Water financing and governance

This paper focuses on the need to fund the water resources functions that are essential for security and sustainability and to examine the relationship between the different governance and organizational structures in the sector and their ability to secure funding for essential goods and services. It aims to bring together these different strands so that a more coordinated, coherent approach to water financing is adopted. The Camdessus Report in 2003 and the Gurria report in 2006 have prompted a wealth of interest in water financing. Commentators, however, stress that financial needs will not be met without major reforms in water governance. By improving water governance the enabling environment for investment will improve as risks, commercial and political, will be better understood and addressed. Over the last fifteen years an integrated approach to water resources management (IWRM) has evolved as the means to manage water more holistically and sustainably, and overcome the fragmented decision making and purely supply side approach common to the past uses and abuses of water resources. There is a very close link between the integrated approach, good water governance and financing but, to date, there has been little discussion about this relationship.