water sector strategy · in the water sector. 1.2 scope of the strategy the present strategy...

S t r a t e g i e S 1 5 2

Water Sector Strategy

� Water Sec tor Strategy

Content

1 Purpose and Scope of the Strategy 4

1.1 Purpose of the Strategy 41.2 Scope of the Strategy 4

2 The Importance of the Water Sector and Challenges in the Partner Countries 5

2.1 Importance of the Water Sector 52.2 challenges in the Partner countries 8

3 Principles and Objectives of Development Cooperation in the Water Sector 10

3.1 general Framework for Development cooperation 103.2 Sector-Specific goals 113.3 the Human rights Dimension 123.4 Sector-Specific Principles 12

3.4.1 Integrated Water resources Management (IWrM) 123.4.1.1 core elements 123.4.1.2 objectives 143.4.1.3 conflicts Between the Various objectives 163.4.1.4 guidelines for the Implementation of IWrM in Development

cooperation 173.4.2 Multilevel approach 17

4 Lessons Learned from Development Cooperation in the Water Sector 18

5 Target Groups, Partners, Instruments and Fields of Action 21

5.1 target groups 215.2 Partners 215.3 Instruments 22

5.3.1 Multilateral and european Development cooperation 225.3.2 Bilateral Development cooperation 225.3.3 Support for Non-governmental organisations/actors 22

�Water Sec tor Strategy

5.4 Fields of action 235.4.1 reforming the Framework conditions in the Water Sector

and Water resources Management 235.4.2 Water for People: Water Supply and Sanitation 245.4.3 Water for Food 255.4.4 Water for ecosystems 255.4.5 Water for other Purposes 265.4.6 Special areas: Flood Management and Dams 26


1 Purpose and Scope of the Strategy

1.1 PurposeoftheStrategy

the present Strategy is the binding guideline

for the formulation of german development

cooperation (DC) in the water sector. it also

explains the importance of the water sector for

development cooperation. the Sector Strategy

serves as the basis and provides a set of criteria for

sector dialogue with partners and other donors,

for the BMZ‘s priority area strategy papers, for

the planning and implementation of german

development projects, and as a benchmark for

the assessment of european and multilateral

development cooperation in the water sector.

the Sector Strategy provides guidance for non-

governmental organisations on approaches and

developments in german development coopera-

tion and offers interested third parties informa-

tion about the german government‘s support

policy for cooperation with developing countries

in the water sector.

1.2 ScopeoftheStrategy

the present Strategy relates to the entire water

sector and associated fields and therefore differs

from the Water Concept adopted by the BMZ in

1996, which focussed on water supply and sanita-

tion. as well as dealing with the various uses of

water – Water for People (drinking water supply

and basic sanitation, wastewater and waste man-

agement), Water for Food (agriculture, livestock

farming and forestry), Water for Ecosystems (ter-

restrial ecosystems such as wetlands and forests,

freshwater ecosystems) and Water for Other Pur-

poses (tourism, energy, industry etc.) – the Sector

Strategy also considers the special areas of flood

management and dams.

this Sector Strategy describes the various types of

use as areas of development action to the extent

that they pertain to the water sector. it illustrates

how development cooperation in the water sector

can make the best possible contribution to devel-

opment policy objectives and offers conceptual

guidelines for this process. Development coop-

eration in other sectors must also comply with

the present Sector Strategy if it relates to or has a

bearing on water issues.


�

2 the importance of the Water Sector and Challenges in the Partner Countries

2.1 ImportanceoftheWaterSector

“Clean water and sanitation can make or break

human development. They are fundamental to

what people can do and what they can become

– to their capabilities. Access to water is not just

a fundamental human right and an intrinsically

important indicator for human progress. It also

gives substance to other human rights and is a

condition for attaining wider human develop-

ment goals”.

Source: HumanDevelopmentReport�006:

Beyond scarcity: Power, poverty and the global

water crisis, UNDP, 2006.

Water is an essential element for life on earth.

the problems of water pollution, scarcity/ excess

and major fluctuations in water availability,

all of which are increasing in severity in many

countries, have an impact on human health, food

availability, and economic and social develop-

ment. Poor countries are especially hard hit by

poor water quality, inadequate supply, droughts

or floods as their institutions are weaker and they

have fewer financial resources to meet these chal-

lenges. it is also the poor who suffer particularly

from water-related problems, e.g. because they

lack access to clean water, cannot afford medical

treatment for waterborne diseases, live in areas at

risk from floods and mudslides, or because their

agricultural systems are entirely dependent on

erratic rainfall.

Water also plays a key role in crisis prevention

and conflict management. Water can worsen

crises, but it can also act as a catalyst for coopera-

tion between countries and between actors

within individual states.

interdependencies exist between the types of use

described below. Often, several types of use are

reliant on a single resource. Water is generally

used several times in a usage cascade, during

which its quality may deteriorate. these interde-

pendencies, and therefore also water competition

and conflicts, become more apparent as scarcity

and water quality problems intensify. Further-

more, larger interventions in one sector invari-

ably have a knock-on effect on other types of use

and must therefore be monitored carefully.

Water for People

Drinking water supply, basic sanitation, and waste-

water and waste management are key prerequi-

sites for a life in dignity. they prevent many of

the diseases which impair quality of life, impose

financial burdens on households and limit their

income-generation opportunities.

� according to the World Health organization, 80 percent of diseases in the developing world are caused by unsafe water, poor sanitation and a lack of hygiene education.

in many countries, it is the task of women and

girls to carry home the drinking water for their

families. Often, they spend many hours a day

fetching water – with ensuing impacts on their

health, schooling, vocational training, and

income-generation opportunities. Waterborne

diseases within the family may also take up more

of women‘s time as they are the main caregivers

when family members fall sick. Women and girls

6 Water Sec tor Strategy

therefore benefit especially from improvements

in water supply and sanitation, as this can reduce

the physical burden and amount of time spent

fetching water, caring for the sick, disposing of

wastewater, and dealing with domestic hygiene.

With more time available, women are able to pur-

sue other activities, including income generation.

in addition, many girls can only attend school

once appropriate sanitary facilities are provided.

Drinking water supply accounts for around 10

percent of global water consumption. in rural

areas, drinking water withdrawal often does not

inflict stress on the resource situation. in today‘s

expanding urban centres, however, it has a major

impact on the quality and quantity of surface

water and groundwater. in particular, contamina-

tion of watercourses due to poor wastewater and

waste management can cause irreversible damage

if the environment‘s pollution absorption capaci-

ties are exceeded.

adequate wastewater management therefore not

only has positive impacts on settlement hygiene;

it also plays a key role in resource conservation.

Furthermore, in situations of water scarcity, appro-

priately adapted wastewater management can

create the conditions for the reuse of treated

wastewater in agriculture and industry, thereby

freeing up precious freshwater for the drinking

water supply and easing the burden on the water

balance. Due to the interdependencies in the

hydrological cycle, wastewater management

also plays a central role in protecting the earth‘s

oceans.

Water for Food

the term “water for food” denotes water that is

used in agriculture in order to feed the world‘s

growing population. in the broadest sense, it

comprises all types of land use which consume

water for food production and income genera-

tion, including rain-fed and irrigated agriculture,

livestock farming, forestry and aquaculture.

agriculture alone accounts for 70 percent of global

water consumption, rising to above 90 percent

in many arid and semi-arid countries. However,

the efficiency of water use and its economic

importance are often low: in many cases, water

loss amounts to more than 50 percent, and the

amount of water withdrawn is grossly dispropor-

tionate to the share of economic added value

created. as water demand intensifies and climate

change increases, the need for action in this area

is likely to become more acute.

as water consumption rises, the use of wastewater

and human excreta is playing an increasingly

important role in agriculture. in drylands in par-

ticular, largely uncontrolled and intensive use of

untreated wastewater is already occurring, with

devastating impacts on the health of the farmers

and the consumers of the food produced. in order

to make the nutrients contained in household

waste and wastewater available to agriculture in

a safe and hygienic manner while reducing the

nutrient load in watercourses at the same time,

more and more countries are introducing closed-

loop sanitation and wastewater management

strategies.

Water for Ecosystems

ecosystems are reliant on adequate water quan-

tity and quality. they play a key role in the hydro-

logical cycle and form important natural reser-

voirs such as wetlands, tropical forests and lakes.

ecosystems transform water into life and absorb

parts of the hydrological cycle, which are then no

longer available for human use. the feedback

effects of forests and afforestation on erosion,

mudslides, flooding and precipitation also vary

according to climate, geology and geomorphol-

ogy, water catchment size, etc. a differentiated

approach is therefore required when evaluating

the water-related environmental performance of

these ecosystems. at the same time, analyses show

that with rising income, demand for environ-

mental services such as clean air and recreation,


and therefore the value put on them, increase

significantly.

in practice, it is clear that the environment often

carries little weight in negotiating processes on

intersectoral resource allocation. this is either

because the environment lacks advocates alto-

gether, or its advocates do not wield the requisite

influence. as a rule, it is the poor who suffer most

from environmental pollution and who are most

directly reliant on environmental services. in cal-

culating the hydrological balance in research and

politics, too, the water requirements of natural

ecosystems are often ignored.

Water for Other Purposes, Including Energy

Besides food security, the availability of water

is an important basis for all other productive

activities. Water is essential for commerce and

industry, where it is used as a medium (e.g. as a

solvent), coolant or mode of transport in most

production processes. according to UNeSCO,

industrial uses currently account for about 20

percent of global water consumption, and this is

likely to increase to 50 percent by 2020. in some

countries, tourism is also responsible for a large

percentage of water consumption.

Water is also an important resource for energy

production, especially via hydropower plants.

thermal power stations require water for cooling

during operation or as a conveyor of heat energy.

Hydropower is likely to become increasingly

important in the context of the global climate

change debate, as it is often a cheap renewable

energy resource, which generally causes far fewer

negative environmental impacts than other

energy sources. Harnessing the energy contained

in wastewater and human excreta through the

use of heat pumps or via methane production can

also make a contribution to energy supply.

The Importance of Flood Management

extreme flood events pose a danger not only to

people and infrastructure but also to cultural

property and environmental resources. in less

developed countries, flooding can claim thou-

sands of lives, cause epidemics, destroy invest-

ment in infrastructure, and thus impact severely

on economic development. However, countries

whose economic and social development is heav-

ily dependent on agriculture may be partly reli-

ant on fertile floodplains for food production and

poverty reduction. the frequency and variability

of extreme flood events are changing; this is due,

among other things, to large-scale deforestation,

sealing of soils, and climate change. Population

growth and the ensuing settlement of new areas

as well as urbanisation are increasing the num-

bers of people at risk from flooding worldwide,

thus contributing to greater vulnerability and

potential damage.

The Importance of Dams

Dams are important for flood protection, irri-

gation, drinking water supply and renewable

energy production. in light of population growth,

economic development, climate change and,

to some extent, the still untapped potential of

hydropower, dams can offer useful opportunities

for development in many areas. in the past, how-

ever, many dam construction projects had devas-

tating social and environmental impacts and

also proved to be unprofitable. there are often

alternatives to large dam construction, e.g. better

rainwater harvesting, small-scale dams, artificial

groundwater recharge, demand management, etc.


2.2 ChallengesinthePartnerCountries

“In many countries water governance is in a state of

confusion: in some countries there is a total lack of

water institutions, and others display fragmented

institutional structures or conflicting decision-

making structures. In many places conflicting

upstream and downstream interests regarding

riparian rights and access to water resources are

pressing issues that need immediate attention; in

many other cases there are strong tendencies to

divert public resources for personal gain, or unpre-

dictability in the use of laws and regulations and

licensing practices impede markets and voluntary

action and encourage corruption.”

Source:The�ndUnitedNationsWorldWater

DevelopmentReport:Water – a shared

responsibility, World Water assessment Programme,

New york, 2006.

Water crises can be triggered by hydrological

factors but generally have institutional and socio-

economic causes as well; indeed, these may be the

primary factors. a major cause of water shortage,

pollution and inadequate access to water services

and sanitation is the lack of, and misallocation of,

public funds to finance investment and maintain

infrastructure. Other major factors are poor

resource management and ineffective legislation,

regulation and planning. Hydrological and institu-

tional weaknesses and under-funding often occur

in combination and are mutually reinforcing.

Inadequate Provision for poor Population

Groups

Despite major advances since 1990, around

1.1 billion people worldwide still lack access

to a safe drinking water supply and more than

2.6 billion people lack access to adequate sani-

tation. the poor in rapidly growing urban periph-

eries, rural settlements and the margins of small

and medium-sized towns and cities are especially

hard hit. the development of these areas is often

neglected. if they are considered at all for the

expansion of water services, local households are

in some cases unable to afford the charges for

connection to the system.

if local residents meet their drinking water needs

from natural sources, their health may be at risk

from waterborne diseases. Furthermore, women

and girls in particular may have to shoulder the

considerable physical and time burden associated

with fetching water from natural sources. Waste-

water and human excreta from sewers, cesspits

and people defecating in the open air further

impair the living environment and the water sup-

ply of the poor.

When drinking water is supplied from house con-

nections, yard taps or public water points, high

prices may be charged for the water. However, if

people have no connection to a water supply sys-

tem or access to a natural source, they may have

to purchase water from private water vendors,

often paying even higher prices and putting their

health at risk if these sources are not monitored

effectively by the state.

Water Scarcity on the Increase

Hydrological conditions in the partner countries

vary very widely: some of them have large vol-

umes of water available, whereas others have to

contend with acute regional or seasonal water

scarcity. However, supply bottlenecks are gener-

ally not just a hydrological problem but are often

caused by poor general and sector governance

and inadequate resource management.

Overall, water scarcity is noticeably increasing

due to the inadequate response by water sector

actors and strategies to high population growth,

rapid urbanisation, industrial development and

the expansion of irrigated agriculture, generally

with negative impacts on soils and watercourses

(groundwater, rivers and lakes). Overexploitation

of water resources causes a drop in the water


table and increases salt water intrusion in coastal

aquifers. it may also reduce the ecologically

necessary residual water flow in watercourses to

below minimum requirements, causing environ-

mental problems such as lakes drying out, deltas

silting up, etc.

Water scarcity is often coupled with short-term

water excess, even in countries where water is

generally scarce. Drought destroys vegetation

cover and causes hardening of the soil, thereby

reducing its water-holding and thus its buffer

capacities. as a result, droughts are followed by

floods and vice versa.

a good water sector policy which sets a course for

sustainable water resources utilisation is there-

fore key to mitigating or averting water crises.

there is also a need for action to improve the

response to changes in the amount and distribu-

tion of precipitation, evaporation rates etc. result-

ing from climate change.

Water Pollution on the Increase

Worldwide, 90 to 95 percent of the wastewater

from industry and households is discharged un-

treated into watercourses. Microbial contamina-

tion of water resources by domestic wastewater

has increased substantially. there is also contami-

nation from fertilisers and pesticides used in agri-

culture. as a result, in some partner countries,

making water resources available for use entails

high and rising costs of water treatment. increas-

ing pollution is also accelerating the degradation

of ecosystems (e.g. loss of biodiversity) and reduc-

ing their environmental performance. Unless it is

coupled with wastewater management, the ur-

gently needed expansion of water supply systems

can worsen the often already problematical hy-

giene conditions at local level, while freshwater

resources and aquatic ecosystems are put at risk

from the increase in the volume of wastewater. in

many cases, the available financial resources are

inadequate, and investments in wastewater man-

agement and the operation of water treatment

plants are not a political priority.

greater water scarcity due to the expansion of

irrigated agriculture and the increased influx

of fertilisers and pesticides into surface water

and groundwater are not the only problems,

however. in many partner countries, a drop in

soil fertility due to increased salinity and swamp

encroachment resulting from incorrect water use

in irrigated agriculture – especially in arid and

semi-arid climatic zones – is a serious and grow-

ing problem for the water sector.

Water as a Source of Conflict

Due to the rising demand for water for all types

of use and their strong interdependencies,

freshwater competition within and between the

individual types of water use is intensifying in

many water-scarce countries and regions. it is

becoming increasingly difficult to guarantee the

water supply to the urban centres as well as to

agriculture and industry, especially during peri-

ods of drought. the main areas of conflict are the

competition between drinking water supply and

agricultural irrigation, and between the urban

and rural water supply systems.

However, lines of conflict may also transcend

national borders. For example, within trans-

boundary river or groundwater catchment areas,

there is often great inequality between regions

and countries in terms of the availability of water

resources. Downstream riparian states are suffer-

ing increasingly from water shortage and quality

problems because countries upstream are with-

drawing larger amounts of water, or are allowing

wastewater or contaminated runoff from agricul-

ture to flow back untreated into the hydrological

cycle. Yet studies also show that water conflicts

are no less likely to occur where there is adequate

access to water. Conflicting territorial, economic

and security interests often play a background

role in inter-state disputes over water. Conversely,


transboundary water cooperation offers oppor-

tunities for coordinated joint water utilisation

in which complementary interests facilitate

mutually beneficial solutions. in many cases, this

can bring about a general improvement in neigh-

bourly relations between riparian states.

Impacts of Climate Change

in some partner countries, extreme droughts and

flooding are expected to occur more frequently

in the coming decades, and this may cause major

economic losses and social and environmental

disasters. Climate models predict that rising

temperatures will trigger major regional changes

in the amount and distribution of precipitation,

with direct consequences for the availability and

usability of water resources.

3 Principles and Objectives of Development Cooperation in the Water Sector

3.1 GeneralFrameworkforDevelopment

Cooperation

the german government‘s development policy

makes a contribution

l to reducing poverty worldwide,

l building peace and achieving democracy,

l achieving justice in globalisation, and

l protecting the environment.

it is guided by the vision of global sustainable

development, expressed equally in economic

performance, political stability, social justice and

environmental sustainability.

german development policy is implementing

the commitments undertaken in the Millennium

Declaration adopted by the United Nations and

aims to achieve the Millennium Development

goals (MDgs) derived from it. the interministerial

Program of action 2015 (aP 2015) is its key instru-

ment in this context.

in the Paris Declaration on aid effectiveness ad-

opted in March 2005, the german government

pledged to increase the quality and effectiveness

of its development cooperation. it does so by pro-

moting close cooperation between all donors and

development organisations and gearing its devel-

opment processes and tools towards optimising

impacts (impact orientation). the national devel-

opment strategies (e.g. the Poverty reduction

Strategy Papers / PrSPs) elaborated by the partner

countries on the basis of ownership, and the sec-

tor strategies which encourage better alignment

of donors‘ contributions, are the frame of refer-

ence for this process. Donor harmonisation should

ideally be undertaken by the partners. Donors

should respect and foster the partner countries‘

ownership and programming capacities, and

should not overwhelm or undermine them.

Development cooperation is engaged particu-

larly wherever it can achieve comparative advan-

tages and have a significant impact, where part-

ners show a willingness to engage in dialogue

and undertake reform, and where the institu-

tional, legal and political framework ensures that

sustainable outcomes can be achieved.

11Water Sec tor Strategy

“We, Ministers of developed and developing coun-

tries responsible for promoting development and

Heads of multilateral and bilateral development

institutions, meeting in Paris on 2 March 2005,

resolve to take far-reaching and monitorable

actions to reform the ways we deliver and man-

age aid (…).We reaffirm the commitments made

at Rome to harmonise and align aid delivery. (…)

We acknowledge that enhancing the effective-

ness of aid is feasible and necessary across all aid

modalities. In determining the most effective

modalities of aid delivery, we will be guided by

development strategies and priorities established

by partner countries. (…) Partner countries [will]

exercise effective leadership over their develop-

ment policies, and strategies and co-ordinate

development actions.”

Source: ParisDeclarationonAidEffectiveness

(Paris Declaration), Paris, 2005.

3.2 Sector-SpecificGoals

“In adopting the Millennium Development Goals,

the nations of the world pledged to halve by 2015

the proportion of people without sustainable ac-

cess to safe drinking water and basic sanitation.

Unless the world redeems that pledge, we will be

hard-pressed to meet the MDG targets in other

vital areas such as nutrition, education, poverty

eradication, and environment, for water is life. But

so far progress in meeting the MDG water and

sanitation target has been fitful and slow.

We need radical change and swift, resolute

action.”

Source: HashimotoActionPlan adopted by the

United Nations Secretary-general‘s advisory Board

on Water and Sanitation (UNSgaB) and presented at

the 4th World Water Forum in Mexico, 2006.

the MDgs and the Millennium Declaration con-

tain specific targets for development cooperation

in the water sector. the aP 2015 sets out how the

german government intends to make its contri-

bution to achieving them.

MDg 7 (ensure environmental sustainability) is

the key international goal here. it requires states

to commit to the sustainable development of

environmental resources in order to halt and

reverse their loss (target 9). the sustainable man-

agement of water resources for food security and

economic development is an important requisite

for achieving MDg 1 (eradicate extreme poverty

and hunger) and contributes to the attainment of

most of the other MDgs. target 10 aims to halve2,

2 as well as aiming to achieve the quantitative goal set out in target �0, development cooperation in the water sector also focusses on improv-ing the quality and environmental sustainability of supply as well as safeguarding the economic sustainability of infrastructural investments on a long-term basis.

by 2015, the proportion of people without sustain-

able access to safe drinking water and basic sani-

tation�.

� at the 2002 World Summit on Sustainable Development (WSSD) in Johannesburg, the sanitation target was adopted, inter alia at germany‘s initiative.

target 10 is also closely linked with other

MDgs. Because better access to clean drinking

water and basic sanitation has a positive impact

on health, nutrition and education and also on

gender equality, it can make a key contribution

to the attainment of the following MDgs: MDg

1, MDg 2 (achieve universal primary education),

MDg 3 (Promote gender equality and empower

women), MDg 4 (reduce child mortality), MDg 5

(improve maternal health), and MDg 6 (Combat

HiV/aiDS, malaria and other diseases).

the Millennium Declaration contains other com-

mitments of relevance to development coopera-

tion in the water sector: Chapter ii (“Peace, secu-

rity and disarmament”) sets out a commitment to

conflict prevention, while Chapter Vi (“Protecting

the vulnerable”) requires civilians to be protected

from the consequences of natural disasters.

�1 Water Sec tor Strategy

the Program of action 2015 contains several ref-

erences to MDg 7: Area for Action 2 (“realizing

the right to Food and implementing agrarian

reform”) states that the german government will

support programmes for food security, including

access to clean drinking water, as well as agricul-

tural research that is geared to the conservation

and efficient utilisation of water resources. Area

for Action 6 (“ensuring access to Vital resources

– Fostering an intact environment”) describes the

german government‘s support for its partner

countries in designing sustainable, pro-poor

water resource management practices. the Pro-

gram of action 2015 also takes up various other

criteria, set out in the Millennium Declaration, of

relevance to development cooperation in the

water sector, e.g. by advocating a conflict-sensitive

approach by development projects (do no harm)

and, in its provisions on disaster control, endorses

the elaboration of strategies enabling poor popu-

lation groups to adjust to climate change and flood

management within the development framework.

3.3 TheHumanRightsDimension

in water supply and sanitation, development coop-

eration also contributes to the realisation of the

human right to access to drinking water and basic

sanitation. this right is an element of the right to an

adequate standard of living enshrined in articles 11

and 12 of the international Covenant on economic,

Social, and Cultural rights (iCeSCr)4.

4 the International covenant on economic, Social, and cultural rights was adopted unanimously by the United Nations general assembly on �6 December �966 and has now been ratified by most UN member states (�5� parties as of 8 May 2006).

it is closely

linked with other human rights, notably the rights

to food, education and health as well as to political

and economic participation. in its Development

Policy action Plan on Human rights5,

5 See “Seventh report of the government of the Federal republic of germany on its Human rights Policy in the context of Foreign rela-tions and other areas of National Policy”, Section D, Federal Foreign office, June 2005.

the german

government pledges to make targeted efforts to

promote economic, social and cultural rights.

a core element of the right to water is the commit-

ment by states to ensure that everyone can meet

their basic water and sanitation needs. access must

be non-discriminatory. this means equal access

for all – for women and men, people with HiV/aiDS

and disabilities, indigenous and other margin-

alised groups, and the urban and rural population.

the principle of non-discrimination also applies

when, due to water scarcity, the right to water can-

not be implemented to its full extent, which may

entail the difficult task of prioritisation.

Water must be available, accessible, of acceptable

quality, and affordable. in individual cases, this

may entail an obligation to provide people living

in extreme poverty with the minimum amount

of water necessary for life at no charge if need be.

it is a matter for states to decide whether to fulfil

their obligations relating to the right to water

through private providers or the public sector.

3.4 Sector-SpecificPrinciples

3.4.1 IntegratedWaterResources

Management(IWRM)

3.4.1.1 CoreElements

“IWRM is a process which promotes the co-ordi-

nated development and management of water,

land and related resources, in order to maximise

the resultant economic and social welfare in an

equitable manner without compromising the

sustainability of vital ecosystems.”

Source: GlobalWaterPartnership: technical Paper

No. 4, Stockholm 2000.

Water Sec tor Strategy 1�

integrated Water resources Management (iWrM)

is the internationally recognised paradigm for

good water sector policy. iWrM also provides

guidance for the pursuit of the above-mentioned

objectives of development cooperation in the

water sector:

1) for the selection of priority subsectors as

fields of action for development engage-

ment, and

2) for the development of assistance strate-

gies within these subsectors.

iWrM entails a holistic approach to the water

sector and formulates appropriate principles for

policy action. the paradigm is based on the three

pillars of sustainable development (environmen-

tal sustainability, social justice and economic

efficiency, flanked by political stability) and the

recognition that water problems often cannot

be resolved within individual subsectors but can

only be mastered through integrated manage-

ment of all types of water use.6

6 a key step in the development of the IWrM concept was the formula-tion of the Dublin Principles at the International Conference on Water and the Environment in �992. the Principles define fresh water as a finite and vulnerable resource, essential to sustain life and the environ-ment. Social and economic development should be linked with protec-tion of natural ecosystems, and water should be recognised as an eco-nomic and social good. the Dublin Principles also call for recognition of the central part played by women in the provision, management and safeguarding of water, and a participatory approach to water-related decisions.

the basic principles of iWrM are:

Water Resources Management According to

Natural Boundaries

Water does not respect political or administrative

boundaries. Water flow is determined by geologi-

cal and geomorphological structures and may

also cross national borders. Sustainable water

resources management should therefore be

based on water catchment areas.

iWrM‘s holistic approach also means integrating

land use and water issues. Here, the water quan-

tity and quality requirements of various types

of land use must be taken into account in water

resources management, and by the same token,

the impacts of land use on the quantity and qual-

ity of these resources must be considered.

Participation and Transparency

a core element of the iWrM concept is the par-

ticipation of all relevant actors in decisions which

affect them. iWrM requires the knowledge, per-

spectives and interests of these actors to flow into

the decision-making process, with equal partici-

pation of women in decision-making. this applies

to all water subsectors, especially when conflicts

arise between or among individual user sectors.�

� For example, in the past, private-sector involvement in drinking water supply and sanitation was often an area of conflict.

in the context of development cooperation, this

means that appropriate opportunities for public

participation in the development of management

and action plans, in project planning and imple-

mentation, and in the operation of systems must

be provided, utilised and expanded if necessary.

in this context, gender equality and participation

by civil society organisations must be ensured. in

local rural development projects, this participa-

tion can take place via awareness-raising and

information events and the formation of and sup-

port for user groups, water boards or similar bod-

ies. in the case of larger urban or transregional

projects, german development agencies are also

working to ensure that adequate information is

provided for, and consultations held with, stake-

holders and users, starting with the planning

1� Water Sec tor Strategy

process onwards. Furthermore, appropriate

structures are being demanded and supported

so that users and stakeholders are represented in

planning, implementing and supervisory bodies,

if necessary via civil society organisations. appro-

priate preparatory, monitoring and/or follow-up

management of the social environment can make

a key contribution to project sustainability.

Subsidiarity

in line with the subsidiarity principle, water-

relevant decisions should be taken at the lowest

appropriate level. this is the best way to ensure

that decisions are in line with the needs of users

and other stakeholders. the aim from the outset

is to avoid unforeseen and negative impacts of

water-relevant activities on specific social groups.

the allocation of responsibilities must depend

on the tasks in question. For example, the water

user group level is the appropriate level for deci-

sion-making on the operation and maintenance

of irrigation systems. However, decisions on water

resource allocation between various user sectors

should be taken at a higher level, i.e. at water

catchment level – also in the case of transbound-

ary water catchments.

Knowledge Management

Developing a knowledge base about water

resources and water use is the basis for problem-

oriented decision-making in the water sector.

Many developing countries lack adequate

basic data about water quality and quantity in

the catchment areas and on sociocultural and

socioeconomic factors. in many cases, data is

only available to administrative bodies whose

geographical range does not match the water

catchment areas in question.

as it is neither possible nor rational to collect

every item of relevant information, actors should

focus on regular collection of key data. this must

include surveys on the affordability of, and practi-

cal access to, water services for the poor and other

marginalised groups. in order to identify the most

discriminated groups and provide appropriate,

problem-oriented support, data on the poverty

situation and, if appropriate, on gender-specific

factors as well as information on discrimination

caused by other factors must be collected on a

differentiated basis and made available to all the

relevant actors.

3.4.1.2 Objectives

in line with the iWrM concept, the following

dimensions must be taken into account in deci-

sion-making in the water sector:

Environmental Sustainability

Water will continue to be vital for future genera-

tions. Water resources management therefore

aims to achieve a balanced water budget, which

means that water withdrawals should not

exceed the amount of available renewable water

resources in order to avoid a drop in groundwater

levels or the drying out of surface watercourses.

if there is a need to draw on fossil water reserves

because there is insufficient renewable water

available for the drinking water supply, new

methods of providing water should be developed

– as long as they are economically and ecologi-

cally viable – such as seawater/brackish water

desalination, artificial groundwater recharge, or

the use of treated wastewater, in order to avoid

long-term supply bottlenecks and ecosystem

disruptions.

alongside water quantity, water quality is

also playing an increasingly important role in

environmental sustainability. in order to avoid

further pollution of surface water and ground-

water, commercial, industrial and agricultural

production processes should be restructured,

closed-loop strategies incorporated to a greater

extent into all sectors, and wastewater treatment


and recycling/reuse substantially expanded. in

this context, the avoidance, collection, treatment,

reuse or proper disposal of all types of pollutants

and waste play an important and complementary

role.8

8 See also the BMZ‘s Waste Management Sector Strategy.

Social Justice

equitable access to water and sanitation services

for all population groups is a core element of

social justice. Poor availability of water services

for specific social groups is an indicator of social

injustice and also heightens social disparities.

access to drinking water and basic sanitation is

also recognised as a human right (see Section 3.3).

in most countries, however, there is a wide gap

between entitlements and reality. a key prior-

ity in water sector policy must therefore be to

improve the situation of poor population groups,

which still have no access to drinking water and

sanitation or to adequate water for their agri-

cultural production. as a general principle, the

measures adopted should not exacerbate poverty

or worsen the status of women, nor should they

intensify or, indeed, trigger discrimination

against specific ethnic or regional minorities.

experience has shown that it is not always pos-

sible to align the water interests of different

social groups, and so appropriate mechanisms

for participatory conflict resolution should be

established in accordance with human rights

standards and principles. the aim is to achieve a

consensus among all stakeholders when disputes

arise. Often, however, consensus-based decision-

making is impossible in practice. Participation

does not automatically lead to consensus, as

decisions are never taken in contexts that are

entirely power- or interest-free. For that reason

too, participation requires the establishment of

appropriate institutions and processes. in many

cases, besides the adoption of consultation and

compensation mechanisms, support must also

be provided to build or improve the political

dialogue capacities of poor and disadvantaged

groups (empowerment).

Economic Efficiency

Many of the mistakes made in water resources

management arise from the fact that water

prices, as a key benchmark of scarcity and prefer-

ences, and therefore a steering instrument for

efficient, needs-related water allocation, do not

exist, are distorted, or do not have the impact

they should have. this is apparent from the fact

that the value put on water as a resource is often

too low (e.g. omitting environmental services)

or non-existent, does not take full account of the

costs of treating and supplying the water, and

does not aim to cover the costs of water services.

tariff and charging systems play a key role in this

context, but other demand management and

regulatory instruments – such as rationing, quotas

and tradable water rights – all play a part in deter-

mining whether water, as a scarce resource, is

managed efficiently and sustainably and can thus

be supplied to everyone on an equitable basis.

in line with the iWrM concept, not only the costs

of providing water (operating expenditures and

capital charge for water withdrawal, treatment,

distribution, purification etc.), but the full eco-

nomic costs (including opportunity costs) and

the environmental externalities should be taken

into account so that allocation and management

decisions can be made, which are rational and

efficient from a macroeconomic perspective.

indirect cost factors such as fuel costs or technical

standards often play a key role here. However,

determining the total utility, opportunity costs

and environmental externalities often poses

methodological difficulties, which is why the

values assumed in this context are often only

approximate.


For efficient water resources management, an

operational perspective is also of key importance

alongside macroeconomic considerations. in

line with this approach, the full economic cost

(operating expenditures and capital charge,

including appropriate minimum interest pay-

ments) at the level of the public or private utility

company must be covered from revenue. Full cost

recovery is a key prerequisite to ensure the sus-

tainable operation of systems and must include

appropriate funding for investment in renewal

and expansion. Due to the positive externalities of

pro-poor and environmental measures in water

and wastewater management9

9 UNDP 2006: Linking Poverty reduction and Water Management. UNDP and the Stockholm environment Institute, prepared on behalf of the Poverty-environment Partnership.

, full cost recovery

can also be achieved through supplementary

state subsidies. For development cooperation,

this means that in sector dialogue and practical

cooperation, the aim must be to improve the

institutional, financial, legal and organisational

framework for sustainable service delivery.

Compliance with the principle of full cost recov-

ery does not rule out the option of providing

poorer social groups with a basic drinking water

supply to meet their essential daily needs as well

as basic sanitation at lower prices, i.e. prices

which generally do not cover the costs, or even

at no charge in extreme cases. the same applies

to sanitation. a socially compatible system of

charging or, alternatively, direct person-specific

transfer payments enable water and sanitation to

be supplied to low-income or other marginalised

groups in order to meet their basic needs.

3.4.1.3 ConflictsBetweentheVarious

Objectives

When adopting individual measures in the water

sector, it is not always possible to achieve all the

above-mentioned objectives to an equal extent.

For example, in situations of severe seasonal or

regional water scarcity, conflicting priorities can

rapidly arise between the need to expand water

services, on the one hand, and environmental sus-

tainability, on the other. in water catchment areas

with a strained or negative water balance, the

drinking water supply can only be safeguarded –

if no water is to be diverted away from agriculture

– through the temporary or permanent overex-

ploitation of groundwater or from rivers and, in

extreme cases, the utilisation of fossil groundwater.

in such situations, the need to ensure a basic supply

of water services to poor population groups must

be brought into line with the need for environ-

mental sustainability. in the long term, social jus-

tice can only be achieved on the basis of ecologi-

cally sustainable resource management.

For development cooperation, this means that

promoting measures to supply the population

with water can be considered even in cases of a

negative water balance, if these measures are

likely to result in substantial and positive devel-

opment impacts. in humanitarian emergencies,

the use of non-renewable fossil groundwater as

a source of drinking water is also tolerable in the

short term. in both cases, however, every opportu-

nity must be utilised to improve the water balance

both beforehand and as a flanking measure. in

particular, the use of fossil water must always be

subject to a comprehensive evaluation of alterna-

tive options.

a further conflict between objectives may arise

between economic viability and the need for

social justice. in many cases, for example, connect-

ing poor and other marginalised households to

the water supply and sanitation system is not com-

mercially viable, whereas it is of course an impera-

tive from a social and economic perspective. Here,

regulatory provisions are required, including

adequate control and incentives to safeguard a

supply to disadvantaged social groups.


in terms of water quality, environmentally moti-

vated restrictions on the management of land

and water resources often cause conflicts with

the economic performance objective and with

social objectives. For example, the establishment

of water protection areas may curtail the income

generation opportunities available to the local

population. Here too, the conflicting objectives

must be carefully weighed up and a viable solu-

tion achieved between stakeholders on the basis

of broad participation.

Development cooperation contributes to ensur-

ing that conflicts between iWrM‘s various

dimensions are made transparent and mitigated,

or, in an ideal scenario, resolved.

3.4.1.4 GuidelinesfortheImplementationof

IWRMinDevelopmentCooperation

iWrM formulates principles for water sector

policy as a whole and for water resources manage-

ment in particular. However, the concept should

not be regarded as a rigid blueprint. On the con-

trary, it must be implemented on a context-specific

basis. iWrM is an ongoing process to optimise the

water sector in line with the specific needs of the

local population and the environment. Specific

iWrM plans by the partner country can be help-

ful, but are not a prerequisite for the adoption

of iWrM principles in the water sector. even if a

country‘s water sector policy conflicts with core

aspects of iWrM, development cooperation may

be justified in certain water subsectors provided

that this cooperation itself complies with iWrM

principles and supports the integration of these

principles in the partner country‘s sector policy.

Wherever possible, development cooperation

is integrated into ongoing iWrM processes,

with development measures linking in with

existing water management plans. However,

development cooperation is particularly engaged

in those sectors where german development

agencies have comparative advantages, where

partners are willing to engage in dialogue and

undertake reforms, where it can have a signifi-

cant impact, and where appropriate institutional,

legal and political frameworks ensure that devel-

opment measures have a sustainable effect. this

decision is taken in agreement and – wherever

possible – in cooperation with other donors.

3.4.2 MultilevelApproach

in order to achieve structural and sustainable

impacts and increase the effectiveness of actions,

development cooperation in the water sector is

targeted at several intervention levels simultane-

ously: policy development, framework planning

and legislation, regulation, and other control,

supervisory or coordination functions (macro

level); supply and disposal services and/or other

water-relevant management functions (meso

level); and finally at target group level, e.g. custom-

ers, consumers, farmers, industry, other users and

stakeholders (micro level). Locally adapted dem-

onstration projects have also proved helpful in

introducing innovative concepts. at regional

level, german development cooperation supports

networking and cooperation between existing

institutions, e.g. in basin management. the multi-

level approach should be applied on a context-

specific basis. the progressive adoption of mea-

sures at various levels over time has also produced

good results in the past. german development

cooperation does not need to take action at all

levels in every case; often, other donors deal with

some of these tasks.

1� Water Sec tor Strategy

4 Lessons Learned from Development Cooperation in the Water Sector

Most donors have taken account of iWrM prin-

ciples in their development cooperation in the

water sector for many years. in some countries,

for example, german development cooperation

initiated iWrM processes in the early 1990s –

always in close dialogue with other donors. Par-

ticularly in countries with water scarcity or water

quality problems, iWrM components were being

implemented in water resources management

even before the iWrM concept per se was known.

For example, the partner countries were given

assistance to draft appropriate legislation, under-

take studies on water resources, and produce

master plans for the water sector. through its

engagement, german development cooperation

has also helped persuade some partner countries

to shelve plans aimed at harnessing additional

water resources and focus instead on efficient

water allocation and the reduction of water losses

and wastage through economic and regulatory

policy instruments based on demand manage-

ment. in rural water and irrigation projects in

particular, german development cooperation

has supported participatory processes through

the establishment of user groups. Since the early

and mid 1990s, investment in the development

of wastewater management and waste manage-

ment systems respectively has also increased sig-

nificantly. german development cooperation has

supported and further developed the ecological

sanitation (“ecosan”) approach in order to facili-

tate the practical application of closed-loop strat-

egies in the wastewater management subsector.

“Considering the environmental damage, the

health risks, and the worsening water crisis, a

revolutionary rethink of our current sanitation

practices is urgently needed. Ecosan provides a

solution by applying the basic principle of closing

the loop through the application of modern and

safe sanitation and reuse technologies, thereby

continuing the historic tradition of recycling

human wastes once applied in most farming-

societies.”

Source: Poverty-EnvironmentPartnership:

Linking poverty reduction and water management,

Stockholm environment Institute and United

Nations Development Programme (eds.),

published online in 2006.

the holistic approach to water sector develop-

ment, taking account of all types of use and

incorporating socially compatible and economi-

cally efficient allocation mechanisms, is still in

its infancy in many countries, however. there are

many reasons for this:

l iWrM principles are not yet adequately

embedded in many partner countries‘

strategies. in most cases, the requisite

reform processes have been initiated by

donors. Some partner countries have only

internalised the principles underlying the

reforms to a limited extent. in some coun-

tries and regions that are particularly hard

hit by water scarcity, sector reforms have

only been implemented in areas where little

political resistance has been encountered,

notably the adoption of legislation: the

legislative framework for the water sector,

and indeed environmental legislation in

1�Water Sec tor Strategy

general, are generally fairly well developed.

Many countries already have quite a few

elements of legislation governing the water

sector which take account of sustainability

aspects and make drinking water a priority.

the problem, however, is often the imple-

mentation and enforcement of new regula-

tions vis-à-vis influential elites. these elites

profit especially from the cheap water avail-

able in irrigated agriculture, but also from

subsidies – supposedly granted in response

to social factors – in urban water supply and

wastewater management systems.

l the sectoral structure of the administra-

tion in many partner countries often still

conflicts with the adoption of integrated

approaches. the geographical range of

water catchment areas generally does not

conform with the existing administrative

units. the administrations often show little

willingness to cooperate. institutions –

such as water catchment authorities – that

are newly established as part of reform

processes are often not properly integrated

into existing institutional structures and

socioeconomic frameworks. in most cases,

they have been created on top. they also

have insufficient powers; in particular, they

lack clear rules for interfacing with other

institutions. the legally established water

catchment authorities are often under-

funded, with the result that they cannot ful-

fil their mandate properly. Other agencies

refuse to cede formal and policy-making

powers to the water catchment authorities.

these authorities should therefore not

be regarded as the only viable approach

to solving problems in water resources

management. instead, a careful appraisal

should be undertaken on a country-specific

basis to identify the institutional form that

is most appropriate for efficient iWrM

implementation.

l implementing comprehensive multisec-

toral water programmes based on iWrM is

often very complex. it is often more effec-

tive to implement clearly focussed sectoral

projects that aim to facilitate local capacity-

building and reforms and achieve social,

environmental and economic objectives.

in these cases, it is nonetheless essential

to integrate the projects consistently into

the overall water sector context and thus

to make a progressive contribution to the

establishment of a wider process which con-

forms with iWrM principles. in other cases,

an overly restrictive subsectoral approach

may not be appropriate to achieve the

desired structural impacts. in such cases,

broad-based sectoral engagement is

essential to achieve the necessary structural

outcomes in line with iWrM principles.

l the majority of developing countries still

have a long way to go to achieve full cost

recovery in all areas of water use. Often,

only the operating and maintenance costs

are – barely – covered, while the necessary

cross-subsidy potential is not achieved.

improving the institutional, legal and

organisational framework is essential for

efficient, user-oriented service delivery.

However, as improving the framework

conditions is a protracted process, which

must form part of a wider good governance

policy, the aim of cost recovery can gener-

ally only be achieved in most developing

countries on a progressive basis over a

period of several years.

l in german development cooperation, the

practical approach to prioritisation and

the selection of fields for development

intervention make it more difficult to

implement a holistic approach in the water

sector. For example, a distinction is made

between the following priorities: drinking

water supply and sanitation; (irrigated)


agriculture; and environmental and

resource protection. in most cases, german

development cooperation does not operate

in all of these sectors in every partner coun-

try, so it may not be in a position to finance

certain priority measures in the water

sector. to implement the iWrM approach,

it would therefore seem appropriate to

interpret the definitions and limits of the

priorities flexibly, or to agree on “water” as

a general priority.

l Lack of information impedes the planning

and management process. admittedly,

water master plans have been developed

occasionally, often with donor financing,

but they are not integrated into systematic

data collection and evaluation. the moni-

toring of water quantity and quality often

only takes place within individual projects,

and the same applies to the collection of

information about access to water in the

settlement areas of the poor. as a result,

measures are often being developed and

adapted on the basis of inadequate data.

For that reason, greater priority must be

given to the systematic development of a

data and information management system.

l even if good governance, participation,

institutions and capacities are in place,

implementing comprehensive reform

processes may take many years. interest-

related patterns of use by various consumer

groups can generally only be broken after

years of awareness-raising. Success factors

include a viable and robust basis for coop-

eration with decision-makers and staff in

key sectoral institutions, appropriate

involvement of representatives of interest

groups, especially extremely poor and

disadvantaged groups, and sufficient will-

ingness on the part of partners to under-

take reform. Development measures in this

area must therefore be geared towards

long-term engagement.

1Water Sec tor Strategy �

5 target groups, Partners, instruments and Fields of action

5.1 TargetGroups

the key target group for german development

cooperation in the water sector is the poor and

extremely poor population, which currently has

little or no access to safe and/or adequate drink-

ing water, sanitation and/or water for farming.

the urban slums and rural regions are especially

important in this context.

as a rule, it is also the poor groups who suffer

most from contamination of watercourses, as

they are often reliant on these sources of water for

drinking, irrigation and washing. Due to a lack of

alternatives, the poor often settle in areas which

are especially prone to flooding and mudslides.

they are also particularly hard hit by the decrease

in groundwater resources as they rarely have

access to the technologies or resources required

to draw water from ever-greater depths. german

development cooperation is also addressing these

problems as a priority.

Furthermore, development cooperation in the

water sector also benefits other demographic

groups by contributing to environmental protec-

tion and sustainable development in agriculture,

commerce and industry, thus promoting social

and economic development as a whole.

5.2 Partners

the challenges arising in the water sector can

only be solved through cooperation on the basis

of partnerships. Local partners for german

development cooperation generally include

government institutions and administrative

bodies, public corporations, non-governmental

organisations, joint agencies, water catchment

authorities, and user groups. in order to comply

with the iWrM approach, institutions operating

in associated sectors, such as ministries of agricul-

ture, health authorities and bodies charged with

implementing the closed-loop economy, should

also be included.

as experience has shown, women play a central

part in the provision, management and safe-

guarding of water and should be included

intensively in projects at target-group level.

their expertise and specific interests can also be

utilised at higher levels of planning and adminis-

tration, with intermediary organisations playing

a facilitating role here.

Partners in germany and europe include water

and wastewater management companies, asso-

ciations, plant construction companies, NgOs,

consulting firms, universities and other public

and private organisations operating in the water

sector. the mobilisation of private capital and

technical and commercial know-how can also

make major contributions to development coop-

eration in the water sector. the BMZ is working

with other relevant federal ministries to devise

coherent policy solutions aimed at global sustain-

able development in the water sector.

as part of the improved donor coordination

to which the international community is com-

mitted, german development has stepped up

its cooperation with other bi- and multilateral

donors. this cooperation primarily aims to

increase the effectiveness and efficiency of devel-

opment measures through better coordination

and synergies.

�� Water Sec tor Strategy

5.3 Instruments

5.3.1 MultilateralandEuropeanDevelopment

Cooperation

the german government plays an active role in

the formulation of water sector policies in the

multilateral financial institutions of which it is

a member. it does so in line with the principles

and objectives set forth in the Sector Strategy.

the same applies to the development coopera-

tion undertaken by the european Commission,

the european Development Fund (eDF) and the

relevant United Nations programmes and organi-

sations. in this context, particular importance is

attached to complementarity and coordination

between the various institutions in order to avoid

overlaps and keep transaction costs low. as a gen-

eral rule, water sector-specific initiatives should

not be implemented via new sectoral budget lines

but should be integrated into existing country

programmes to avoid increasing the coordina-

tion costs unnecessarily. the development of

innovative development instrument such as the

output-based aid (OBa) approach is also supported

in the water sector.

Furthermore, the german government is engaged

in the international water sector dialogue and

development-relevant international water

research. this is intended to promote mutual

exchange and learning from experience.

5.3.2 BilateralDevelopmentCooperation

german development cooperation supports its

partner countries through the provision of advi-

sory services and capacity-building, and through

training and development for professionals and

managers, in order to create frameworks which

facilitate development and improve the capaci-

ties of organisations and individuals working in

the water sector. in this role, it gears its efforts

towards long-term support for the partner coun-

tries in all phases of the reform and restructuring

process. Particular importance is attached to

building national advisory capacities and facili-

tating south-south dialogue.

infrastructural expansion is equally important for

water sector development and is supported through

appropriate funding instruments. Key sources of

finance for german development cooperation in the

water sector are grants and loans, including devel-

opment and promotional loans.�0

�0 Market funds as part of development loans, promotional loans and guarantees as well as investments at KfW Bankengruppe‘s own risk are only utilised in suitable cases.

these instruments

are flanked by appropriate measures for person-

nel support and management of the social envi-

ronment. investment financing can be deployed

as an incentive to drive forward sectoral reforms.

5.3.3 SupportforNon-Governmental

Organisations/Actors

Various civil society groups and organisations

are engaged in development cooperation at the

non-governmental level and implement projects

under their own responsibility.

Non-governmental initiatives play a particularly

important role in promoting broad public aware-

ness of the importance of water as a resource.

indeed, for many NgOs, the water sector has been

the key focus of their development policy work for

many years. the german government supports

this commitment in accordance with the criteria

governing cooperation with non-governmental

organisations.

the german government also supports direct

cooperation in the water sector between local

actors in partner countries and their counterparts

in germany.

��Water Sec tor Strategy

5.4 FieldsofAction

german development cooperation in the water

sector is guided by the main recommendations for

action adopted at the International conference

on Freshwater, held in Bonn, and the five “Bonn

Keys” which were identified by the conference as

priorities for the water sector:

1. The first key is to meet the water security

needs of the poor.

2. Decentralisation is key. The local level is

where national policy meets community

needs.

3. The key to better water outreach is new

partnerships.

4. The key to long-term harmony with nature

and neighbour is cooperative arrangements

at the water basin level, including across

waters that touch many shores.

5. The essential key is stronger, better per-

forming governance arrangements.

Source: InternationalConferenceonFreshwater

�001, Bonn, 2002.

efficient and productive use, equitable allocation,

conflict prevention and sustainable water resources

management are major challenges. in most coun-

tries, they require a radical rethink and often entail

the dismantling of obsolete structures. Develop-

ment cooperation can facilitate this process in vari-

ous fields of support and levels of intervention

through a variety of instruments. as a general rule,

individual interventions should be integrated into a

long-term aid strategy, which is agreed with part-

ners and harmonised with other donors. the tasks

of deciding on the individual fields of support,

drawing up a support strategy, identifying the

instruments to be applied and defining the level(s)

of intervention all take place on the basis of a com-

prehensive, iWrM-oriented analysis of the prob-

lems facing the partner country. achievable devel-

opment policy impacts, the significance and com-

parative strengths and weaknesses of german de-velopment cooperation, possibly divergent views

on the part of the partner institutions, and the acti-

vities of other donors all play an important role

when devising strategies and projects.

5.4.1 ReformingtheFrameworkConditionsin

theWaterSectorandWaterResources

Management

the development of an appropriate legal, institu-

tional and administrative framework for better

water resources management is relevant to all

the fields of action discussed below. this includes

advising the partner countries on the production

and implementation of environmentally sustain-

able, pro-poor water policies and sector strategies,

water master plans, sectoral investment plans and

reporting systems, the development of water leg-

islation and relevant by-laws and implementing

provisions, and the introduction and adaptation

of standards and norms.��

�� When introducing and developing norms and standards, the aim should be to link in with existing international systems of norms at an early stage.

Furthermore, ministries

and subordinate authorities of relevance to the

water sector often require support, while regula-

tory and water catchment authorities must be

developed and consolidated. Mediation bodies,

water committees and water parliaments can

contribute to conflict prevention and resolution.

Other bases for sustainable water resources man-

agement include the collection and evaluation of

hydrological and socioeconomic data, and here

too, development cooperation can play a role.

a clear division between policy formulation,

regulatory functions and service delivery reduces

the likelihood of inappropriate political influence

being brought to bear at any level and increases

operators‘ autonomy. this is facilitated by a

�� Water Sec tor Strategy

clear allocation of responsibilities among the

various institutions working in this sector and

by decentralisation of decision-making, powers

and finances in a manner appropriate to the

context and local capacities. effective regulation

of service delivery must be guaranteed, especially

in situations where natural monopolies exist. Pro-

fessional associations and similar participatory

institutions can make valuable contributions to

the further development of the water manage-

ment framework, e.g. in standard- and norm-

setting or in benchmarking processes.

transboundary water cooperation is very

important where water resources cross national

borders, the reason being that measures adopted

solely in one country generally cannot achieve

optimum benefits or may have negative impacts

downstream. Development cooperation can

promote international norm- and standard-set-

ting for transboundary water cooperation and

also provide management advice and specialist/

technical support for the relevant organisations.

international donor harmonisation is especially

important in funding infrastructural investment

in transboundary water catchment areas.

5.4.2 WaterforPeople:WaterSupplyand

Sanitation

a key field of action in the water sector is expand-

ing and safeguarding access to drinking water

and basic sanitation and introducing or improv-

ing wastewater management. Promoting waste

management measures is a complementary field

of action here.�2

�2 Here, see the BMZ‘s Waste Management Sector Strategy.

a particular priority is supporting sectoral

reforms, especially in the important but complex

process of improving corporate governance struc-

tures. good corporate governance must be based

on sufficient autonomy allowing public and

private utilities to operate economically. at the

same time, appropriate supervisory and control

mechanisms are required to guarantee adequate

transparency and accountability vis-à-vis users

and the state‘s supervisory bodies. establishing

better corporate governance structures is proving

to be a protracted process within a wider good

governance policy. thus the aim of cost recovery

in relation to water services can also only be

achieved progressively and over a number of

years in most developing countries.

Operator structures and qualifications have

emerged as a key issue. in combination with overall

improvements in corporate governance structures,

the provision of training and further education –

often in business management – for professionals

and managers is frequently needed. Private sector

involvement to support these processes may be

helpful if based on careful preparation, monitor-

ing and adequate diversification of risks.

in many cases, the very high investment costs asso-

ciated with drinking water and sanitation, espe-

cially in urban wastewater management, can only

be met through external financing. in urban areas,

such investments include the development, expan-

sion and upgrading of water supply, sanitation and

wastewater management systems. this entails a

careful appraisal of the suitability of alternative

standards and technologies and, if appropriate,

support for the introduction of new and adapted

technologies – especially decentralised systems –

for both drinking water and wastewater. the assess-

ment of alternative options must take account of

the target group‘s ability and willingness to pay,

operators‘ capacities and the local settlement geo-

graphy as well as sanitary, geological and hydro-

logical conditions, etc. appropriate funding mech-

anisms such as instalment payment schemes, sub-

sidies for connection costs and microcredit schemes

can help households cover the costs of on-site sys-

tems or network connections.


in rural regions, the task is to expand or renew

network-bound and non-network-bound water

supply and basic sanitation systems. Other acti-

vities are the development of self-government

structures on the basis of participation as well as

maintenance and repair systems, along with infor-

mation and awareness-raising for water users.

rehabilitating existing systems should generally

take priority over the construction of new systems

or expansion of existing ones. Drinking water

supply measures should generally be combined

with measures to improve sanitation. Where

possible and appropriate, closed-loop wastewater

and sanitation strategies should be applied.

the local service sector, including small-scale

industry and the informal sector, should be devel-

oped further wherever possible in the following

subsectors: water supply, sanitation, wastewater

treatment, and marketing of recycled products,

thereby creating jobs and income-generation

opportunities and making a significant contribu-

tion to improving supply.

the integration of information and awareness-

raising measures into the national primary edu-

cation system is a further element of a policy that

promises to achieve long-term improvements in

the hygiene situation.

5.4.3 WaterforFood

“Water for food” comprises all types of land use

which consume water for food production and

income generation. On average, around two -thirds

of precipitation evaporates or is held in soil and

used in situ by plants (i.e. green water), while just

one-third flows into blue water (rivers, lakes and

groundwater). increasing productivity in the use of

both these water resources is therefore important.

Key activities in this context are promoting greater

efficiency, productivity and output in arable and

livestock farming and forestry through better

water resources management. in this context,

improving rainwater harvesting takes priority

over the expansion of irrigated agriculture. in

irrigated agriculture, opportunities to improve

the efficiency of existing systems should be utilised

before new schemes are developed. Small and

medium-sized farms take priority over large-scale

irrigated agriculture when it comes to the alloca-

tion of funding. Safeguarding legal certainty in

relation to the cultivated areas is particularly

important when investing in irrigation systems.

Other key starting points for better water resources

management in arable and livestock farming and

forestry include access to resources and a balance

of uses/interests. Local self-help or community-

based programmes are promising approaches,

provided that appropriate framework conditions

are in place. traditional or socially adapted forms of

land-use and spatial planning offer an important

entry point for the development of rules, future-

oriented scenarios and paradigms and in setting

priorities for policy-makers, research, advisory

services and funding agencies.

Particular account must be taken of the water

access needs of small family farms. Water law

issues should therefore be given appropriate con-

sideration in the context of agricultural reforms

and land allocation/redistribution.

5.4.4 WaterforEcosystems

in many partner countries, ecosystems currently

lack adequate protection, partly because their

benefits for water supply, flood protection etc. are

often underestimated. Often, irreversible or costly

environmental damage occurs because preserv-

ing these ecosystems has not been adequately

integrated into management planning in the

water sector or in general economic and environ-

mental policy. Yet in many cases, the targeted pro-

motion of ecosystems in a manner appropriate to


the natural geographic region offers viable solu-

tions, e.g. for water retention and filtration, within

the framework of a holistic water sector policy.

Water-related development cooperation can pro-

mote the protection and development of these

ecosystems through a variety of measures, e.g.

through regulation, the designation and estab-

lishment of protected areas, conditions of use,

mediation schemes and conflict resolution mech-

anisms, financing of incentive schemes and com-

pensation measures, development of monitoring

procedures, combating erosion, afforestation,

and catchment management. Mechanisms for

transfers from the beneficiaries of water-related

environmental services (e.g. erosion protection)

to the providers (payment for environmental

services, PeS) can contribute to the sustainable

protection of ecosystems in some cases.

“The concept of payments for environmental serv-

ices (PES) has received substantial interest in recent

years as a way of creating incentive measures for

managing natural resources, addressing livelihood

issues for the rural poor, and providing sustainable

financing for protected areas. The basic idea is

that those who “provide” environmental services

by conserving natural ecosystems should be com-

pensated by beneficiaries of the service.”

Source: PaymentsforEnvironmentalServices,

World Wide Fund for Nature, gland (Switzerland),

2006.

For our partners, the right to water also creates an

obligation to conserve scarce water resources for

future generations. its implementation requires

close interaction with the local population, along

with information, awareness-raising and partici-

pation on the basis of ownership. as water resources

are in some cases exported by partner countries

to industrialised countries as virtual water, these

latter countries also – ideally – have an interest in

supporting sustainable water resources manage-

ment in the relevant products‘ countries of origin.

5.4.5 WaterforOtherPurposes

this field of action focusses especially on water

usage in industry and energy production. in

numerous partner countries, wastewater from

industry flows untreated into the drainage systems

or into natural waterways, causing severe and

often irreparable damage to human and animal

health and the environment. Here, development

cooperation can provide investment incentives for

industrial wastewater pre-treatment systems, for

example, or support the introduction of water-sav-

ing production processes. Financial resources are

also provided for environmental funds which assist

companies to pay for environmental investments.

Development cooperation can also provide fund-

ing for systems that promote the environmentally

and socially compatible use of hydropower, tak-

ing account of the criteria for dams mentioned

below. in this context, priority is given to run-of-

river power stations and small-scale dams for the

local energy supply.

5.4.6 SpecialAreas:

FloodManagementandDams

Flood management is becoming increasingly

important in many countries. in the wider con-

text of disaster reduction, the negative impacts

of flood events can be mitigated or averted by

means of afforestation and erosion protection

measures, improvements in rainwater drainage,

reactivation or creation of floodplains, and ripar-

ian and coastal protection. regulatory measures

in the field of spatial and regional planning,

along with technical flood protection measures,

make a contribution here. the establishment of

early warning systems – especially for poor popu-

lation groups who are at greatest risk – makes an

important contribution to reducing vulnerability

and minimising flood damage.


The WCD report��

�� the World commission on Dams (WcD) was an independent interna-tional commission which was established at the initiative of the World Bank and the IUcN. From �998 to 2000, the WcD reviewed the devel-opment effectiveness and negative impacts of large dams and devel-oped criteria on the planning, design, construction, operation, moni-toring and decommissioning of large dams.

is a milestone in the evolution

of dams as a development option. The debate

about dams is a debate about the very meaning,

purpose and pathways for achieving development.

Through its Global Review of the performance of

dams, the Commission presented an integrated

assessment of when, how and why dams succeed

or fail in meeting development objectives. This

provides the rationale for a fundamental shift

in options assessment and in the planning and

project cycles for water and energy resources

development.

The Commission‘s framework for decision-making

was based on five core values-equity, sustainabil-

ity, efficiency, participatory decision-making and

accountability. It proposed:

l a rights-and-risks approach as a practical and

principled basis for identifying all legitimate

stakeholders in negotiating development

choices and agreements;

l seven strategic priorities and corresponding

policy principles for water and energy re-

sources development-gaining public accept-

ance, comprehensive options assessment,

addressing existing dams, sustaining rivers

and livelihoods, recognising entitlements

and sharing benefits, ensuring compliance,

and sharing rivers for peace, development

and security; and

l criteria and guidelines for good practice

related to the strategic priorities, ranging

from life-cycle and environmental flow as-

sessments to impoverishment risk analysis

and integrity pacts.

Source: DamsandDevelopment:ANewFrame-

workforDecision-Making. overview, World com-

mission on Dams, London, 2000.

the construction of large dams is a controversial

issue worldwide. Due to the often negative

impacts on the ecobalance and the communities

affected by resettlement, the issues of sustainabil-

ity and human rights compatibility must be give

particularly careful consideration in the context

of dam construction. Dams can provide solutions

for energy production, irrigation, drinking water

supply and flood protection. However, dam con-

struction projects must always be contingent on a

comprehensive evaluation of alternative options

and must satisfy sustainability criteria. Often, the

rehabilitation of existing dams is a better option

than new construction. Large dam projects must

satisfy the World Commission on Dams criteria

for planning, implementation, construction and

operation; these criteria should also be applied

accordingly to smaller dam projects.

Published by the

Federal Ministry for Economic Cooperation and Development

Bonn Office Postfach 12 03 22 53045 BonngermanyPhone: + 49 (0) 228 99 535 - 0Fax: + 49 (0) 228 99 535 - 35 00

Berlin Office Stresemannstraße 9410963 BerlingermanyPhone: + 49 (0) 30 18 535 - 0 Fax: + 49 (0) 30 18 535 - 25 01

[email protected]

Editor-in-chief Martin Kipping, Kirsten Doelle, anja BentlageFinal editing Jutta WagnerOfficials responsible Dr. Manfred KonukiewitzAs at September 2 006

mailto:[email protected]

http://www.bmz.de

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