Water Finance in the Mediterranean: Increased Policy Dialogue, Stakeholder Engagement, Technical Support, and Project Planning Are Essential for a Robust Mediterranean Water Sector

23/03/2023

The 43 member states of the Union for the Mediterranean (UfM), which includes countries from the European Union, South Eastern Europe, Western Asia, and North Africa, are cooperating to develop and implement a regional response to the water crisis. Following the mandate of the 2017 UfM Ministerial Meeting on Water, they developed in 2018 the UfM Water Agenda and the UfM Financial Strategy for Water. This Strategy, organized around 3 pillars and 10 objectives, presents a menu of 47 options to enhance the financial sustainability of water management in the Mediterranean. The responsibility for implementing the UfM Financial Strategy for Water stays with individual UfM member states, while the UfM Secretariat carries out a programme of activities to facilitate its uptake.

The UN 2023 Water Conference provided a timely opportunity to share with other regions the progress made by UfM member states in enhancing the financial sustainability of water management, reflect on how their efforts could be more effective and efficient, and re-affirm their commitment to continue to implement the UfM Financial Strategy for Water. On the 23rd of March a special session titled " Water Finance in the Mediterranean" was organized by: UfM, the European Commission, the Ministry of Water and Irrigation of Jordan, the Ministry of Agriculture and Forestry of Türkiye, the Ministry of Equipment and Water of Morocco, Ministry of Foreign Affairs of Finland, OECD and EIB.

Key recommendations for action from this session included the following items:

• At the national level, better balance the focus on new projects with more attention to improving policy frameworks. Currently, too many projects are delayed or fail. The Mediterranean water sector needs more policy dialogue, technical assistance, and project preparation; as well as better engagement of all actors (including private banks and the private sector more generally). Partners are ready to support this agenda through water-related initiatives such as the Blue Med Partnership involving EBRD, EIB, and UfM, and the OECD scorecard for assessing enabling conditions for water

finance.

• At the regional level, update the UfM Financial Strategy for Water and deepen experience sharing to support improved national water finance frameworks. The agenda set out by the UfM Financial Strategy for Water remains relevant, but more attention could be paid to reforming subsidies that have a negative impact on water (moving away from funding misdirected and anti-resilient activities), strengthening economic regulation (to support tariff reform, better performance standards, and improved creditworthiness), and improving enabling conditions. Countries around the

region are trying out different solutions that could be better shared.

inter-Regional Technical Platform on Water Scarcity (iRTP-WS)

Water Finance in the Mediterranean: Increased Policy Dialogue, Stakeholder Engagement, Technical Support, and Project Planning Are Essential for a Robust Mediterranean Water Sector