State Secretary Olav Kjørven

Water related issues in Norwegian development policy

University of Bergen, 24 September 2002

Introduction

The point of departure for this presentation is the fact that 500 million people throughout the world lack access to safe drinking water and 1.2 billion people do not have access to basic sanitation. Think for a second what this means. We are talking about staggering figures and shocking realities of suffering and unnecessary death.

The Norwegian Government is, thus, pleased that the Johannesburg summit reaffirmed the eight UN Millennium Development Goals, and incorporated these into the Plan of Implementation adopted in Johannesburg. In the area of water and sanitation this means that the explicit Millennium Goal of halving the proportion of people without access to safe drinking water and access to sanitation by 2015 was reaffirmed as a global target.

But can these goals be achieved? Our goals will at least require huge investments in infrastructure. And there is also another question of where sufficient water resources are to be taken from, when we know how inequitably water is distributed today globally, regionally, nationally and locally. It is obvious that development co-operation alone cannot resolve these problems, it can only act as a catalyst for change in the hopefully right direction.

In my presentation I will first outline some challenges, the way we see it, involved in achieving the global goals in the area of water and sanitation. The second main part will deal with the role of private sector investments in the area of water. Thirdly I will address the conflict potential related to water resources. Fourthly, I will speak about what Norway is doing internationally in this sector - as an active participant in international processes and as a major contributor to international development co-operation.

1. The main challenges ahead

Water management strategies must give priority to the fight against poverty and benefit the poor. There have been long discussions in the Commission for Sustainable Development and other fora on the "right" to water, and it is an important principle that people have a right to water supplies that satisfy their basic needs, at a price they can afford. "Equitable distribution" and "fair price" are important concepts here. But the right to have one’s basic needs satisfied is not the same as the right to free water. Water and water supply services must be correctly priced to ensure that water supplies are used in a way that will benefit society to the greatest possible extent. At present, many countries with limited water supplies use much of their water for agricultural purposes, at a price that does not reflect its value. In addition, alternative uses would in some cases result in much more value creation for society.

The greatest problem is that a larger and larger proportion of the world population does not have satisfactory access to clean drinking water. The issue of subsidies is an important one. At present, it is often the better off who have supplies of subsidised drinking water, while people in slums and outside urban areas pay far more. We can support the use of subsidies and user-fees etc. in the water sector provided that they are targeted towards the poorest groups and the system of subsidies is transparent. Most important, the system of financing water must be structured in such a way that it facilitates the extension of safe water to those in need of it.

We could say much more about other aspects/challenges when it comes to targeting poverty through water-related investment programs. However, let me turn now to some other challenges, though very much related to poverty.

Efficient co-ordination at the global level is another major challenge if we are to reach out to the poor.

There are currently many international institutions and programmes that address issues related to water resource management. There is no single body, however, that has the overall responsibility for co-ordinating and supporting the work that is already being done to make water management more sustainable. This has to be resolved if we are to achieve our goals.

As it is organised currently, water-related issues is part of the agenda for a variety of different UN organisations and programmes:

WMO: water data collection, monitoring, and forecasting.

UNESCO: water research and education, and awareness raising.

FAO: irrigation technology, and plant selection.

UNIDO: efficient industrial water use.

WHO: fighting water-related diseases.

WHO, UNDP and UNICEF: urban and rural water supplies and sanitation.

management infrastructure, capacity building and legislation are the responsibility of several agencies, including the World Bank, UNDP, and UN Economic Commissions.

UNEP: water quality assessment.

Financial institutions, regional economic organisations (the EU, NAFTA, ASEAN, SADC and others) and co-operation networks and associations also address water issues. The World Water Council, the Global Water Partnership and the Water Supply and Sanitation Council have made very important contributions in terms of both water policies and action plans.

Closer co-ordination of the work of all these bodies is needed to improve their efficiency and achieve significant results "on the ground". Co-ordination is also needed between the UN, international finance institutions, NGOs and other actors in civil society as for instance the work done by the World Commission on Dams.

In all this the UN should take the leading role.

In addition to the poverty dimension and improved co-ordination at the global level, the third main challenge is related to adequate funding.

2. The role of private sector investments

It is estimated that globally, investments of about USD 180 billion a year are needed in water supplies, water purification and irrigation systems to meet the needs of the world’s population. The current level of investments is estimated to be about USD 70-80 billion a year. It is obvious that it will be very difficult for developing countries to invest enough in the water sector. At the International Conference on Freshwater in Bonn in December almost a year ago, African ministers responsible for water resources issued a joint declaration that underlined the need for new financial resources for investment in the water and sanitation sector in developing countries.

There was general agreement at the Bonn conference that the gap between the funding available in the water sector and what is needed is too great for it to be met by the public sector on its own, even in industrialised countries. The conference discussed various schemes for public- and private-sector financing. But when new actors become involved, the question arises of what role the public and private sectors should play in the water sector.

The role of the private sector in water projects must be further discussed. The water sector must generate revenues for its own operation and necessary investments. This is an issue where there is disagreement between donor and recipient countries. The latter fear that stressing this may draw attention away from the need for outside funding, while donor countries believe that more funding can be generated outside development co-operation budgets by means of realistic pricing mechanisms, and that this need not happen at the expense of poorer groups. This discussion is related to the role of the private sector, both as a source of funding and as a water supplier. Several developing countries would like to have access to modern technology without paying for it, for example to technology that is in the public domain.

There are large differences between investments in water supplies and sanitation in urban and rural areas. In urban areas, it is assumed that larger part of the population can pay for water according to their means. There are mechanisms for levelling out differences between groups, by for example using subsidies or taxes. Similarly, it is possible to subsidise rural areas or transfer funds from urban to rural areas.

The balance between the public and private participation in the water and sanitation sector is perhaps the dominant faultline in contemporary debates. The key issue is being the balance between private sector efficiency and public sector enforcement and regulation.

ODA funding can only be a supplement to private-sector funding and can be used to develop mechanisms that will encourage investment. These may range from drawing up legislation and guidelines to strategies for providing water supplies, licensing procedures, negotiation techniques, and so on.

Efficient and sound management of water resources requires many elements to be in place, including properly-functioning institutions, human and technological resources to deal with data collection and processing and with planning, and a legislative framework for co-operation among the relevant entities—be they different ministries or municipalities, utilities, etc. It is of fundamental importance that the regime for managing the water resources is based on a thorough understanding of the ecological dimension to managing water on a sustainable basis.

3. The international conflict potential

Water conflicts between states are generally political and are resolved by diplomatic means. In addition, potential conflicts are regulated by bilateral and multilateral agreements. However, such conflicts can have serious negative consequences because they may prevent people from making use of economic opportunities. I need only mention the Nile and the states along it, and the lack of opportunities to make use of the water further upstream for hydropower production and irrigation, for example in Ethiopia. Egypt has threatened to go to war if necessary to protect its water supplies.

Without adequate fora and mechanisms to resolve conflicts involving shared river basins, this may become one of the most serious problems of this century. Some people have even claimed that conflicts over water will be a dominating factor in international relations in the years ahead. We must try to anticipate such conflicts and develop mechanisms to resolve them.

The key to good solutions is to deal with the underlying problems – lack of water, inequitable distribution of water, deterioration of water quality, over-use and pollution of water resources. Solving these problems needs our attention at local, national, regional and global level. Some progress has already been made in determining the course of future efforts.

The distribution and use of water have become an important economic, social and political issue. This is clear if we consider examples such as the conflict between Israel and the Palestinians, the disagreement between Turkey, Syria and Iraq over the Tigris and Euphrates, and the longstanding disagreements between Egypt, Sudan and Ethiopia over the use of the water from the Nile. The Mekong River represents another challenge as China is looking for ways to utilise more of the water on its side of the border for various development needs. The Indus has paradoxically enough been a very good example of conflict resolution over water resources, between countries that are normally very much at odds.

The entry into force of the UN Convention on the Law on the Non-Navigational Uses of International Watercourses shows that the need to provide a framework for orderly international processes to deal with international water issues has been internationally recognised.

Conflict resolution is of central importance in most development co-operation in the water sector, since all allocation of water supplies involves conflicts of interest between users. A country or region must manage its water resources in a way that resolves conflicts between user groups, for example when dealing with hydropower development, allocating scarce resources to agriculture, industry and towns, deciding on the location of wells in rural areas and in many other contexts. Development co-operation can be used to provide both funding and expertise to solve some of these problems.

Most conflicts over water occur within countries. Different communities, ethnic groups or interest groups with growing needs compete for the same limited water resources. In addition, the environment itself has become a party to these conflicts. Environmental protection groups are now fighting to protect water bodies so that ecological systems and animal and plant communities can be maintained. These communities definitely need a voice in the sharing of water resources.

Conflicts of this kind are generally political rather than violent, but can be serious even so. Sometimes they last for many years and prevent economic development. They are normally dealt with through political or administrative channels, but if a government fails to act, open conflict may erupt.

Vulnerable groups such as the poorest segments of the population and ethnic minorities and indigenous people are often the first victims, since they are least able to protect their own rights and interests. Sometimes, a conflict can only be resolved when one or more parties have already lost: for example, if access to sufficient quantities of clean water is permanently destroyed or whole communities are forced to move. This has happened in parts of Nigeria’s coastal zone, where oil is produced. In some cases, governments and the groups affected manage to negotiate acceptable solutions.

There is considerable international co-operation on transboundary river basins and aquifers. In many cases, Norwegian interests are represented too. Many countries share some important river basins and lakes.

For example, ten countries share the Nile, including Burundi, DR Congo, Egypt, Eritrea, Rwanda, Sudan, Tanzania and Uganda. The river basin is in a region of extreme poverty, instability, rapid population growth and serious environmental problems. Half of the countries in the Nile basin are among the poorest in the world. There is only limited infrastructure linking these ten countries. At the same time, the Nile is rich in potential: south of Aswan, it is one of the world’s least-utilised rivers. Co-operation on its management offers many opportunities for win-win situations for the countries of the Nile, but serious environmental conflicts can also arise, as we have seen in the Sudd area in Sudan. The University of Bergen has made important contributions to understanding the Nile, so to speak or rather the dynamic relations between peoples and the river.

Lake Victoria covers an area of 69 000 km ²>, and its drainage area covers 184 000 km ²>. It provides a life-support system for millions of people. It is the world’s second largest lake, and has a unique ecosystem, with huge biological resources. The lake is shared between Kenya, Tanzania and Uganda.

Lake Malawi is the southernmost lake in Africa’s Rift Valley, and is also one of the largest lakes in the valley. It is shared between Malawi, Mozambique and Tanzania, and is fed by 13 rivers that drain a catchment area of 75 000 km ²>. It is important for the livelihoods of the people living around it.

The Mekong River rises in the Himalayas and flows eastwards and southwards before forming the border between Myanmar and Laos. After this, it becomes the border river between Laos and Thailand, and flows through Cambodia and finally to its delta in southern Vietnam. The river basin covers parts of China, the whole of Laos and Cambodia, almost all of Vietnam and about half of Thailand. The Mekong is 4 800 km ²> long, making it the twelfth longest river in the world and the eighth in terms of discharge volume, carrying 475 million m ³> of water a year. Co-operation in the Mekong basin is based on a convention adopted by Laos, Myanmar, Thailand, Vietnam and Cambodia. There is an obvious problem here: China is not party to this convention.

Transboundary river basins and aquifers offer unique opportunities for co-operation, and we consider it important to make use of these opportunities. But at the same time, water resource management and water-related conflicts are very complex issues involving many development and foreign policy issues. It is advisable to develop a water management policy intended to resolve conflicts in a region gradually before interventions are made. Norway has for example supported the Nile Basin Initiative, which has helped to encourage co-operation between countries in a watershed where there has been serious conflict over water resources. There is often a high risk of conflict where countries with limited water resources share river basins or aquifers. We should try to resolve such conflicts in a way that creates "win-win" situations, so that more than one party gains a "development dividend" from development projects, clean-up operations, or water sales.

Developing countries themselves must share responsibility for and feel a sense of ownership of co-operation mechanisms. For example, in the Water Supply and Sanitation Collaborative Council, Norway has supported the Africa group, which is organised by African countries and has drawn up many important principles and proposals that have been used elsewhere.

We have seen time and time again that if national administrative bodies do not have enough experience and expertise to carry out overall analyses and planning and implement integrated management systems, they will not be able to cope with regional co-operation on shared water resources, whether these are rivers, lakes or aquifers. It is therefore essential to build up expertise in these matters, and also to promote an atmosphere that enables different expert groups to work together and to develop confidence in each other. In many countries, there is still a long way to go before agricultural experts trust engineers to take their interests into account.

4. Norwegian policies

There are two main avenues through which Norway channels its international efforts in the area of water. One is our participation in international processes. The second is our development assistance.

4.1. International processes

Norway has been active in the Commission on Sustainable Development, which laid down the general principles of strategic approaches to freshwater management for the international community.

There have been a number of conferences on issues relating to freshwater. The World Water Council, an association of expert and professional organisations in the water sector, was established in 1996. It arranged the first three-yearly World Water Forum in Egypt in 1997. The Council also drew up the World Water Vision, which was used as a basis for the second World Water Forum in The Hague.

The Ministerial Declaration on Water Security in the 21 ^st> Century adopted in The Hague in March 2000 called on "the Secretary General of the United Nations to further strengthen the co-ordination and coherence of activities on water issues within the UN system". This call was reiterated in the Ministerial Declaration from the International Freshwater Conference held in Bonn in December 2001.

At the Bonn conference, it became quite clear that all aspects of water issues have been thoroughly discussed by the international community, and that there is general consensus on the principles of sustainable water management and on targets. The problem is to put all this into practice.

UN Secretary-General Kofi Annan as part of the preparations for the Johannesburg summit launched the WEHAB initiative. It focuses on five strategic sectors for achieving sustainable development: water, energy, health, agriculture and biodiversity. It will be an important part of the follow-up to the Plan of Implementation from Johannesburg. It also includes a range of targeted activities that follow up the Rio conventions.

The Johannesburg summit agreed to launch a programme of actions to achieve the goals for water and sanitation. Norway strongly supported this initiative. The new element was really that a clear target on sanitation was brought into the equation. This is in itself an important step in the right direction. For too long, the issue of providing water—the input side—has been pursued without appropriate attention to the question of how to deal with the output side, to put it that way.

4.2. Development approaches to increased access to water

However, there are differing views in some areas on how we should proceed. The most important issues are:

the overall orientation of our work in relation to water must be targeted towards poverty alleviation

with regard to funding, investigate where requirements for profitability in the water supply sector can come into conflict with social considerations

the water needs of the agricultural sector, where there can be conflicts between the need for water, food security and profitability

there is growing recognition that the key ecological functions of forests, wetlands and stream must be maintained in order to secure stable and safe water supplies for people

developing methods for the peaceful resolution of international water conflicts

allocation of responsibilities at national level and between international bodies

the importance of women’s participation in decision-making processes and management still tends to be overlooked.

There can be no sound development without better access to water in developing countries. Norway’s role is to encourage the development of integrated water resource management in a development context. For example, by offering to share the expertise we have built up in the development of legislation, planning, and management at national and local level. Further we can provide decentralised environmental management and technology for water conservation and re-use.

Previously, Norwegian development co-operation in this sector has focused on infrastructure, including drilling for water, pipeline construction, dam construction and so on. We are now focusing increasingly on the scarcity of water, water as a global public good and water as a basis for human activity in every country. Water is already and will continue to be a resource that can lead to conflict between countries and population groups, but we will also be forced to co-operate on its use.

Norwegian development co-operation in the field of water has changed with the changing role of water management bodies in developing countries. In the 1960s and 1970s, the highest-priority tasks were developing water supplies and infrastructure for towns and new industrial developments. In the 1980s, there was a gradual shift of emphasis to building up central and local administrative bodies to enable them to deal with distribution and supply problems both in rural areas and in towns.

In the 1980s, everyone involved in the water supply sector faced a steep learning curve. During the International Drinking Water and Sanitation Decade, various facts were recognised that many governments in developing countries found difficult to accept:

Water users must be involved in decision-making, and women are important partners.

Water users must own water supplies, and can be responsible for operating pumps and wells themselves.

Private contractors are often able to carry out development projects and operate supply systems better and more cheaply than administrative bodies.

Water is an economic good and must be priced in a way that reflects its value to society.

Norway’s partner countries have through the 1990s focused increasingly on governance, integrated planning and co-operation with neighbouring countries on the distribution and sharing of joint water resources, and as a result, the approach taken by Norwegian development assistance is also changing. There is today more emphasis on recipient responsibility for planning and implementation, less emphasis on details, and more support for administrative bodies in recipient countries.

Decentralisation is particularly important both for sustainable development and for the democratisation process. Many local authorities in our partner countries have made use of the water sector in pilot projects on decentralised administration and cross-sectoral planning.

Integrated management of a resource like water, where so many sectoral interests are involved, is not easy. Existing administrative boundaries and responsibilities need to be rethought, and management structures need to be adapted to river basins and aquifers. In addition, legislative reforms are needed to restrict ownership rights to water. Many countries lack the political stability needed to resolve difficult conflicts over natural resources.

Transparency is essential in development co-operation in the water and sanitation sector. There have been too many corruption scandals in connection with investments in water supplies and sanitation for donors to be willing to provide funds without an assurance that processes and transactions will be transparent. However, donors also have an obvious responsibility in this regard.

Transparency is also essential for the private sector. The public sector must therefore provide a suitable framework for private financing of water supplies, purification and so on. Developing countries particularly need assistance in drawing up legislation and developing licensing procedures, and in negotiations. The goal of private-sector funding will always be to achieve a return on investments. During the Bonn conference, it was stressed that the private sector does not necessarily have to "own" water sources and infrastructure. Private-sector investments must be based on ethical principles and a clear and stable legal and regulatory framework must surround them. The perception that an investment is "safe" is extremely important. If a developing country invites private-sector participation in the water sector, the government must ensure that private companies can feel confident that their investments are later not confiscated or annulled. Or that laws or regulations are not changed arbitrarily or overnight. Unless these conditions are met, few worthwhile firms will want to invest. At the same time, it is equally clear that the private firms themselves also must abide by the rules, and be very sensitive to social and ethical issues.

We consider ecosystem planning and integrated management regimes to be essential. Integrated management regimes are needed to regulate the use of water, taking into account people’s basic needs, the needs of industry, agriculture and the environment itself, and considering the entire water cycle, from the protection of water sources to dealing with waste water and the run off in the coastal zones.

THE NEED FOR ACTION

The challenge of managing water resources effectively and sustainable is a daunting one. The task will require new initiatives and probably a stronger focus on international co-operation than we have seen so far.

We need to build partnerships of committed individuals, groups and institutions, to identify solutions and to create the necessary public support for transforming them into reality.

The primary responsibility for ensuring equitable and sustainable management of water resources rests with national governments. In the case of transboundary water resources, international co-operation based on the principle of integrated water resource management and a basin-wide approach should be encouraged.

The international community has a special responsibility to mobilise the political will to take action and to provide technical and financial support to countries that need it. Support should be provided on the basis of the developing countries’ own priorities and should be properly co-ordinated.

We will not be able to achieve our goals in the area of water unless we base our action on knowledge and scientific data. This is where you come in. A centre of excellence, such as the Centre for Development Studies in Bergen is an example of a supplier of such knowledge and competence. In addition this very Center has proved its commitment to development studies through its long-standing research collaboration with partners in the south. The Norwegian government has benefited from the knowledge generated from this collaboration in the past, and it will continue to do so in the future.