studies
  • 17.4 Case study: Büyük Menderes river basin
  • 17.5 The roles of the stakeholders in financing partnerships
  • 17.6 Conclusions
  • References
  • Index

Product details

  • No. of pages: 414
  • Language: English
  • Copyright: © Elsevier 2022
  • Published: May 16, 2022
  • Imprint: Elsevier
  • Paperback ISBN: 9780128228470
  • eBook ISBN: 9780128228487

About the Editors

Xavier Leflaive

Xavier Leflaive joined the OECD Environment Directorate after 10 years of experience as a consultant on environmental and social issues. At the OECD, he has been working on policies to support eco-innovation and water management. His experience covers most OECD countries, Brazil and countries of the former Soviet Union. Xavier Leflaive holds a PhD in Social and Political Sciences from the University of Cambridge, UK.

Affiliations and Expertise

OECD Environment Directorate, L'Organisation de Cooperation et de Developpement Economique, Paris, France

Kathleen Dominique

Kathleen Dominique joined the OECD Environment Directorate in 2010. She currently leads OECD's engagement with the Roundtable on Financing Water, which aims to accelerate action to scale up financing that contributes to water security and sustainable growth. Kathleen Dominique holds a Masters Degree in Public Affairs from SciencesPo.

Affiliations and Expertise

OECD Environment Directorate, L'Organisation de Cooperation et de Developpement Economique, Paris, France

Guy Alerts

Guy Alaerts is a lead water resources specialist at the World Bank, and professor of knowledge and capacity building at UNESCO-IHE Institute for Water Education. He is involved in research on knowledge and capacity development of public water management organisations, and is working on large-scale water sector reform processes in Asia and South Eastern Europe.

Affiliations and Expertise

Professor of Knowledge and Capacity Building, UNESCO-IHE Institute for Water Education, The Netherlands

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