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OECD: Corruption costs water sector €66 billion a year

Sustainable Dev.

OECD: Corruption costs water sector €66 billion a year

Providing clean water is inextricably linked to numerous other factors, especially climate change.

[Jon Gloser/Flickr]

Water is arguably the world’s most precious, if not always most expensive, resource. The OECD is looking to prioritise cooperation between sectors and new forms of financing. EurActiv’s partner El País – Planeta Futuro reports.

Aziza Akhmouch is the head of the water governance programme at the Organisation for Economic Co-operation and Development (OECD).

Akhmouch spoke to El País – Planeta Futuro’s Tiziana Trotta.

What obstacles stand in the way of the Sustainable Development Goal (SDG) on water by 2030?

We learned from the Millennium Development Goals (MDGs) that the necessary technical solutions and financial resources are there, but are scattered about. The main problems that we identified between 2000 and 2015 were implementation, coordination between local authorities, assessing results, accountability, monitoring and evaluation… The matter of deciding how and with whom to do something is more relevant than the policies themselves in achieving the objectives and securing financing.

Are we facing a resources problem as a result of population growth or crisis of governance?

Both. Many OECD countries, including developed ones, are facing complex challenges because of the economic crisis, such as renewing obsolete infrastructure. This requires new financing initiatives: new taxes, private sector participation or crowdfunding.  We have to leave behind this idea that the state is responsible for managing everything.

How is collaboration between the public and private sector going to work?

The notion that the private sector is taking over is completely wrong. About 90% of the world’s population has access to clean drinking water because of public management. Additionally, the way in which private actors operate has changed. Instead of lobbying for contracts that last 25 or 30 years, which carry a lot of political and financial risks, now they prefer projects that transfer knowledge and technology, rather than financing infrastructure. This is because it is unknown whether there will be sufficient stability for them to recuperate their costs.

Most of these operators now participate mostly in debates and decision-making on how to allocate these resources. The OECD is not going to tell a country to go cap in hand to the private sector, but if it did, good governance principles would apply. And even if we did want to impose a particular option, it would be impossible, due to the diversity between our members and the fact that it is not a question of public or private sector: it’s about how the sector is regulated.

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Does international cooperation on water need to be improved?

The SDGs already offer a vision of international cooperation, in which all the participating countries will work towards the same goals.

Do you think water policies don’t pay enough attention to similar sectors, such as food security?

In most countries, 70% of water consumption is taken up by agriculture. That relates to food security and other major challenges, including reducing pollution of ground and surface water. It’s not just about agriculture: we’re talking about energy too. Brazil, for example, has about 12% of the world’s water resources and is currently in the midst of a crisis.

Another area of interdependence is territorial development. In the Netherlands, two-thirds of its territory is below sea level, so any new urban builds have to take into account flood protection and prevention. There are many cases in which decisions are made without the involvement of the water sector, but which have an impact on it.

Are less developed countries ready to deal with the challenges posed by extreme weather?

Around 70% of climate change’s impact hits the water sector and 90% of natural disasters are linked to it. The link between climate and water is accepted by most experts, but there is still a lot to be done. For example, the Paris agreement made no reference to water. The OECD noted in 2005 that Finland was the only country to establish a national plan to adapt to climate change. Today that number is 16. Bangladesh and the Maldives are among the most vulnerable countries. In a few decades, they could be swallowed up by the ocean if the right decisions aren’t taken. Part of the work involves building infrastructure to protect themselves and another is optimising rainwater collection.

How can economists address problems linked to water?

For the last two or three decades, the OECD’s attitude to this has been “putting a price on water does little to solve the problem”. In 2006, Ángel Gurría, our current Secretary-General, insisted that the economy is not the solution to everything and that more multidisciplinary work would have to be done to understand political barriers, financial flows and governmental obstacles.

This constituted a shift in message of the organisation, emphasising that the economy was no longer the be-all and that it would be more about involving people, places, policies and coordinating different areas. According to the latest Global Water Integrity Outlook, corruption is responsible for $75 billion in losses for the sector. The OECD works to establish indicators that allow the impact and outcomes of policies to be recorded.  Putting a price on water, without a contextual framework, doesn’t achieve much.

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What impact are water policies having on gender issues?

It’s been shown that inclusive policies generate economic benefits. The way to approach this is first to show demonstrate that this is not just a social issue, but an economic one too. The second thing consists of replicating success stories in other areas.

El País - Planeta Futuro