Easing the Transition to Commercial Finance for Sustainable …

WATER GLOBAL PRACTICE

Easing the Transition to Commercial Finance for Sustainable Water and Sanitation

AUGUST 2017

Amanda Goksu, Sophie Tr?molet, Joel Kolker, and Bill Kingdom

About the Water Global Practice

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Easing the Transition to Commercial Finance for Sustainable Water and Sanitation

AUGUST 2017

Amanda Goksu, Sophie Tr?molet, Joel Kolker, and Bill Kingdom

? 2017 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet:

This work is a product of the staff of The World Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent.

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Please cite the work as follows: World Bank. 2017. Easing the Transition to Commercial Finance for Sustainable Water and Sanitation. World Bank, Washington, DC. Any queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@.

Cover design: Jean Franz, Franz & Company, Inc.

Contents

Acknowledgments

vii

Executive Summary

ix

Abbreviations

xv

Chapter 1 Introduction

1

1.1 A Global Commitment to Water and Sanitation for All

1

1.2 Purpose and Scope

1

1.3 The Broader Agenda: It's Not Just About Money

2

1.4 Target Audience

4

1.5 Report Content

4

Note4

Chapter 2 Why Is a New Financing Framework Needed?

5

2.1 The Status Quo Is Not Enough

5

2.2 The Investment Gap Is Widening

5

2.3 The Financial Landscape Is Changing

7

2.4 The Potential Benefits Are Immense

8

2.5 How Is the WSS Sector Currently Funded?

10

2.6 Conclusion

14

Notes

14

Chapter 3 A Proposed Framework for Financing Universal Access

17

3.1 Easing the Transition

17

3.2 Why Does WSS Not Typically Attract Commercial Finance?

19

3.3 A New Financing Framework

21

3.4 Conclusion

21

Notes

21

Chapter 4 Component 1: Plan, Budget, and Allocate Public Resources More Efficiently

23

4.1 What Needs to Change?

23

4.2 WSS Sector Strategy and Policy

23

4.3 Sector Financial Planning and Budgeting

25

4.4 More, and Better, Subsector Allocation

26

4.5 Better Use of Tariffs and Subsidies

27

4.6 Funding and Capacity Building of WSS Sector Institutions

31

4.7 Conclusion

32

Notes

32

Easing the Transition to Commercial Finance for Sustainable Water and Sanitation

iii

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