1. MENA Development Report On Water Making the Most of Scarcity MNA Water Seminar June 28, 2007 World Bank Tokyo Satoru Ueda

2. Active MENA Portfolio Algeria Bahrain Djibouti Egypt Iran Iraq Jordan Lebanon Libya Morocco Oman Saudi Arabia Syria Tunisia WBG Yemen Qatar UAE Lending up to US$100 million Lending over US$100 million Reimbursable Technical Assistance

3. World Bank Lending to the Water Sector in MENA Water Supply and Sanitation Water Resources Management Irrigation and Drainage * Fiscal year 2007 figures are forecasts Active Portfolio # US$1.7 billion 25 Projects 9 Countries # FY07 approvals up to March 31, 2007

4. How will our actions today change this landscape tomorrow?

5. Why did we do this report? Many excellent reports outline strategies for water actors This report –shows how non-water sectors must also act –Analyses political economic context that might enable reform

6. Outline of presentation Accelerate pace of reform Involve non-water sectors Find opportunities in changing political economy Turn promise into reality through accountability

7. Accelerate the pace of reform….

8. Overview Key Sector Issues in MENA –Water Scarcity has been a fact of life in MENA –Management of resources is inefficient –Unclear policies on cost recovery and subsidies World Bank Water Sector Program in MENA Future Outlook – Accountability for better water management

9. Situation is already critical Annual renewable water resources per capita

10. Deterioration of water quality is already costly

11. And growing populations mean scarcity will get worse Population Per capita water availability will fall by half by 2050

12. And climate change likely to reduce rainfall by at least 20%

13. MENA countries are spending heavily on water

14. Not getting full benefits from public investment Command area of dams, compared to area equipped for irrigation

15. Water infrastructure often not used because of shortages Dams in Morocco are often less than half full

16. Public funds subsidize services that provide mainly private benefits Operating cost coverage ratio for cities >1mn

17. Water Access is High, But … Supply is often limited and service is intermittent –Resource allocation policy, i.e., most of the water is allocated to lower value uses (agriculture vs. domestic) –Low levels of cost recovery resulting in lack of funding to adequately manage and operate facilities

18. In Wastewater … Some facilities operate at levels lower than design capacity or are non-operational –Insufficient level of connections to the wastewater network –Lack of funding for operation and maintenance

19. Problem well known yet progress has been slow, for many reasons

20. Yet region has history of adapting to water scarcity Societies developed over millennia to deal with scarcity Public institutions led investments in large infrastructure systems Institutions now need to adapt to new realities

21. And promising initiatives emerging across the region Private sector investing in irrigation infrastructure Users taking control of their irrigation water and infrastructure Technological advances reducing price of desalination User associations to monitor groundwater

22. What can be done: 1. Involve non-water sectors

23. Many factors affect water outcomes Energy prices Trade policies Public finance Employment opportunities

24. What can be done: 2. Find opportunities in the changing political economy

25. Potential opportunity as political dynamics may be changing Interest Groups Policy-Makers Political Economy Social & Cultural Forces Economic Forces Environmental Forces Technical Options Institutions Water outcomes Desal costs Migration, increased education

26. Spotting changes in the political economy and making the most out of them to improve Cost Recovery Management and operation of facilities Putting in place appropriate incentives

27. Opportunity for reform greatest while change is underway Important transformations on the horizon Important to prepare for potential opportunities Harder to reform after new situation is consolidated

28. What can be done? 3. Improve accountability to users

29. Public accountability will be key to turning opportunities into improved water outcomes

30. Greater accountability helps all aspects of water management Governments and service providers must be accountable to users Provides information necessary for making and enforcing decisions that reflect everyone’s needs Ensures that governments and service providers see consequences of actions Helps improve how well public money is spent

31. To recap ….. Accelerate pace of reform Involve non-water sectors Find opportunities in changing political economy Turn promise into reality through accountability

32. What does this mean for us all? This is a challenge the region can meet, but action is needed Water is everyone’s business – all sectors must play their part Improving accountability to users is a key step to realizing the opportunities presented by changing world

33. With these changes, water – the essential resource -- can help MENA’s people thrive