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Joining Forces: Enhancing Transboundary Water Cooperation and Investments across the World Bank

JOINING FORCES

Enhancing Transboundary Water

Cooperation and Investments across

the World Bank

Over half the world’s population lives in transboundary Innovative Financing for Transboundary
basins, but only 43 of 153 countries that share transboundary Water Investments
waters have operational agreements for at least 90 percent
of their shared rivers, lakes, and aquifers. With climate change, The Global Facility and the World Bank’s 2030 Water Resources
growing populations, and improving livelihoods increasing Group together are catalyzing private sector engagement
the demand for scarce water resources, transboundary and innovative financing design for transboundary water
cooperation and investments are needed more than ever. investments. They are developing a global engagement on
Innovative Financing for Transboundary Water Investments, which
To address these challenges, the World Bank established the will support the identification and mobilization of new financing
Global Facility for Transboundary Water Cooperation in 2023 solutions at the basin scale, including in the Okavango Basin
as an initiative of the Global Water Department. and to the OMVS. CIWA is also having discussions with basin
organizations on how to increase CIWA’s engagement in finding
“Given that water is such an essential resource for human life, innovative financing sources, including supporting the preparation
the economy, and jobs, the resource needs to be managed of a new Global Environment Fund-supported program for the
sustainably and ideally through cooperation between Okavango Basin to capacitate and operationalize its CORB Fund,
countries,” says Global Facility Program Manager Christina Leb. allowing it to move toward being a financial institution. The
overall effort is assessing investment needs and the revenue-
She says the Facility’s mission is to provide technical generating potential of such investments to gauge where public,
assistance, capacity-building, and support to identify concessional, donor, and private capital may be deployed. It is also
investment opportunities for countries and to ensure that exploring the interlinkages of water with other sectors for tangible
transboundary water resources remain at the forefront of development impact (e.g., food, livelihoods, energy security) to
the international agenda, including by convening global fora. enhance the business case for additional finance mobilization in
the transboundary context.
The Facility closely coordinates its work with CIWA to bring
knowledge from CIWA and the African river basins to other Figure 1 shows that investments that are high revenue‑generating
regions and vice versa. and require large‑scale financing are the best candidates to
attract private capital. Such investments typically also encompass
With support from the World Bank’s Global Water Security multiple sectors beyond water, for example, multi-purpose storage,
& Sanitation Partnership, the Global Facility’s first Bank‑ ecotourism infrastructure development, and hydropower.
executed grant is to the Amazon Cooperation Treaty
Organization to improve water‑quality monitoring and build This work explores a continuum of financing solutions, ranging
capacity. Its planned second grant will be to support the OMVS from performance-based grants and sustainability-linked loans
on innovative financing for transboundary water investments to insurance products, contingent financing, bond options, and
and reform of its financial structure to leverage additional capital. pooled regional funds. It is also examining options for donors to
Support to OMVS on innovative financing will complement CIWA’s support transboundary financing through performance-based
assistance to SMAB development and the DREVE program. grant provision, payments of interest buy-downs on sustainability-
linked loans, and insurance premiums for disaster risk coverage.

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