MIDDLE EAST AND NORTH AFRICA (MNA) REGIONAL WATER INITIATIVE MIDDLE EAST AND MEDITERRANEAN REGIONAL DAY KYOTO, JAPAN, MARCH 2003 Moving from Scarcity to Security through Policy Reform 28307 t~~~~~~~~~~~~~~~~~~~~~~~~~~~~- .04 - : It SUMMARY REPORT The World Bank Wor e Wadter Coonc The Wotid Bank " S FILE C O P 3rd World Water Forumr MIDDLE EAST AND MEDITERRANEAN REGIONAL DAY MOVING FROM SCARCITY TO SECURITY THROUGH POLICY REFORM KYOTO, JAPAN, MARCH 20, 2003 SUMMARY REPORT JUNE 2003 Sponsored by: The 3rd World Water Forum Secretariat The World Bank - Middle East and North Africa Region Table of Content Page FOREWARD .iii ACRONYMS .................................................................. iv SUMMARY OF THE REGIONAL DAY Section I. INTRODUCTION. 1 II POLICY REFORMS: CHALLENGES AND ACHIEVEMENTS 5 2.1 Water: A Critical Issue in the Region. 5 2.2 Water Policies: Key to Development and Reducing Poverty, presented by Mr. Peter Woicke, Executive Vice President, The World Bank. 9 2.3 Resolving Scarcity Problems through Reforms. 9 III. POLICY REFORMS ARE UNDERWAY .............................. . 11 3.1 Water Policy Reform Achievements in the Middle East and North Africa Region ...................... ........................................ 11 3.2 Specific Challenges and Characteristics of Policy Reform in Egypt and Tunisia .............................................................. 16 3.3 The Call for Action .............................................................. 21 IV. FOUR PILLARS IN WATER POLICY REFORMS . . 23 4.1 Management of Groundwater and Aquifers ........................ ..................... 23 4.2 Water, Agricultural Policies and Food Security ................ ...................... 29 4.3 Institutional Reforms: Decentralization and Public-Private Partnerships 34 4.4 Non-Conventional Water Resources .42 4.5 Issues in the Stakeholder Panel and Thematic Sessions .46 V. REGIONAL ACTIONS SUPPORTING REFORM . .49 5.1 Partnerships .49 5.2 Supporting Regional Cooperation through Water Policy Reforms and Donor Cooperation .51 ANNEXES 1. Agenda ................................................................. 53 2. The Water Panel ................................................................. 59 3. Statement of Middle East and Mediterranean Regional Day - From Scarcity through Reform to Security .................................................... 60 - 11- Foreword he Middle East and Mediterranean facilitating logistical preparation and the various Regional Day was held at the 3d World Middle East and Mediterranean countries Water Forum (3WWF) in Kyoto, Japan on diplomatic representations in Japan for fruitful March 20, 2003. Under its Regional Water discussion and support in preparation of the event. Initiative (RWI), the World Bank Middle East and In addition we would like to thank Dr. Ismail North Africa Department took a lead in Serageldin, Director General, Library of coordinating the preparation of the Middle East Alexandria, for serving as the master of ceremony and Mediterranean Regional Day, in close during the whole event, moderating the opening collaboration with countries and partner and closing sessions. organizations. Our thanks are, of course, due to the co-organizers The Regional Day represented a unique platform of the event -the World Water Council, from which major stakeholders highlighted key UNDP/IDRC, IDB/ICBA and GWP-Med, whose water challenges and shared knowledge and best critical involvement and contribution to the practices about the water policy reforms agenda thematic sessions made the Regional Day a they are pursuing to address these challenges. The successful event. Day was also an opportunity to reiterate the message that addressing regional water scarcity We would like to extend our special appreciation requires an integrated approach to sustainable to the financiers for supporting the preparation of water resources management, with stronger the event, including the 3rd World Water Forum coordination among regional organizations and (3WWF), the Swiss Agency for Development and networks. Cooperation (SDC), Japan International Cooperation Agency (JICA), Japan Official Many people contributed to the success of this Development Assistance and the Canadian Day. First of all, we would like to send our deep International Development Agency (CIDA). thanks to H.E. Dr. M. Abu-Zeid, Minister of Water Thanks are extended to all the resource persons for and Irrigation of Egypt for his active participation their presentations during the thematic sessions, to and for sharing well-appreciated lessons learned the ten panelists whose contributions during the from his country's water policy reforms. The closing session were invaluable and to the dynamic intervention of H.E. Mr. Ameur Horchani, group of Egyptian children who performed a Secretary of State, Ministry of Agriculture, the compelling musical show "A Better Future For Environment and Water Resources of Tunisia on You and Me". the country's achievements in the water policy reform agenda was enlightening. Mr. Peter The contributions of many World Bank staff were Woicke, Executive Vice President of the World instrumental in achieving the Regional Day's Bank, provided stimulating remarks during the success. A special word of thanks is due to the opening session and H.E. Ms. Rodoula Zissi, support provided by the Regional Water Initiative Greek Deputy Minister for Environment offered Team of Salah Darghouth, Satoru Ueda, Ashok instructive information on the EU Framework Subramanian, Shobha Shetty, Manuel Schiffler, Directive. We would like to thank the Japanese Nathalie Abu-Ata and Josephine Onwuemene as Water Resources Association for making this event well as Masatomo Watanabe and Naoto Mizuno in possible, the Secretariat of the 3WWF for Japan. Vijay Jagannathan Hideaki Oda The World Bank The 3rd World Water Forum Secretariat . .l . ACRONYMS AGFUND Arab Gulf Programme for United Nations Development Organizations ALMAE Alliance Maghreb Mashreq pour l'Eau BOT Built Operate Transfer CIDA Canadian International Development Agency EU European Union FAO Food and Agricultural Organization GIC Groupement d'Int6r&t Collectif GWP-MED Global Water Partnership - Mediterranean ICARDA International Center for Agricultural Research in the Dry Areas ICBA International Center for Biosaline Agriculture IDA International Development Assistance IDB Islamic Development Bank IDRC International Development Research Centre IFPRI International Food Policy Research Institute IPCC Inter-Governmental Panel on Climate Change JICA Japan International Cooperation Agency LID Land improvement districts m3 Cubic Meters MEDRC Middle East Desalination Research Center MIGA Multilateral Investment Guaranty Agency MMRD Middle East and Mediterranean Regional Day MIO-ECSDE Mediterranean Information Office for Environment, Culture and Sustainable Development MNA Middle East and North Africa MP Member of Parliament MWRI Ministry of Water Resources and Irrigation (Egypt) NGO Non-Governmental Organization NWRA National Water Resource Authority PAMIUNEP Plan d'Action pour la Mediterran6e PPP Public-private partnership PSP Private sector participation O&M Operations and Maintenance OSS Sahara and Sahel Observatory RBA River Basin Authority RBO River Basin Organization SDC Swiss Agency for Development and Cooperation SWUF Scheme Water Users Federation UFW Unaccounted For Water UNDP United Nations Development Programme WDI World Development Indicators WDM Water Demand Management WTO World Trade Organization WUA Water Users Association WRM Water Resources Management 3WWF Third World Water Forum - iv - , - a. . , ' SLIA}MAR Y OF THE REGIONAL DAY 1 INTRODUCTION T he Middle East and Mediterranean its Regional Water Initiative (RWI), the Regional Day (MMRD) was held on World Bank Middle East and North Africa March 20, 2003 at the Third World Region was entrusted by the 3WWF Water Forum (3WWF) in Kyoto, Japan. It Secretariat to coordinate the Forum. Co- was dedicated to issues and challenges sur- organisers of the event included rounding water resources and offered an op- UNDP/IDRC, IDB/ICBA and GWP-Med. portunity for countries to share their Two regional meetings were held in Spain experiences in promoting water sector re- (June 2002) and Egypt (October 2002) at forms. An estimated 450 participants from which delegates from 12 countries designed the Middle East and Mediterranean coun- the MMRD program. In addition, tries attended. participants were involved in various activities such as (a) conducting analytical The objectives of the Regional Day were: and diagnostic studies, (b) holding multi- country video-conferences to prepare for the 1. To present major water issues and on- Johannesburg Summit and (c) holding vir- going policy reforms in the region; tual conferences on themes of common in- 2. To prepare a regional statement to sub- terest to countries of the region, leading up mit to the ministerial conference at the to the 3WWF. forum; Several organizations and donors funded the 3. To prepare a regional action plan to ad- preparation for and organization of the dress common water issues and coordi- event, namely, the 3WWF Secretariat, the nate donor assistance strategies; Swiss Agency for Development and Coop- 4. To establish a more rigorous mechanism eration (SDC), Japan International Coopera- to share information among countries. tion Agency (JICA), Japan Official Development Assistance (Japanese Gov- The Regional Day was the result of a year- ernment), International Center for Biosaline long collaborative effort with countries of Agriculture (ICBA) and the Canadian Inter- the region and several organizations. Under national Development Agency (CIDA). Introduction The MMRD represented an opportunity to the Nile Basin Initiative as an example of establish and strengthen partnerships with regional cooperation over shared resources. several organizations and networks involved in regional water resources; these included H.E. Mr. Ameur Horchani, Tunisian Secre- UN-ESCWA (United Nations Economic and tary of State, Ministry of Agriculture, the Social Commission for West Asia), Environment and Water Resources, ex- CEDARE (Center for Environment and De- plained some aspects of the "Tunisian suc- velopment for the Arab Region and Europe), cess story" and highlighted the importance OSS (Observatoire du Sahara et du Sahel), of adapting imported irrigation technologies ICARDA (International Center for Agricul- to local realities and progressively adapting tural Research in the Dry Areas), Med-Wet them to the institutional framework. He (the Mediterranean Wetlands Initiative), and stressed the Tunisian government's efforts IME (the Mediterranean Water Institute). to treat and use wastewater, adopt progres- Several high-level officials and resource sive pricing and introduce the issue of persons from the Middle East and Mediter- drought impact in national water resources ranean Region also participated. management and planning. The conference began with a plenary session H.E. Ms. Rodoula Zissi, Greek Deputy Min- at which officials from Egypt, Tunisia and ister for Environment, Physical Planning and Greece presented their experiences in ad- Public Works, gave an overview of efforts vancing their country's water reforms. Dr. by countries of the region in water reforms, Ismail Serageldin, Director-General, Library presented the EU Framework Directive, and of Alexandria and former Chairman of stressed the integrated approach to river ba- GWP, was the master of ceremony for the sin management. entire Regional Day. At the end of the opening session, a group of Mr. Peter Woicke, Executive Vice President, Egyptian children performed a musical World Bank, gave the keynote speech, offer- show, "A Better Future for You and Me," ing an overview of water challenges and which described water conservation for new their impact on regional growth and socio- generations. economic development. He highlighted the importance of efficiency and reallocating the After this, four thematic sessions were held resource to higher value uses, promoting on key water issues agreed upon by the private sector participation, and empowering countries during planning meetings. These stakeholders. included (a) sustainable groundwater and aquifer management, (b) water, food secu- H.E. Dr. M. Abu-Zeid, Egyptian Minister of rity and agricultural policies, (c) institutional Water and Irrigation reiterated the impor- reforms and public-private partnerships and tance of integrating the management of wa- (d) non-conventional water resources. Each ter resources. Also, he stressed the need to session was the result of collaborative ef- optimize available water resources by (a) forts among partner organizations and of- modernizing existing irrigation systems, (b) fered case studies from countries and involving stakeholders, and (c) establishing resource persons from the Middle East and public-private partnerships. He pointed to the Mediterranean Region. Some drew upon 244 Introduction World Bank RWI analytical and diagnostic scarcity requires an integrated approach that studies. The case studies were also exten- stresses greater water efficiency, developing sively discussed by country representatives and managing non-conventional water solu- and organizations during the 2002 RWI re- tions, and regional partnerships for sharing gional consultations. knowledge. At the closing session, participants discussed The following report has four sections. Sec- various topics from the thematic sessions tion 1 summarizes water issues and stresses and offered recommendations for the Re- the key role of policy reforms to achieve wa- gional Statement. The session featured a ter security. Section 2 describes the physi- panel discussion, composed of ministers cal, institutional, economic and environ- from the various countries, stakeholder mental reforms underway in some of the groups (ALMAE, the federation of irrigation countries and presents policy achievements associations of the Mediterranean, MIO- in Tunisia and Egypt. Section 3 addresses ECSDE) and regional organizations/ net- the issues covered in the thematic sessions works (PAM/UNEP; GWP-MED); the panel and offers recommendations for policy re- presented options to advance regional coop- forms. Section 4 builds on the closing ses- eration and financing needs. sion panel discussion and presents recommendations for more efficient regional A critical message from the day-long con- cooperation among countries, networks and ference was that dealing with regional water donors. *3 - l~~~ POLICY REFORMS: CHALLENGES AND ACHIEVEMENTS 2.1 Water: A Critical Issue in the Region A. MNA: The world's most arid region B. Limited and uneven access to improved water supply and sanitation M v } 'NA has only 1% of the world's accessible freshwater. Rainfall is In 2000, about 31 million people in the re- low, erratic and poorly distributed. gion lacked access to safe water and more More than a third of the river supply flows than 51 million lacked access to safe sanita- from countries outside the region. Further, tion. However, these figures hide important floods and droughts have plagued the region disparities both among and within countries, in recent years. Available water per capita and between urban and rural sectors. For numbers are among the lowest in the world, example, only 31% of the rural population in with less than 1,200 cubic meters per person Iran and Yemen had access to improved in 2000. The problem is exacerbated by in- sanitation as opposed to 91% and 98% in creasing population growth, which more Egypt and Jordan, respectively. In addition, than doubled in the last 30 years, reaching only 30% of Oman's rural population, and over 300 million in 2000. Worse still, it 64% in Saudi Arabia and Syria, had access could double again in the next 30 years, with to improved water sources in 2000, com- dire effects on water demand. Annual per- pared to 94% in Egypt and 88% in Algeria. capita availability is predicted to fall by 50% to about 650 cubic meters by 2025, while 14 C. Mining groundwater, destroying countries have already reduced renewable resources water availability per capita to less than 500 cubic meters a year--a level used to define a In most countries, extraction levels are well "water barrier" to growth, beyond which beyond the rate of annual recharge; this scarcity becomes a key concern in people's causes seawater to intrude and pollutants to lives and affects overall development. seep into the supply. For example, in Jordan Within the next 30 years, most countries in and Yemen, extraction is more than 150% of the region will cross that barrier and experi- ence even more severe water shortages. *5 Policy Reforms: Challenges and Achievements the renewable resource base.' Though al- The Nile waters in Egypt are contaminated ready grim, these national averages mask by uncontrolled industrial and agricultural significant local variations. In the Sana'a discharges. The poor water quality of Lake basin, abstraction is more than three times Manzala in the Nile Delta, once supplying higher than recharge, and in Gaza, aquifers 30% of Egypt's total fish catch, now are being depleted even faster. Such threatens wildlife, ecosystems and the health over-exploitation risks further damage to and livelihoods of many people, while underground water reserves through the in- polluting the Mediterranean Sea. trusion of seawater or the leakage of pollut- ants. While not yet as dire in the Maghreb Polluted water and deficiencies in water re- countries, shortages due to over-extraction sources management, supply and sanitation of groundwater are imminent. are increasingly seen as key elements in en- vironmental health policies. Coupled with D. Shortages compounded by pollution hygiene practices, increasing the sustainable access to water supply and sanitation will Widespread dumping of municipal and undoubtedly reduce water-related diseases industrial wastewater into rivers and lakes, and improve environmental health. solid waste deposits along river banks, uncontrolled seepage from unsanitary E. Water is used inefficiently landfills and contamination by fertilizers and pesticides are all degrading freshwater Irrigation. Due to the predominance food resources. This process increases health self-sufficiency and rural employment risks, especially for children (the primary policies, the region allocates 89% of its victims of water-related diseases), and water resources to agriculture. However, threaten the livelihoods of many. Moreover, water use and safe re-use in agriculture is the lack of sewage treatment systems is very inefficient: On average, only about polluting groundwater. Surface water run- 40% of the water reaches the crops. off also affects agriculture and irrigation, ultimately contaminating food and Urban supply. Up to 52% of the bulk water increasing infectious disease risks. Due to supplied to cities is not billed to water users such water pollution, the countries' and is thus considered "unaccounted-for- economies are severely strained. For water" (UFW). This is a very high figure example, the cost of environmental when compared to the under 20% achieved degradation due to water pollution was by well-run utilities: For example, UFW recently estimated at 1.2% of GDP in ranges from 52% in Amman to 21% in Morocco and Jordan, 1% in Egypt, and Tunis. UFW can be divided into two 0.7%-1% in Algeria, Lebanon and Tunisia. components: physical losses and commercial Morocco's most important river, the Sebou, losses. According to some estimates, has become a waste dump for the cities commercial losses (illegal connections, along its banks. Algeria's Mitidja and Saida malfunctioning meters, incorrect meter aquifers are threatened by urban pollution, reading, faulty billing) constitute the major industrial effluents and agricultural runoffs. portion of UFW in some MNA cities.2 ISource: Workshop on Sustainable Groundwater 2 Source: Urban Water and Sanitation in the Middle Management, MNA Regional Water Initiative, Sum- East and North Africa Region, the Way Forward, the mary Report, Sana'a, Yemen, June 2000 World Bank, 2000 644 Policy Reforms: Challenges and Achievements Figure 1 Projected Renewable Resources Per Capita by Major Region Year 2025 0 1960 16 - E 2000 U 14 - _Q 02025 X 12 - Ql 10 -. ci) E C-) World MNA Asia Africa Source: World Development Indicators, 2002. World Bank Group, Washington, DC (The renewable resource data in WDI 2002 was compiled from the World Resources 2000-01 and supplemented by the FAO's Aquastat data); World Bank Estimates (for MNA 2000); World Resources: 5-volume index, volumes 1986 through 1992-93, World Resources Institute, 1993, Wash- ington. 0+7 Policy Reforms: Challenges and Achievements Table 1: Water Availability and Usage in MNA Countries Annual A%ailability Annual Waler Use % Usage bh Seclor Natural Per capita ReLneable Desalinized Wastevkaier Renewable as a % of AgricuI- CounIr) Resources Unter Re-use Asailabiliti. BCNI fatal faler Domestic Indusir) lure ( BCNIA rJ (BC. I) r) (BCMI/yr) Sear 2000 Resources u (C(NI) Algeria 11.50 0.07 n a 380 4 59 40 25 15 o0 | Bahrain 0.11 0.04 n.a. 214 0.25 170 26 3 71 Ditioun 0 02 0.00 n.a. 24 0 02 113 88 0 12 Egypt 61.90 0.06 5.90 1060 73.10 108 6 8 86 1r:i- 129.W0 0.11 n.a 2028 70 30 54 h 2 92 Iraq 80.00 0.03 n.a. 3441 42.80 48 3 5 92 Israel I 1.56 0.10 0.24 307 1 71 90 29 7 64 Jordan 0.87 0.00 0.07 193 0.98 104 26 7 68 Kuwait 0 II 0.65 0.12 438 0.76 87 37 2 601 Lebanon 3.20 0.00 n.a. 740 1.29 40 28 4 68 Libya 0 S0 0.03 n a 157 3.89 469 9 4 87 Malta 0.04 0.03 0.00 193 0.02 28 96 0 - Nlonxco 20.00 0.01 0.07 701) 16.84 84 5 - || Oman 1.60 0.03 0.02 687 1.22 74 9 1 93 Qatar 0.05 0.12 n.D 293 028 23 3 74 Saruabdia 2.50 0.71 0.15 162 17.00 506 9 I 90 Synanm Arab 18.70 0.00 0.26 I 122 14.70 78 9 l 87 Republic Tunisia 3.35 0.14 365 2.53 72 12 4 84 UAE 0.20 0.55 0.14 307 1.60 IS0 24 10 67 &WGank 0.76 0.00 0.01 260 0.44 57 51 49 TotalI Average % 339 3 n.a. 1135 258 72 7 4 39 MNA Sources: Govemment figures, World Bank MNA Region estimates, FAO, World Development Indicators 2002, World Resources 2000-2001: People and Ecosystems, the Fraying Web of Life; 2002 IDA Worldwide Desalting Plants Inventory, Report no. 17 Definitions: Annual Renewable Resources: total renewable freshwater resources, including mobilizable surface water and non-fossil groundwater in country as well as net river flows from other countries. Annual Withdrawal: refers to total water withdrawal, including desalinized water resources in countries where they are significant and non-renewable groundwater (aquifers). Withdrawal does not include evaporation losses. 8 4 Policy Reforms: Challenges and Achievements 2.2 Water Policies: Key to Development When populations were small and largely and Reducing Poverty, presented by rural, and food security was a top priority, Mr. Peter Woicke, Executive Vice Presi- supply had to be expanded and agriculture dent The World Bank. promoted. However, today's efficient inter- national grain markets can deliver imported Although MNA countries modernized their wheat at around $130 a ton, far less than economies and social systems remarkably when grown in the region (which requires over the past 30 years, progress now is up to 1,500 cubic meters of water). hampered by high population growth, political instability and conflict, government dominance of economic activity and limited 2.3. Resolving Scarcity Problems through integration into global markets. Indeed, 4 Reforms million jobs are needed each year, but public sector employment is reaching its limits and Thus, policy reforms must focus on increas- the investment climate it not greatly ing water efficiency through pricing meas- conducive to increased private activities. ures, reallocating water to higher value uses and promoting public-private partnerships. In no other region is water as important to Further, while reorienting water policies, growth, development and reducing poverty. countries must ensure that all stakeholders For years, huge investments brought water are empowered and their needs considered-- and sanitation to millions and helped especially those of the poor. agriculture to develop. Still, demand for water outstrips supply: A destructive cycle The region needs to integrate with and com- has emerged where water shortages impede pete in the global economy. To achieve this, growth, which leads to less capital for it must promote a dynamic private sector providing the water needed for rapidly that can produce and export competitively. expanding populations and the economic This will involve greatly increasing invest- activity required to support them. This ment in the sector, along with educating and degrades the quality of life (especially for training human capital. the poor)--34 million people lack safe water and over 55 million lack sanitation--and Agriculture could adopt water saving tech- exacerbates social tensions. If continued, nologies such as drip irrigation (twice as current practices may plunge the region much can be produced with half the water deeper into crisis; and, conflict over scarce used in traditional irrigation methods) and resources at local and national levels is introduce advanced systems to achieve inevitable. greater efficiency, along with capacity build- ing and training programs. Further, agricul- However, through an integrated approach to tural water prices will gradually need to rise managing sustainable water resources, to be more closely related to the costs of countries could mobilize popular support to supply and deter uneconomic use. conserve water, reconcile competing claims on limited resources, allocate water to Moreover, a less water-intensive agricultural higher-value uses, prevent pollution and system coupled with reduced loss in munici- focus international support for water pal systems could eliminate the need for in- initiatives on priority areas. vestment in new water supply for the next *9 Policy Reforms: Challenges and Achievements decade. While such improvements are ages: Thriving economies can afford to use costly, net investment savings would in- unconventional sources such as desalination crease the capital available for private in- to supplement freshwater supplies. This will vestment and upgrade the physical only materialize if strong programs to save infrastructure (including water delivery net- and reallocate water eliminate the water bar- works) needed for private sector growth. It rier to growth. For example, Malta is a small could also expand water supply for house- open economy that is chronically short of holds (including sanitation), which would freshwater, but successfully used economic reduce the human costs of impaired health growth to supply 70% of its water needs by due to water-borne diseases. desalination. If "water for growth" strategies can avert a The Mediterranean countries can share their supply crisis and raise water's value added in lessons with MNA on how they overcame national economies (and hence contribute to water barriers through management policies growth), then "growth for water" strategies and practices to help develop national can ultimately resolve regional water short- economies. 1044 -~~~ POLICY REFORMS ARE UNDERWAY 3.1. Water Policy Reform Achievements in the Middle East and North Africa Region In the 1990s, water policy shifted dra- * Introducing sound economic principles matically in several MNA countries. in policy decisions and practices; Supply augmentation policies, dominant * Improving water quality. in the 1970s-1980s, were no longer the pri- mary concerns, while managing demand was A. Reducing water losses seen as vital. The aim was not only to seek new water supplies but to increase the pro- Unaccounted-for-water (UFW) is a major ductivity and efficiency of existing water problem. To reduce losses, utilities have resources, as well as those to be developed adopted leak detection programs, rehabili- in the near future. tated networks and meters and replaced leaking hose connections, which had a sub- Many countries embarked on policies and stantial impact in several countries. How- actions to address issues at the physical, in- ever, curtailing loss is not limited to utilities stitutional, economic and environmental but extends to all water users, and water- levels. Reforms include: saving devices are needed for irrigation as well as municipal use. Thus, innovative in- * Reducing water losses, both in rural and struments are being applied: For example, in urban areas; Tunisia, matching grants were obtained to * Reducing groundwater over- adopt water-saving technologies, while in exploitation; Jordan and Egypt, public awareness cam- * Making irrigation more efficient; paigns were organized to encourage water * Finding alternate sources of water sup- conservation. ply; * Promoting institutional and legislative B. Reducing groundwater over- reforms; Exploitation * Preparing national water strategies and well-designed laws; Groundwater resources are being depleted through the mining of fossil aquifers or overuse of renewable aquifers. To correct *11 Policy Reforms are Underway this, countries are (1) creating well- able options to augment water supply. Al- protection zones to prevent further extrac- though most of the efforts to use the tion from over-depleted sites (Tunisia), (2) wastewater are being applied in an un- banning new drilling wells in some areas planned manner, some activities are also be- (Syria), (3) closing all private wells that are ing targeted. For example, in Jordan, a over-logged and (4) providing water to program of consolidated investments to treat farmers through a more limited number of wastewater has been devised for major cit- collective wells to reduce well-interference ies. Using the wastewater for irrigation is problems. (Well-interference occurs when a now substantial and the share of total treated high-capacity well causes the aquifer around wastewater used is projected to increase it to lose water in a pattern known as a cone from 18% in 1998 to about 34% in 2020 of depression. Wells located within the (The World Bank, 2001). ''cone" may experience lower water levels and have problems getting water if the level Desalination costs have progressively de- is lower than the well pump). clined, now at US$.50-$.90 per cubic meter for seawater and US$.20-$.40 per cubic me- Yemen, for example, is also adopting mac- ter for brackish water. The Gulf countries roeconomic measures to increase the price are the most heavily involved in desalination of diesel and raise import duties on drilling in MNA, where desalinated water represents rigs and pumping equipment, as it is ex- a high percentage of municipal and indus- pected this will reduce over-exploitation. trial water supplies. However, because of the These measures are coupled with rules and high cost of delivery, desalination remains incentives to motivate stakeholders to re- an expensive alternative for most countries. duce the overdraft and apply water to its highest value. E. Promoting institutional and legislative reforms C. Making irrigation more efficient Institutional and legislative reforms are es- Improving irrigation efficiency is a pillar of sential as they provide the framework for the water policy reform in most of the countries. water sector. In the region, the reforms need For example, Egypt, Oman, Jordan and Tu- to focus on (1) restructuring water authori- nisia are increasingly using water-saving ties to better coordinate the work of public irrigation techniques. Governments are also entities and make administration practices applying financial incentives such as tax- more efficient, (2) developing participatory free, low- interest loans to meet the capital management and strengthening water-user costs of sprinkler and drip irrigation systems associations (WUA), (3) introducing clear and are readjusting the price of irrigation water strategies and rules/regulations, (4) water to reflect its true scarcity cost. creating water ministries and (5) strengthen- ing the role of the private sector. D. Finding alternate sources of water supply Restructuring water authorities. To address the weakness and relative inefficiency of In several countries, the use of treated public water entities, some countries have wastewater and desalinization are now vi- begun to restructure their water authorities, 1244 Policy Reforms are Underway streamlining the institutions and services; Agencies (RBAs) in 1995 to coordinate wa- this is being done to separate the manage- ter management in a single integrated entity. ment of the resource (mainly a government These were established as semi-autonomous function) from the delivery of water (han- public agencies with legal status and finan- dled either by public or private entities). In cial autonomy to manage single or multiple so doing, governments have reduced dupli- river catchments. Also, the agencies were cated responsibilities and tasks within the given wide powers including entering into water institutions and encouraged the prac- contractual arrangements with all types of tice where water resources are managed at bodies, agencies and institutions to carry out the lowest appropriate level. their functions, mandates and responsibili- ties. In addition, some countries have consoli- dated all-water related functions under a Developing participatory management. single Ministry to avoid overlap of various Several countries have made considerable mandates and responsibilities. In Tunisia, progress tackling institutional and legislative for example, the Ministry of Agriculture, reforms by developing participatory man- Water Resources and Environment, created agement schemes. For irrigation, countries in 2002, is responsible for managing water now rely more on water user associations resources, all water sectors (urban and (WUA) to perform some management func- rural), as well as the environment. This tions, with the aim of achieving autonomy represents a significant change since envi- and financial self-sufficiency. For example, ronmental issues were previously handled Tunisia is progressively delegating respon- by the Ministry of Environment and Land sibility for managing irrigation systems to Use and Planning, which no longer exists, water user/owner associations known as while irrigation issues were handled by the "Groupement d'Interet Collectif' or GIC Ministry of Agriculture. At the same time, at (Associations for Common Interest), which the provincial level, the management of irri- have legal status and financial autonomy. gation and water resources has been decen- They are in charge of constructing, operat- tralized to the country's 23 public provincial ing and maintaining potable water supply offices, which are financially autonomous. systems and irrigation schemes. More than The purpose is this change is to encourage 2,000 associations operate across the coun- the management of irrigation and water re- try, provide more than 35% of water supply sources at the lowest appropriate level. to rural populations, and cover more than 40% of public irrigated areas. In the future, In Morocco, the Government restructured their activities will extend to large-scale irri- and strengthened the legal status of the High gation and agricultural development pro- Council for Water and Climate. Chaired by grams. the Prime Minister, the Council is mandated to coordinate water resource policies and In Yemen, the Government launched a pro- future water strategies. Since the restructur- gram to increase user participation in man- ing, the Council is composed of major aging spate irrigation (a process where flood stakeholders from the public and private sec- water from mountain catchments is diverted tors, including water user representatives from river beds and spread over large areas). involved in water management. In addition, The strategy is to decentralize responsibility the Government created nine River Basin to scheme-level organizations and promote O+13 Policy Reforms are Underway user participation in financing and managing several countries have created separate min- operations and maintenance (O&M). The istries to deal with water issues. In Oman, program will support a three-stage decen- the Ministry of Water Resources was estab- tralization and user participation process. lished in 1989 to integrate the management First, with respect to the canals, the WUAs of water resources and strengthen the policy (based on existing informal water user development and planning capabilities. In groups) will be responsible for O&M. Sec- Jordan, the Ministry of Water and Irrigation ond, at the scheme level, the associations was created in 1992 to oversee water poli- will be federated into a Scheme Water Us- cies and strategies, planning, research and ers' Federation (SWUF) that will be respon- development, information systems, and pro- sible for its O&M, except for the headworks. curing the financial resources needed to im- Third, a scheme-level irrigation council will prove water resources. In Yemen, a new act as a joint farmer/government forum for Ministry for Water was recently created, re- ensuring public interest aspects of water sponsible for urban and rural water supply management and setting water charges. and sanitation, as well as water resources management and irrigation--tasks that were In Egypt, the Irrigation Improvement Project previously scattered among various minis- was introduced to upgrade the physical and tries and authorities. organizational aspects of irrigated agricul- ture. This entailed creating WUAs and en- Strengthening the private sector role. Pri- hancing cooperation between the irrigation vate sector participation has become an at- directorate and farmers. Supported by physi- tractive option for governments to improve cal improvements, farmers' participation performance and efficiency in the water sec- (both men and women) is leading to more tor. The most ambitious effort in domestic reliable water services, which, in turn, raises water was launched by Morocco. By 1998, it crop production and farmer satisfaction. included three concessions (in Casablanca, Rabat, Tanger and Tetouan) and more are F. Preparing national water strategies planned. In 1996, Gaza awarded a water and well-designed laws services management contract to the private sector to help local governments and the Several countries are revising or preparing Palestinian water authority improve water new national water strategies/plans to reflect service. innovative approaches to integrated water resources management (inter-sectoral coor- G. Introducing sound economic principles dination, decentralization, participatory in policies and practices management, and environmental/financial sustainability). The strategies/plans will then In almost all the countries, the costs of pro- serve as a basis for developing water laws viding water to both urban and rural areas and be used as the framework for investment are not fully recovered. Tariffs for urban wa- programs and policies. ter supply are subsidized, with the cost of water averaging about 2% of income. In ir- Creating water ministries. Given the in- rigation, fees cover only 6% of the cost of creased awareness of the importance of wa- water delivery (in Jordan). Such under- ter resources to the national economy, pricing leads most countries to a vicious 1444 Policy Reforms are Underway downward spiral, where services deteriorate lecting revenues from meter charges is often since financial resources are not sufficient to difficult. However, the need to improve cost cover costs; further, inadequate service leads recovery and achieve better O&M are cru- to fewer revenues being collected. cial issues if countries are to take on high- cost projects such as desalination or expand- The lack of financial resources has led sev- ing the coverage of wastewater treatment. eral countries to adopt policies such as (1) improving cost recovery from beneficiaries Increasing the financial and productivity re- and (2) raising the financial and productivity turns of water attracts funds from outside the returns to water. sector and provides profit incentives for pri- vate enterprises to increase their participa- For example, some have increased urban tion. Conversely, low economic returns in and rural water tariffs to better cover the certain sectors reduces the capacity for in- cost of O&M in water supply. Tunisia in- vestment and the potential to substitute more creased its urban water tariffs four times expensive water resources such as reclaimed over the past eight years (1996-2003). Jor- wastewater or desalination. Recently, some dan also increased urban block tariffs; under countries realized the need to increase the this system, the first 5-10 m3 are charged a value added and improve the productivity low, subsidized rate and the next blocks and financial returns to water in agriculture. have increasingly higher tariffs. The ration- In Tunisia, the 2000 water resources man- ale is to encourage households to save water agement plan focused on maximizing the and also ensure that the poor can afford economic value of water and on its efficient enough water water to keep themselves and management; the plan was tailored to each their environment healthy--typically 50 li- subregion country within the country ac- ters/per capita/day. In Jordan, the 1997 cording to its social and economic character- change raised the degree of progressivity, istics and capacity for change. and generated significant revenues from a large volume of consumers. In Syria, the H. Improving water quality cost of O&M for irrigation and drainage schemes is recovered partly from farmers in Although untreated municipal and industrial the form of service charges that are periodi- sewage is still released into the environment, cally reviewed and modified by a committee efforts are underway to improve the region's of the Supreme Agricultural Council; al- water quality. However, while environ- though still subsidized as of December mental regulations have been adopted, en- 1999, service charges to farmers were in- forcement and compliance mechanisms are creased to $75/ha to meet O&M costs. Due still the key issues, along with building ca- to this reform, water charges will cover pacity and raising awareness. about 40% of capital costs in the irrigation sector, making Syria one of the few coun- In Morocco, the 1995 Water Law provided tries in the region that has tried to recover for integrating water quantity and quality investment costs for new projects in recent management and introduced a tax based on a years. "polluter pays" principle. In addition, the law will enforce abstraction and effluent Despite these advances, increases in water discharge permits, and it introduced sanc- tariffs remain a political problem and col- tions and penalties for violations. It also *15 Policy Reforms are Underway aims to protect water quality by defining Egypt shed light on the complexity of the environmental mandates and enforcing sanc- task. tions and penalties: It specified that the re- lease of pollutants or polluted water into 3.2.1 The Egyptian experience, presented rivers and aquifers is either prohibited or by H.E. Dr. Mahmoud Abu-Zeid, Minis- authorized only by a permit approved by the ter of Water Resources and Irrigation River Basin Authorities (the body responsi- ble for monitoring water quality) and that One of the major challenges in the water pollution charges will be collected if regula- sector is to close the rapidly increasing gap tions are ignored. The challenge now is to between limited water resources and escalat- fully implement these laws. ing demand created by development in vari- ous economic sectors. To meet the demand In Jordan, since the mid-1990s, water qual- and, at the same time, ensure the sustainable ity has been improving. Existing standards use of water resources, Egypt has had to op- were re-assessed and some joint monitoring timize the use of conventional sources, as mechanisms between different ministries well as investigate the feasibility of non- and authorities were established. Laborato- conventional sources. The country has con- ries were upgraded and an early warning sidered reclaiming huge amounts of land to system is now in place. Some progress was add to the current acres of arable/cultivable made in controlling industrial effluent dis- lands. These tasks are critical, since irriga- charges into sewers through permits and in- tion, and by extension, the agricultural sec- centives for adopting clean production tor, are vital for the economy and crucial for processes are being examined. Regulations the Government in its fight to reduce pov- and guidelines for drinking water supply erty and provide better sanitation to the through proper use of private tankers and population: The sector alone consumes household storage are being strengthened, around 85% of the country's fresh water re- including through increased public aware- sources, contributes to about 20% of local ness. production and about 20% of exports, and accounts for approximately 34% of the 3.2 Specific Challenges and Characteris workforce. tics of Policy Reform in Egypt and Tunisia Faced with these challenges, the Ministry of Water Resources and Irrigation (MWRI), Although some countries have taken signifi- adopted an integrated management approach cant steps to restructure their water sectors that combines all available resources (as indicated above), reforming water poli- (freshwater canals, drainage water and cies is a relatively new process in MNA; groundwater) to meet the water demands of success will depend mainly on the depth and different users. The approach requires full realism of each reform, on the participation coordination between government institu- of all stakeholders and more important, on tions at all levels, and active participation of each country's ability to enforce the new water users in planning, managing and oper- policies. During the opening session of the ating irrigation and drainage systems. The Regional Day, lessons from Tunisia and Government recognizes that only with re- forms will it be able to promote environ- 1644 Policy Reforms are Underway mental and ecological sustainability and that and rehabilitating existing grand bar- users and the private sector will play a rages and control structures on the Nile greater role in water management and ser- and main canals); vices. B. Protecting water quality and reducing New policies pollution through preventive measures. These include regularly assessing water Given the new approach, the Ministry pre- quality, enforcing the laws and coordi- pared a National Water Policy (from the nating long-term policies with other present until 2017), which includes the fol- ministries. Also, subsidies on fertilizers lowing themes: and pesticides were removed and public awareness programs on water conserva- A. Optimal use of available water resources tion were launched. (improving irrigation systems on the branch and field canal levels, installing a C. Developing new water resources in co- tile drainage system, improving irriga- operation with the Nile Basin riparian tion and drainage pumping stations, in- countries. troducing new crop varieties, replacing )+17 Policy Reforms are Underway Box 1: Elements of water sector reform in Egypt's irrigation system Reforms are expected to occur at three levels. 1. Decentralization and management transfer in the old lands As agriculture expands to new areas in the Nile Valley, the Ministry of Water Resources and Ir- rigation budget is increasingly strained. To reduce the Government's financial burden, the Minis- try is progressively decentralizing the management of water/irrigation to water boards-- organizations based on representation. The boards operate at the secondary (branch) canal level or above. With respect to the O&M of Government-owned infrastructure, the new draft Law 12 for Irrigation and Drainage delegates part of the management or transfers complete control to the water boards or specialized companies. 2. Reform in MWRI services The Ministry provides many services to the general public and various sectors. It is responsible for authorizing water use and managing surface and groundwater resources. Also, it manages the design, construction, O&M of all water resource infrastructure and irrigation/drainage networks, introduces water quality laws and protects the Nile. To improve public works and management, it intends to expand the private sector's role-either through privatizing part or all of various ac- tivities/responsibilities, or by privatizing ownership. 3. Reform in the new lands (mega projects) The Government plans to increase habitable land from the current 5% to 25%, and increase the cultivable land area from the current 8 million acres to 11.4 million acres by 2017. Reflecting its commitment to greater private sector participation in development projects, the Government created two holding companies to manage, operate and maintain the irrigation/ drainage networks in Toshka and North Sinai activities. Also, the companies will provide appro- priate services to investors and small farmers. They will raise sufficient funds through service charges from beneficiaries in the projects and the sale of new lands to investors. Each holding company will consist of several smaller companies and offer a greater role to the private sector directly at the start. Main infrastructure, including irrigation/drainage networks and pump sta- tions, will remain Government property to be maintained and operated by MWRI. 1844 Policy Reforms are Underway Lessons Learned forms in terms of efficiency, cost and human resources. The evaluations would The most important experiences to date in- in turn provide feedback to policy makers clude the following: for necessary changes-both in policies and processes. 1. All stakeholders need to participate in the design and implementation stage of re- 3.2.2. Policy reform in Tunisia. The need forms. If involved, stakeholders will have for reform, presented by H.E. Mr. Ameur more input on the performance of the ir- Horchani, Secretary of State for Water rigation/drainage systems and obtain Resources and Fisheries, Ministry of Ag- greater control of financial contributions riculture, the Environment and Water to maintain the infrastructure. Overall, Resources. such participation builds interest, com- mitment and ownership, in addition to the Water resources in Tunisia are scarce and consensus on the need for change. irregular. Among the Mediterranean basin countries, Tunisia has one of the lowest lev- 2. Reforms for the irrigation subsector need els of available water and it is estimated that to be developed and promoted in close per capita water availability will drop to coordination with relevant agencies, de- 315m3 by 2030. Also, the extent of surface partments, entities and stakeholders. water varies greatly depending on the area-- 10 being the maximum/minimum ratio be- 3. Existing laws need to be reviewed and tween the north and the south of the country. updated to create an enabling environ- ment in which reforms can flourish and In the early 1990s, authorities decided that the private sector assumes a greater role. various policies needed to be changed. This is key with respect to private sector These included increasing mobilization costs participation because companies could and investments for maintenance and re- exercise monopolistic behavior due to a placement operations, and meeting water lack of competition. Human resources users' expectations for a modem and trans- must also be developed, among officials parent management to match Tunisia's new and stakeholders, to help them understand economic and social environment. Water and introduce the new regulations. policy reforms were based on the process for providing the limited but expensive resource 4. Prior to large-scale application, reform (water) and managing the increased demand. policies/activities need to be introduced The supply strategy was based on an ap- on a pilot basis. The implementation proach that integrated planning systems at process needs to be monitored and evalu- the local, regional and national levels, and ated regularly with performance indica- made a priority of optimizing comparative tors. Evaluations should also assess the advantages and integrating conventional and economic and social impacts of the re- non-conventional resources. * 19 Policy Reforms are Underway Box 2: The 10-year Program of Reforms in Tunisia A 10-year program was designed and introduced from 1990-2000 that aimed to: / Provide most Tunisians with potable water--100% in urban areas and 83% in rural areas; V Create irrigated areas throughout the country, 35% of which would permit regular, intensive and permanent production; / Meet the water needs of industry and tourism; / Introduce used-water collection systems and create about 60 water treatment stations, thereby protecting the natural environment against pollution and recycling water for future use; v Protect citizens against the harmful effects of drought and floods. Achievements day, 150 million m3 are treated, part of which irrigates 7000 ha, and desalination Tunisia developed a complex and diversified capacity is 50,000 m3/day. The use of hydraulic infrastructure throughout the conventional water resources is signifi- country to mobilize its water resources. As a cant and supply is expected to meet total result of the strategy and reforms described water demand, which accounts for the in- above, the country ensured food security and creased population and improved stan- improved the quality of life in urban, rural dard of living, by 2030. and Saharan areas. Also, it met the water needs of the industrial and tourism sectors, * Developed irrigated surface perimeters while respecting the ecosystem's limited using a water-saving policy to increase capacities and helping solve future water agricultural production and make water issues. Specifically, the reforms: routinely available. * Promoted the economic valorization of * Reduced the negative effects of drought water resources and combated all types of (a practical guide about managing waste, by applying audit controls and fi- drought was designed in 1999, based on nancial incentives. the country's experience as well an on that of countries with similar conditions). * Developed a water economy program for irrigation and drinking water by enhanc- * Ensured the equal distribution of water ing the use of water-saving technologies resources by equipping all regions and al- and creating a pricing system that penal- lowing citizens to profit from these re- ized water waste. sources. At present, 2,000 elected collective interest associations (WUAs), * Developed conventional and non- spread across the country, direct the man- conventional water resources (80% of the agement and use of irrigation and rural wastewater will provide 0.4 billion cubic water infrastructure. meters of recycled water by 2030). To- 200 Policy Reforms are Underway Lessons Learned Following the opening talks, participants questioned speakers about capacity-building Lessons from the Tunisian experience in- efforts, good governance and the role of the clude the need for: World Bank in supporting these efforts, as well as experiences from regional coopera- 1. Diversification--moving from solely tra- tion programs for water security, such as the ditional to non-conventional water Nile Basin Initiative. sources such as wastewater, and mobiliz- ing water resources by investing in a 3.3 The Call for Action combination of small, average-sized and big hydraulic structures, i.e. building Important progress has been made in intro- small and large dams. ducing water policy reforms in the region. However, Mr. Ismail Serageldin, Director 2. Adopting a new, progressive pricing General, Library of Alexandria and former Structure. Chairman of Global Water Partnership, noted that serious challenges remain. Water 3. Contingency planning--preparing for is key for reducing poverty and promoting droughts (including artificially recharg- economic growth, but where it is lacking, ing aquifers to store surplus surface wa- economic growth is restricted and social ten- ter underground). sions increase. Thus, all partners must con- tinue efforts to insure that water issues bring 4. Advanced technology and research-- people together rather than become a cause emphasizing technology transfer and re- of war. In the same vein, water can be a vec- sults of in-depth studies, while using ex- tor for peace and security rather than a isting techniques adapted to semi-arid source of conflict and instability. conditions. For example, a technology watch was created to identify and adapt The regional statement for the Middle East worldwide technological and scientific and Mediterranean day called for immediate achievements, especially with respect to action by governments, water users and treated wastewater, the recharge of donors, through strong partnerships (see groundwater, desalination of brackish Box 3). The fragmented, supply-oriented water, and management of droughts, so approach to water development must change as to reduce the damaging effects of wa- to one that integrates water management, ter shortages. stressing partnerships between water suppliers and users, and cooperation 5. Participation and awareness raising-- between donors and institutions active in the informing users and other stakeholders region. about educational programs, etc. *21 Four Pillars in Water Policy Reforms able manner. Licenses for drilling ground- regulations, the lack of clear laws that define water have been issued, charges applied and water rights, and traditional perceptions of wells metered. In some cases, these actions water rights. Shared aquifers are also being have had positive results, and the amount of severely depleted due to over-exploitation. groundwater withdrawn has declined. How- Nevertheless, they can be successfully man- ever, issues remain such as governments' aged if countries cooperate fully and work capacity to monitor and enforce the new together. Overview and issues relating to groundwater management, presented by Prof. Dr. Ram6n Llamas, Professor Emeritus, Complutense University, Madrid The driving force for developing groundwater in the Mediterranean is farming. The rapid expansion of groundwater use has been facilitated by technical developments and reduced drilling costs, which, at pre- sent, are often low relative to the value of the crops grown. As a result of such expansion, deteriorated water quality may be an even more important issue than water table depletion. The issue of groundwater mining and its effect on sustainability is critical, and concerns with respect to values and ethical issues may differ between rich and poor countries. Further, the value of groundwater changes regularly. Typically, geologists determine its value based on the relation between demand and supply; however, it might not be easy to estimate groundwater recharge or define the concept of demand. The institutional issues surrounding groundwater differ from those of surface water because of the nu- merous stakeholders, and for this reason, decision makers need to invest in creating inventories of groundwater resources and their use. Social, economic, ecological, legal and institutional aspects are criti- cal. In this context, efficient institutions could rely on the water users themselves, such as the Water Tri- bunal of Valencia, created 800 years ago. Managing water rights in the Mediterranean, presented by Ms. Josefina NMaestu, Advisor to the Ministry of Environment, Spain There are five types of groundwater property rights systems, based on ownership of the resource. These include (1) prior appropriation, 2) absolute ownership, (3) reasonable use, (4) proportional water use and (5) public allocation. Under the prior appropriation system, those with rights may use the resource, but do not own it. Ground- water rights are conditioned upon actual consumptive use. This implies that unused rights are returned to the public. Under absolute ownership, landowners own the groundwater below their land, and are free to use, sell or transfer it, without having to consider the needs of the other users. Under reasonable use (an American variation of the absolute ownership system, based on English common law), property holders own the resource and may use groundwater subject only to a reasonable use constraint; this is determined by a country's laws and statutes, and may vary from one country to another, and from one location to an- other in a single country. Under proportional use, surpluses and deficits are a1ocated proportionally among all users: For example, if groundwater availability is reduced 5% below normal levels, each user will receive 5% less water. Under public allocation, governments distribute groundwater rights to those who apply for them. 24v Four Pillars in Water Policy Reforms If the rights are privately owned such as in the above systems 2 and 3, there is little government interfer- ence and few transaction costs, such as in Arizona and Texas (US). However, if groundwater is publicly owned, greater administrative controls apply, such as in New Mexico (US), Spain, Tunisia and Jordan. In groundwater management, approaches can be top-down, bottom-up or mixed. In a top-down approach, where groundwater is publicly owned, such as in Jordan, Arizona and New Mexico, a central authority determines water allocation and enforces permits, and public participation is limited. Conversely, in a bot- tom-up system, where groundwater is privately owned, as in Texas, the private sector is more powerful and government can only guide the management of groundwater at the macro-policy level; in such cases, groundwater user associations and irrigation districts design policies at the micro-level. Groundwater in the ME/MED region is not regulated to any great extent. For example, the Spanish gov- ernment adopted a mixed groundwater management system, and in this way, the central authority could control all wells; participants have operational roles, but they must coordinate their activities with the River Basin Authorities. An important issue is the Authorities' capacity to enforce regulations and the perceptions of problems among different users. And, as users may view aquifer depletion levels differ- ently, cooperation with River Basin Authorities is vital. In turn, River Basin Authorities need to support users to generate knowledge and management systems. Based on the Spanish and Jordanian experiences, groundwater improvements take many years, making government assistance essential. Groundwater management in Yemen, presented by Mr. Jamal Abdo, Chairman, National Water Resources Authority In Yemen, most of the population live in rural areas and water is very scarce: Annual average rainfall is 200 mm and per capita availability for all uses is just 135m3. Wells are numerous (over 50,000) and the country's water resources are fully exploited. Since the 1980s, groundwater depletion has been a critical issue. Today, given Yemen's high population growth and the fact that 50% of the population live in 8% of the area (in the west), groundwater has been over-abstracted and the water table has dropped by 4-5 meters a year. Still, the key problem is that most people still do not have access to safe water. Water is now the Government's top priority, with the major challenges being (1) reversing existing water use trends to achieve sustainable use, (2) maximizing social and economic benefits from available re- sources and (3) providing safe and sufficient water to larger segments of society. To meet these goals, the country devised a national strategy and water policy, as well as policies for managing irrigation and set- ting quality standards. The legal and financial systems for managing groundwater, introduced in 1996, are based on a plan to increase water use to 60-80 liters/year/capita compared to the current 40 liters. In 1997, under the National Water Resources Authority (NWRA), seven local authorities were integrated to better coordinate decision-making. Further, the Government decentralized urban and rural water supply agen- cies and created local authorities-to bring management closer to the local level. An important issue is the increasing cost of water (case studies indicate that it will be $7/i3), which raises questions about users' willingness and ability to pay. Another is the implementation and enforcement of policies, plans and regulations. For example, groundwater use rights are still unclear, which adds to im- plementation problems. *25 Four Pillars in Water Policy Reforms Groundwater management in Jordan, presented by Mr. Edward Qunqar, Director, Ministry of Water and Irrigation, Jordan The water crisis in Jordan is due to limited renewable water resources, high population growth, a lack of integrated planning and management, and the increased cost of expanding the supply. The most important problems are excessive groundwater pumping, aquifer depletion and decreased groundwater levels, dete- riorated groundwater quality, misallocated water use and an unclear agenda for managing demand. To remedy these problems, Jordan developed a water strategy in 1977 and subsequent policies on groundwater, irrigation, and wastewater management. To increase resource exploration, monitoring and development, Jordan is upgrading its monitoring network, allocating priority to municipal and industrial purposes, using non-conventional water to relieve pumping for fresh water and conducting artificial groundwater recharge. To protect and sustain the resources, the country has banned the drilling of wells, as well as groundwater abstractions without licenses and permits; it has also installed protection zones and upgraded water quality laboratories. Further, it is emphasizing the role of the private sector in manag- ing water and wastewater services, restructuring water agencies, conducting public awareness campaigns, taking legal steps against illegal drilling, and creating a Planning and Monitoring Unit to oversee the per- formance of private sector operators. Finally, it is using financial and economic mechanisms to control exploitation such as tax deductions on water saving devices and fees for over-pumping. Also, it is intro- ducing commercially-based financial systems in the water sector. To date, some accomplishments include (1) increased use of non-conventional water, (2) a reduced num- ber of Ministry staff, (3) modified water sector laws so as to allow for private sector participation and commercially-based management contracts, training programs and public awareness campaigns, an im- proved groundwater monitoring network, a law to control and regulate abstractions, and a 12% increase in wastewater tariffs in Greater Amman and Zarqa governorates. However, improving the monitoring network is an ongoing process and the Government's future strate- gies will focus on achieving greater water efficiency, enhancing stakeholder participation and developing more public awareness campaigns. Managing the shared Nubian Sandstone aquifer, presented by Dr. Khaled Abu-Zeid, CEDARE.* The vast Nubian Aquifer, shared by Egypt, Libya, Chad and Sudan, is non-renewable. Population growth and intense drilling activity have recently caused the water table to decline, threatening its long-term sus- tainability. Thus, the four countries agreed to a plan for sustainable use that will (1) create an enabling environment for devising a regional Nubian aquifer development strategy and then implementing it, (2) build the capacity of national institutions and professionals, (3) and integrate social and economic factors for a holistic vision of the aquifer's development. Under the new regimen, the countries agreed to monitor and record the aquifer's water table. To this end, they developed a regional information system (including a GIS) and conducted environmental assess- ments of current and future practices of groundwater extraction. Based on the information, models were developed for future water use and criteria. They also agreed that they must study the socio-economic 2644 Four Pillars in Water Policy Reforms aspects related to the aquifer so as to understand the culture of local communities and test the suitability of development plans, thereby avoiding resistance from the populations. In addition, they will complete a framework for implementing the strategy, pursue a dialogue to establish legislative mechanisms, create a detailed aquifer- monitoring system using isotopes, remote sensing and numerical models, and produce a regular aquifer status report. *CEDARE is the executive agency responsible for developing the strategy and coordinating the coun- tries' efforts. Managing a shared aquifer in North Western Sahara, presented by Mr. Rachid Taibi, OSS The North Westem Sahara Aquifer spreads across Algeria, Tunisia and Libya. As a result of over- abstraction, its water table has rapidly declined, which has led to high salinity levels. Another major prob- lem is access to water because the aquifer is surrounded by sand dunes. To overcome these problems, the Sahara and Sahel Observatory (OSS) established a coordination unit among the three countries to syn- chronize joint efforts to best manage the shared resource. OSS developed a model that indicates water scarcity will not abate if over-abstraction is not reduced. The unit identified actions to minimize risks, such as decreasing interference among the three countries sharing the aquifer and restricting the quantity of water each can withdraw. The countries have also identified geographic areas where extraction is per- mitted or restricted, based on the consequences to each. A basic plan that aims to prevent interference among the three will be established in 2003. 4.1.3 Discussion themes ogy saves water, it might be better to reduce the non-beneficial evaporation in transporta- Information availability and reliability. tion systems and avoid vertical expansion at Data must be reliable and transparent if the basin level. groundwater is to be managed sustainably. Although information about illegal wells is Conditions for controlling groundwater. often poor, the Internet can be a useful tool Jordan has shown that water laws must exist for improving data quality. and be enforced if the level of groundwater abstraction is to be reduced. However, User participation in managing groundwa- drought can create strong reactions against ter. The participation of water users is criti- controls. cal to improving the management of the resource. Also, governments can play a sig- Implementing new water regulations may nificant role by establishing the proper legal take a long time. Thus, awareness-raising and institutional framework. For example, campaigns, information sharing and confi- Jordan chose a top-down approach, but dence-building measures among all parties WUAs work with the government on water are important if participatory groundwater projects. management schemes are to succeed and groundwater abstraction is to be reduced. Reducing net water abstraction or vertical expansion at the basin level. Water conser- Management of non-renewable groundwa- vation is a complex issue in groundwater ter resources. Coordination mechanisms use. Although improving irrigation technol- among countries as well as restrictive meas- *27 Four Pillars in Water Policy Reforms ures are needed to ensure the sustainable 1 meter a year. Other constraints include management of non-renewable shared budgetary and investment limits. groundwater resources. In addition, Egypt and Libya established a For example, with respect to the Nubian aq- joint authority in 1992 to study the Nubian uifer, countries agreed not to withdraw more aquifer. Chad and Sudan have recently than 5 billion m3 of water a year. This joined and the four countries agreed to amount was calculated by simulating new monitor the aquifer and share information economic activities with the constraint of on specific wells. not lowering the water table by more than 4.1.4. Issues, actions and recommendations Issues * Institutional aspects of groundwater management are important. * User participation is crucial for successfully managing groundwater. Governments should provide proper incentives to encourage stakeholder participation. * Education and public awareness about groundwater abstraction is vital. * Securing net water savings from irrigation loss is critical. * More efforts should be made to collect reliable data and information on groundwater resources. Actions * Transfer new technologies and strengthen the monitoring network. * Launch public awareness campaigns and training programs for managing groundwater. * Update laws, policies, regulations and controls. * Enhance stakeholder participation. * Expand the role of the private sector. * Design and implement a framework for water rights and inter-sectoral water allocation. * Improve water use efficiency in all sectors, particularly in irrigation. * Consider the social, economic, ecological, legal and institutional aspects of groundwater use as well as hydro-geological issues. 2844 Four Pillars in Water Policy Reforms Recommendations * The institutional and technical aspects of groundwater management must be stressed. * Reinforce regional support from countries and international organizations, which is critical to the exchange of experience and knowledge. * Countries and partners must discuss incentives and mechanisms for regional water efforts. 4.2. Water, Agricultural Policies and Food Security 4.2.1 Introduction rity rather than food self-sufficiency by find- ing ways to export high-value crops and In an effort to address the issue of growing import crops with high water content. This food demand and limited water supplies, this will require agricultural policies that are session examined several key topics such as more comprehensive and consider issues (a) the relationship between water scarcity such as agricultural infrastructure, scientific and food production; (b) food security research, innovations, rural poverty and within the context of trade liberalization; links to national and regional economies. and (c) the impact of alternative water poli- cies and investments on water supply and 4.2.2 Summary of presentations demand. Five presentations were made, focusing on Most of the countries began their economic improving the productivity of water, reduc- reforms in the early 1990s, which helped ing water shortages, expanding the supply accelerate agricultural growth. However, and protecting the eco-system. many problems still exist, such as high un- employment, rural poverty and low agricul- With respect to productivity, speakers noted tural productivity, which require even bolder that it could easily be doubled by applying and deeper reforms and actions over the techniques such as supplemental or deficit long-term. irrigation, water harvesting and biotechnol- ogy. Besides new technologies and policies, This session dealt with water resources, food it also requires a change in land use and security and agricultural policy reforms and cropping systems, including cultural prac- their linkages. Since the food crisis of 1974, tices and new types of seeds, along with efforts have been made to raise food self- timely socio-economic interventions. sufficiency, i.e. to secure enough food for the entire population, in a stable and safe To cope with water shortages and in the con- manner, either from local production, im- text of ongoing World Trade Organization ports or both. However, given the scarcity (WTO) negotiations for global agricultural of water in the region, water rather than land reforms, the region is already importing productivity has to be maximized. Thus, "virtual" water in international trade, al- countries should aim to achieve food secu- though on a small-scale (virtual water is that *29 Four Pillars in Water Policy Reforms which is embedded in food or other prod- Prospects for water availability and food se- ucts, used in their production). Trade in vir- curity until 2025 were also assessed through tual water allows water-scarce countries to the IMPACT-WATER model developed by import products that consume large quanti- IFPRI (International Food Policy Research ties of water and export those that consume Institute) it indicates that while private in- little-thus making water available for other vestments in groundwater will assume in- purposes. But agricultural trade liberaliza- creasing importance, greater investments tion and marketing reforms will also be must also be made in household water. needed to allow farmers to shift, in a signifi- cant manner, to more efficient cropping pat- Finally, the issue of protecting eco-systems terns over time; this would include shifts to in wetlands areas was addressed. A presen- fruits, vegetables, horticulture and other arid tation on the MedWet program (which crops (olives, palm) - those that are less wa- promotes integrated water resource man- ter intensive and more suited to the agro- agement at a catchment basin/watershed climate of the region. level while mitigating irrigation/agriculture impacts on natural ecosystems) observed The consequences of trade-related job losses that most countries in the region do not have would primarily affect the more vulnerable integrated policies on agricultural develop- segments of the rural population, including ment, water management and the environ- small field crop producers, subsistence ment. farmers in rainfed areas, and poor livestock herders. Thus, along with the types of meas- Some of the actions recommended include ures noted above, countries must also target the need for more research on crop breeding investments in social and economic infra- to increase water productivity, on water structure - health, education and nutrition - management techniques adapted to the re- to benefit the poor. The case of Morocco gion and on assessing the effects of liberal- illustrates this point, where the government izing agricultural trade, especially on the is investing both in agricultural productivity poor and women. and quality of life improvements in rural areas. Keynote speech: Water and Food in MED/ME in 2025, presented by Dr. Mark Rosegrant, Senior Research Fellow, IFPRI Since the MNA is arid and often experiences drought, the high economic and environmental costs of de- veloping new water resources limit attempts to increase supply. Thus, developing new supplies alone will not meet the growing demand. Instead, countries will need to reform policies and management strategies, and invest in ways to make existing systems more efficient. In assessing the future of water availability and food security until 2025, the presentation focused on (a) water availability and demand, (b) the rela- tionship between water scarcity, food production/ security; (c) the contribution of irrigated and rainfed agriculture to future food production; and (d) the impact of alternative water policies, management re- forms, including water demand and investments in water supply and food production. An integrated global water and food modeling framework, IMPACT-WATER, was applied to simulate the complex re- 30 4 Four Pillars in Water Policy Reforms lationships among water availability and demand, food supply and demand, international food prices, and trade at regional and global levels over a 30-year period. Results indicated that investment in groundwater will be increasingly important, as well as investment in household water supply, reform of water policy and using water more efficiently. Also, crop productivity must be increased through greater investments in agricultural research that emphasizes crop breeding for rainfed agriculture, and in rural infrastructure so as to improve access to markets, credit and inputs. Agriculture, water and trade presented by Ms. Shobha Shetty, Senior Economist, The World Bank The region as a whole has a deficit in food production and must increase trade to ensure its food security. Due to water scarcity and population growth (2.5% in the last decade), the region is a large net food im- porter to meet about 20% of its total needs. Some issues related to improving agricultural trade in MNA- --in the context of the ongoing WTO negotiations for global agricultural reforms and the potential for re- vitalizing trade arrangements with Europe--involve water availability and use patterns. Based on current patterns, MNA is already a large net importer of water. Through its still limited exports of less water- intensive fruits and vegetables, and growing imports of more water-hungry grains, livestock and dairy, the region is already dealing with water shortages by importing "virtual" water in international trade. The consequences of trade-related job losses are serious, since the benefits of freer trade go primarily to bet- ter-off farmers in irrigated areas and urban consumers, while large losses are felt by the more vulnerable among the rural population, such as small field crop producers, subsistence farmers in rainfed areas and poor livestock herders. Since the rural workers threatened by displacement (due to the liberalized im- ports) are disproportionately women, the gender issue must also be addressed. Packaging the transition process to accommodate such constraints and designing safety nets could ensure that trade reform in agri- culture is a politically viable alternative. Agricultural trade liberalization needs to be viewed as a medium to long-term process, with adequate consideration of social and political consequences, and careful plan- ning of sequencing, adaptation, financing and implementation of actions. Water and agricultural productivity, presented by Dr. Theib Oweis, Senior Irrigation and Water Management Scientist, ICARDA The most viable option to cope with water scarcity is to substantially increase agricultural water produc- tivity. At present, water, not land, is the limiting factor for improving agricultural production. Maximizing water productivity, not yield per unit of land, is thus a better strategy for on-farm water management. Changing this focus will require not only new technologies and policies to manage water but also a change in land use and cropping systems. Strategic research on field crops, such as cereals and legumes, shows that water productivity can be substantially improved and sustained only through the integrated management of farm resources. Water use-efficient on-farm techniques, along with improved irrigation management options, better crop selection and appropriate cultural practices, improved genetic make-up, and timely socioeconomic interventions, can help achieve this objective. Wheat productivity, which cur- rently averages 0.5 kg/ m3, could easily be doubled using techniques like supplemental and/or deficit irri- gation, water harvesting, and biotechnology. Conventional water management guidelines designed to maximize yield per unit area need to be revised to maximize water productivity. *31 Four Pillars in Water Policy Reforms Vulnerability and poverty in Morocco, presented by Mr. Ahmed Oulhaj, Advisor, Ministry of Agri- culture and Rural Development, Morocco. Rural poverty in Morocco is high. Water is the primary resource that improves agricultural production, provides food security and contributes to overall rural development. However, the availability of water varies greatly--spatially, temporally and quality-wise. Three of the country's eight major river basins-- Tensiff, Sousse-Massa, and Sud-Atlas-experience deficit conditions and this problem is expected to worsen over the next decade, adding at least another two to the list. The Government recognized the need to address the water, food security and poverty issues, simultaneously investing in (a) improving agricul- tural productivity in an environmentally sustainable manner and (b) improving the quality of life in rural areas through improved social and physical infrastructure. Through its innovative integrated and partici- patory approach to rural development, it also aims to increase stakeholder participation and enhance the sustainability of its investments. Sustainable use of water resources for agricultural development in wetland areas, presented by Mr. Spyros Kouvelis, Coordinator, Med-Wet Program, GWP-Med. Sometimes, when discussing the management of water resources, the issue of maintaining healthy ecosys- tems is overlooked. For example, natural releases of water that supply the environment's needs should be adequately maintained. MedWet is a long-term collaborative effort among 25 governments, the Palestin- ian Authority, UNEP, European Commission, Barcelona-Bern-Ramsar Conventions, eight international NGOs and four Wetland Centers to conserve Mediterranean wetlands. Agriculture affects the sustainable development of wetland areas and their catchment basins. Such impacts sorely need to be assessed, but no systematic approach exists to collect, analyze and evaluate reliable data and knowledge. Further, in most of the region, few integrated policies exist on agricultural development, water management (irrigated or rainfed agriculture and groundwater use) and the environment; also, there is little awareness and access to specialized information and support systems for water users and stakeholders (farmers, irrigators, pro- tected area managers). MedWet's goals include promoting integrated water resource management at a catchment basin/watershed level while mitigating irrigation/agricultural impacts on natural ecosystems. Also, MedWet aim to develop a methodology and tools to assess needs and address problems, build insti- tutional capacity and increase public awareness. This will be accomplished through partnering efforts; to this end, the North African Wetlands Network and the Mediterranean Irrigators Association are active collaborators with GWP-Med. 3244 Four Pillars in Water Policy Reforms 4.2.3 Discussion themes grown, and costs of establishing and main- taining treatment plants. However, it will Influence of climate change on MNA ag- become an increasingly important source of riculture. The current IFPRI model does not water for irrigation around major cities-- consider the influence of climate change be- thereby freeing up valuable freshwater for cause projections are made only until 2025. other high-value uses. However, IFPRI plans to work closely with the Inter-Governmental Panel on Climate Access to markets. Debate arose over Change (IPCC) to address such issues in an whether restrictions exist for MNA coun- expanded version of the current model. tries' exports to EU markets. Some argued that MNA countries are unable to gain ac- Importance of using treated wastewater cess because their products do not adhere to and desalination. The consensus was that EU phyto-sanitary guidelines; also, that no despite recent advances in desalination tech- transition period exists between the removal nology, which have halved costs from more of customs duties on the one hand and the than $1/m3 over 10 years ago to about imposition of phyto-sanitary restrictions on $0.40-$0.50/m3 today, it is still neither fi- the other, thus restricting MNA exports. In nancially nor technically feasible to consider addition, internally, MNA countries have as an added source of water for agriculture. had serious structural and policy constraints It is a highly capital-intensive technology; in in the context of standards, price formation most countries where desalination has been and information, storage, transport, etc., applied, the end-users are domestic and in- which have been exacerbated by bureau- dustrial. Also, use of treated wastewater, cratic interventions and inefficient public while gradually expanded in a controlled enterprises. Thus, internal reforms in market manner in Tunisia, still has problems related organization and marketing are critical to to institutional aspects, opportunity costs of enhance access to EU markets. land, legal restrictions on crops that can be 4.2.4 Issues and recommendations Issues * Increasing water productivity is key to raising food production. * Use of treated wastewater and desalination are increasingly attractive options to augment supply. * Agricultural trade and market reforms will become ever more important in the shift to more effi- cient cropping patterns that are more suited to the agro-climatic factors of the region and less wa- ter-intensive. . Liberalizing agricultural trade will entail significant transition costs, particularly for the poor. *33 Four Pillars in Water Policy Reforms Recommendations * More research is needed on crop breeding and improved water management techniques, adapted to the region. * Water subsidies must be targeted to the poor. * Rural investment in social and economic infrastructure - health, education, and nutrition - is es- sential. * Reforms in marketing and market organization should be pursued to increase exports to devel- oped countries. * A proper assessment is needed of the costs of agricultural trade liberalization, especially on the poor. 4.3. Institutional Reforms: Decentralization and Public-Private Partnerships 4.3.1 Introduction PPPs, which included lessons from a series of Water Demand Management forums or- The fiscal burden of the state and the need to ganized by IDRC and held in a few MNA modernize water services in the face of se- countries in 2002-2003. Case studies from vere competition for the resource are stimu- Jordan and Morocco were presented. lating MNA governments to look for institutional and financing alternatives. Min- Talks focused on the need for private istries of water are beginning to consider sources of funding, given the huge financial private sector options to replace govern- requirements when developing and manag- ment-managed water entities and to improve ing water resources. However, substantial public sector capacity in essential functions. effort will be needed to achieve this, because Private sector participation (PSP) has been until now, PPPs have been limited to water seen as a way to improve the sustainability management rather than financing. Further, and efficiency of water services; a few cases most of the experiences have been drawn of PSP already exist in the MNA region from urban water supply and sanitation (Jordan and the West Bank-Gaza). rather than management. At the same time, interest in PPP for irrigation is growing, However, when ministries examine PSP op- with a pilot project underway in Morocco tions, issues arise with respect to the (a) in- (see box below). stitutions and laws needed to attract the private sector, (b) performance and evalua- Several recommendations emerged from the tion of the companies and (c) social conse- presentations/discussions. These were (a) quences of privatization on the poor. Given political support is vital when countries these questions, it is more relevant to con- launch institutional reforms, (b) MNA coun- sider public-private partnerships (PPPs) and tries can draw upon Asia's decentralization focus on issues of decentralization, good experiences, (c) reforms must be introduced governance and user participation. immediately since institutional change is a long process and (d) lack of coordination 4.3.2 Summary of the sessions among agencies as well as high population growth and low public awareness present Global, regional and country-based presen- obstacles to decentralization. tations were made on decentralization and 3444 Four Pillars in Water Policy Reforms In addition, laws need to be passed and/or water and cost savings, service improve- strengthened to achieve decentralization and ments, and the role of women are also essen- PPP. For the former, governments should tial. As for PPP, capacity must be built to increase pilot projects that include signifi- monitor the performance of contracts, un- cant user participation, at the same time as derstand the options for third party guaran- they acknowledge the constraints to mobiliz- tees to cover risks, and establish cost- ing it. Efforts to monitor performance on effective mechanisms to resolve disputes Water demand management, presented by Dr. Ellysar Baroudy, IDRC Water scarcity, poor quality services and unsustainable water management practices are the driving forces for the International Development Research Centre's (IDRC) activity in MNA. To meet these challenges, the IDRC promotes various strategies through the Water Demand Management (WDM) Forum. Its short- term objective is to help decision makers realize that WDM is a viable course through which to manage supply; the long-term objective is to devise policies and programs to support WDM practices. Four WDM sessions were held on wastewater, PPP, decentralization and water valuation. Countries view the use of wastewater as a valuable option if health and other socio-economic considerations are re- spected. However, in many cases, wastewater is used without being treated. PPP was examined as it oc- curs in irrigation; because it is relatively new in the region, lessons and guidelines must be continually exchanged. With decentralization, there is still little monitoring and evaluation. While responsibility and ownership of water resources management is now greater in the region, decision makers and stakeholders need to be more involved. Finally, a few countries in the region have adopted the water valuation princi- ple to varying degrees, adapting it through an evolutionary process which may be of interest to other countries that are still exploring the valuation option. Integrated water management, presented by Mr. Abdelkader Hamdane, Tunisia Institutions in MNA are characterized by a top-down decision making approach, little awareness of water rights, government-monopolized water management, weak regulations, and slow movement towards re- form. With respect to the last issue, political willingness is vital, since new roles need to be assigned and regulations introduced. When creating an integrated water resources strategy, the following should be considered: )Transparency: The government needs to clarify the allocation decisions and environmental concerns; good governance of water services is critical. -Decentralization: Policies and plans must be set at the national and regional levels. kLegislation: Coherent and unified laws should be passed that determine water rights; regulations need to include water quality standards to protect human health. WEconomic instruments: Economic and financial incentives should be clearly identified. The two types of PPP in water services include (a) institutional or regulatory governance monitored by a public body, where the operator has little autonomy and (b) a contract mechanism based on an agreement '.35 Four Pillars in Water Policy Reforms between the public authority and private sector, where few institutional arrangements are needed but vari- ous regulations must exist. The institutions must be economically, ecologically and environmentally effi- cient. When implementing institutional reforms it is important to (a) increase public awareness, (b) obtain effec- tive user participation (particularly for daily maintenance) and (c) provide regular training to all stake- holders based on their specific needs. The performance of the new institutions must be monitored, so as to achieve further changes and re-evaluate actions. For the entire effort, political willingness is vital. Comparative experiences in managing decentralization and participatory irrigation in MNA, pre- sented by Mr. Qahtan Abdul-Malik, Yemen. This presentation was based on the Water Demand Management forum held in Egypt in 2003, whose par- ticipants concluded that little information and few mechanisms exist with respect to monitoring and evaluating decentralization programs. However, they noted considerable improvements in water man- agement in MNA at the farm level. Farmers' participation in the management of irrigation can take several forms, including water user groups, water user boards, water user associations and agricultural federations; also, the level of participa- tion is defined according to the size and type of the project. The participation of farmers can have posi- tive impacts at the technical, economic, institutional, social and legal levels. For example, it has increased efficiency in irrigation projects, reduced the amount of energy consumed, increased the areas served by water users and helped prevent water pollution. In addition, it has led to a transfer and reduction of O&M costs from the govemment to water users. In terms of social impacts, farmers' participation contributed to raising their sense of responsibility and reliability. An important lesson has been with respect to having an appropriate framework for adopting decentralized management; also, that incentives are needed to mobilize commitment and resources both from the gov- ernment and users. This would help optimize the irrigation systems and increase the productivity of water where irrigation schemes need to be improved. However, a few factors limit the full participation of farmers in managing irrigation resources, including (a) poverty and over-reliance on govemments, (b) lack of infrastructure, community resources and capac- ity building, (c) illiteracy and little sharing of knowledge among water-related projects, (d) lack of under- standing of participation and gender issues and (e) inefficient water use. Decentralization in Asia and links with ME/MED experiences/strategies, presented by Dr. Tsugi- hiro Watanabe, Research Institute for Humanity and Nature, Ministry of Education, Culture, Sports, Science and Technology, Japan Lessons were offered from the Asian experience on managing decentralized irrigation and highlighted the role of district level organizations. In Japan, irrigated paddy areas are institutionally divided into land improvement districts (LID); these have hierarchical structures, with farmers' water users' associations (WUAs) at the bottom tier, based on rural communities or traditional villages. The LIDs are responsible for constructing and rehabilitating small-scale facilities and allocating the distribution of water among users to achieve a stable water supply 3644 Four Pillars in Water Policy Reforms and more efficient water use. They are also responsible for O&M of irrigation facilities whereas national or local governments are in charge of constructing them and managing large-scale projects such as reser- voirs or diversion works. In O&M, LIDs control the structures and canals above the tertiary level, while farmers' associations/groups and individuals operate and maintain all facilities at the tertiary and on-farm levels. The WUAs and LIDs succeed because of their democratic organizational structure and decision-making process: Individual farmers elect representatives to an assembly of representatives. Farmers have a sense of ownership in irrigation facilities and of belonging to the LIDs. They also are willing to share the O&M costs and enjoy good relationships with government organizations. All LIDs have a federation at the local and national levels. In China, the government organization responsible for O&M of irrigation schemes has been restructured as an independent project agency. Farmers' associations operate and maintain tertiary-level facilities and the farmers receive water by paying a fee to the agency. However, the facility's ownership and responsi- bility for O&M are not clearly transferred. The relation of the project agency with the WUAs has become a top-down system, resulting in inappropriate management (for example, the head of the WUA is often appointed by local government, thus not representing the farmers' interests). Still, the situation is chang- ing rapidly. Lessons from these experiences are that (a) tertiary-level associations are vital to the O&M of irrigation facilities, (b) district-level non-governmental organizations (NGOs) whose task is to manage irrigation systems can replace governmental organizations, and (c) cooperation from the NGOs must be well organ- ized, if their performance is to be secured and improved. When establishing strategies, these issues must be considered: (a) Which level of organization should be legally authorized? (b) Which should be established first-the district or tertiary level association? (c) To what extent do farmers have a sense of ownership? *37 Four Pillars in Water Policy Reforms Governance in the Mediterranean countries, presented by Mr. Vangelis Constantianos Executive Secretary GWP-Med. In 2001, GWP-Med started a series of dialogues on the subject of effective water governance, in order to promote communication among stakeholders, such as politicians, MPs, local authorities, media represen- tatives and academicians in the Mediterranean countries. Some of areas discussed were (a) policy and institutional reforms, (b) laws and their enforcement, (c) participatory processes and empowering civil society and (d) financial instruments and incentives. The problems raised by the dialogues were the frag- mented institutions, inappropriate laws, lack of financial resources and limited accountability and trans- parency. While decentralization models differ among regions, similar concerns are collaboration and accountability from both providers and users. Awareness encourages participation, ownership, responsibility, and of course, accountability. Decentralization is not just the process of municipalization, but one where local governments become ef- fective and properly harmonized within the national institutional context. However, because local gov- ernments have limited financial capacity to run services properly, it is necessary to (a) promote an integrated approach to basin management,, (b) strengthen local frameworks, (c) develop local capacity, (d) strengthen local water user associations, (e) enhance participatory processes and (f) develop local fi- nancial instruments. In 2003, activities will include continuing the dialogue with MPs and the media, assessing water laws in the Mediterranean countries, beginning a dialogue in the Balkans and facilitating dialogues at the national and River Basin Organization (RBO) levels. Private sector participation in managing water resources in Morroco, presented by Mr. Mokhtar Bzioui, Director of Research and Water Planning, Ministry of Land Use Planning, Water and Envi- ronment, Morocco Like most Arab countries, Morocco suffers from low and irregular rainfall distribution. Rainfall has de- clined over the past years, possibly due to global climatic change, and it is difficult to predict future trends. Average per capita water availability is about 1,000 m3 and is expected to drop to 745 m3 by 2020. Further, water pollution caused by untreated wastewater, solid waste and fertilizers is a major problem. Also, soil erosion is causing reservoirs to fill up, diminishing their capacity to store water. Several factors account for the losses and inefficiencies in the water sector, including outdated technologies, lack of pub- lic awareness, low water tariffs and limited budgets. Pushed by the lack of financial resources and limited water resources, the Rabat-Casablanca coastal re- gion decided in 1995 to launch a PSP project. As a result, two private companies were given concessions to provide water to the population. The 30-year greater Casablanca concession invested US$2.1 billion in water supply and sanitation and is committed to improve distribution efficiencies by 15% in 15 years. The Rabat water supply concession invested US$1.5 billion and aims to achieve an efficiency rate of 85.5% in 20 years. The companies replaced meters, detected water losses, eliminated non-metered connections, reviewed potable water tariffs and introduced sanitation tariffs (0.2 US$/m3). As a result, water consump- 3844 Four Pillars in Water Policy Reforms tion dropped by lOm m3 in Casablanca from 1998-2000. This indicates the private sector can manage wa- ter demand--a critical ability because of water scarcity and financial constraints. However, private sector interventions need to occur in a controlled framework in order that public services are provided at socially acceptable costs. Private sector participation in managing water resources in Jordan, presented by Mr. Mohammed Najjar, Ministry of Water and Irrigation, Jordan Water scarcity is the most important natural constraint to Jordan's economic growth. The country suffers from limited water supplies and is among the lowest on a per capita basis. Current demand is not met, already exceeding the renewable water resources; and, the cost of developing new water resources is ris- ing rapidly. Some of factors contributing to the crisis include (a) high population growth that caused cities to expand and increased demand, (b) limited renewable water resources with deteriorating quality, (c) inefficient water delivery services, (d) low cost recovery for irrigation services, (e) excessive groundwater pumping and (f) competition between sectors for water. After the Ministry of Water and Irrigation was created in 1988, the National Water Strategy and Policy papers were adopted; these contained guidelines to protect water quality and improve resource manage- ment and perfornance efficiency, especially by introducing PSP. A Planning and Management Unit was created to prepare PPP contracts and provide economic incentives that would make the projects attractive to the private sector. The first PPP transaction was the Amman Management Contract, a four-year arrangement for water and wastewater services in greater Amman. Signed in 1999, it will extend until the end of 2005. The project has yielded good results in terms of efficiency, finance and education. In particular, UFW was reduced, networks are better maintained, staff training was enhanced, and credibility with customers was restored. Other forms of PPP will be launched in the near future such as the As-Samra wastewater plant under BOT, the Disi BOT project, the Zara Ma'en water desalination project, the Aqaba water company, and the Northern Governorates Management Contract. Mobilizing financial resources and attracting investment/public-private partnerships, presented by Mr. Mohammed Benblidia, President, Mediterranean Water Institute Faced with a dramatic increase in the number of people needing safe water and sanitation in the near fu- ture, MNA countries increasingly seek ways to augment private financial resources. Three types of fund- ing sources include: (a) public funds, the largest coming from state budgets or domestic and/or foreign development loans, (b) self-financing, where individuals pay for themselves, say, with water utilities and (c) private funds, such as from industries, private concessions and other users. This latest source repre- sents the smallest portion in the region. Public funds are no longer sufficient and have already reached their limit-the only option is to use them more efficiently. With self-financing, the price of services can be progressively increased, which may be accepted by users, but depends on the situation. Thus, although PPP schemes have not been fully explored in MNA, these private sources may be the most attractive alternative. PSP will not happen immediately, since there is much resistance to allowing private companies take over water services. Public opinion may be against PPP in financing investments because it fears the social consequences of privatization on the poor. Also, the private sector may not be keen to invest in water ser- "39 Four Pillars in Water Policy Reforms vices because revenues may not be attractive enough, financial risks may be substantial and the price of services may be subject to government control. Also, currency devaluations create other risks and, in turn, make it difficult to attract foreign investors. Thus, the proper conditions and enabling environment need to be created to motivate national and foreign PSP to finance water investments. At the institutional level, this means strengthening the public sector capacity to deal with PSP. At the financial level, it means providing currency guarantees and working closely with international financial institutions for risk guarantees. Specific local and social conditions must also be considered when introducing PSP. Finally, local communities and WUAs must be encour- aged to take part in private sector schemes. For PPP arrangements to succeed, the end-user must be closely involved at all stages. 4.3.3 Discussion themes intervention that is appropriate in order to adopt the right level and form of decentrali- Participatory management. Cases from zation. China, Egypt, Morocco and Tunisia demon- strate that stakeholders must participate in Consumers' needs vis-ti-vis PPP. Experi- order to improve the management of water ences from around the world indicate that resources. China has promoted privatization failures at the early stage of the privatization reforms in irrigation to save water in arid process are due to a lack of participation areas. Particularly in tertiary level organiza- from water users. Thus, all stakeholders tions, farmers are encouraged to save water must be actively involved when PPP by purchasing it from water agencies. Al- schemes for water services are designed and though the country has adopted a top-down introduced. approach to managing water resources, farmers are participating in irrigation PPP investors' concerns. Private entities schemes through WUAs and, as a result, considering whether to invest in water ser- large amounts of water have been saved. vices want their needs to be understood and addressed. Generally, they seek some sort of In Morocco and Tunisia, participation of risk-sharing between public entities and pri- users in implementing and operating water vate companies in the form of guarantees projects, coupled with their having a share in from governments or financial institutions. the investment costs, has led to greater ac- To achieve this, a third partner could help cess to safe water in rural areas. For exam- reduce risks and improve the guarantee con- ple, in rural Morocco, such access has ditions: For example, MIGA provides guar- dramatically increased from 14% in 1995 to antees and mediation services to foreign 50% today. investors and creates legal and investment frameworks. Also, mechanisms need to be The progressive nature of reform. The de- created to resolve investment disputes, espe- centralization process is a political and cially when investors have complex struc- socio-economic process, one which takes tures. time to materialize. Also, the reform process is dynamic, and as such needs to incorporate Australia offers several lessons from its PPP the local characteristics of water resources. irrigation projects. First, experts must carry It is important to consider the type of State out broad and accurate market research to 4044 Four Pillars in Water Policy Reforms determine if private investment is feasible. Governments' role in setting tariffs. Be- Second, interested countries must rapidly cause tariffs are a sensitive issue in most create the necessary laws and institutions to countries, governments often prefer to sub- attract potential investors. Third, customer sidise rather than increase them. To explore contracts need to include clear rules and the issue adequately, authorities need to regulations to ensure transparency in trans- conduct studies to examine consumer con- actions and provide guarantees to minimize cerns and the social impact of new water risks. tariffs. 4.3.4 Issues, actions and recommendations Issues . Institutional reform is a social project and takes a long time to design and implement. . The rationale for decentralization is the urgent need to save water and finances. Although few exam- ples of decentralization exist in the region, countries can leam a great deal from experiences in other parts of the world, such as in Asia. . The increasing interest for private sector financing in MNA stems from the huge amount of finances needed to develop/manage water resources. Recent experience with PPP has been largely with water management rather than financing, and has focused on urban supply and sanitation. Today, interest is growing in PPP options for irrigation, and a couple of pilot projects are underway. . PPP activities need to take account of their effect on people. . Private investors require risk-sharing opportunities, some types of guarantees and an environment conducive to PPP. Actions and recommendations . Obtain political support from MPs by clearly describing the benefits of institutional reform; also se- cure media support. Since reforms take time to develop, create a long-term perspective. . For decentralization, support scaled-up pilot projects that include significant user participation; rec- ognize the constraints to mobilizing local participation; obtain information to monitor performance on water and cost savings, service improvements, and the role of women. . For PPP, build capacity to monitor the performance of contracts; learn about various options for third party guarantees to cover risks; develop cost-effective mechanisms to resolve disputes. . Develop new laws and, where necessary, reform/enforce existing laws that pertain to decentralization and PPP. . Develop and disseminate tools to implement water demand-management programs. . Promote cost-effective ways to share experience with all stakeholders at the regional level; also pur- sue national-level consultations for sharing experiences. 1*41 Four Pillars in Water Policy Reforms 4.4 Non-Conventional Water Resources 4.4.1 Introduction suffer from excessive salinization of irrigated lands. Despite measures to conserve water, in some MNA areas, demand will outstrip supply. In recent years, the World Bank, along with Thus, the possibilities for non-conventional other stakeholders, has sought to raise water resources must be assessed. These decision makers' awareness about the include desalination, along with using development and management of non- wastewater and brackish water for irrigation conventional water resources. To this end, it (bio-saline agriculture). held a workshop on the use of wastewater and conducted a regional study on Desalination measures were originally desalination. confined to the wealthiest countries, but the cost of large seawater desalination plants has 4.4.2 Summary of presentations dropped to under US$1 per cubic meter-- from US$.50-US$.90. Further, the cost of Dr. Ali Altokhais, Deputy Minister for Wa- brackish water desalination is about half that ter Affairs, Saudi Arabia, who chaired the amount. Meanwhile, the higher costs of session, and Dr. Amadou Cisse, Vice- securing new freshwater are eroding the President of the Islamic Development Bank price difference between conventional and (IDB), keynote speaker, focused on the chal- desalination projects, while due to increased lenges imposed by water scarcity, the need droughts, there is now a premium on reliable to manage demand and develop new sources sources such as desalination. of supply, including non-conventional water. Dr. Cisse noted that the IDB had invested in With regard to wastewater, treating and the water sector over the past few years, but using it for restricted irrigation purposes can had moved gradually away from irrigation to conserve resources and reduce pollution. water supply/sanitation projects, based on Particularly in agriculture, the use of treated the region's needs. The IDB also supported wastewater and drainage water can release a new research center for salt-tolerant crops freshwater for higher-value activities and (ICBA) so as to increase crop production in reduce fertilizer consumption. The cost of saline lands. treating wastewater for irrigation is US$0. 10-US$.50 per cubic meter, and in Both stressed that desalination should be some cases, is an attractive option vis-a-vis integrated with the management of demand other sources of supply. and supply: For example, efforts to develop and manage non-conventional water need to Finally, biosaline agriculture has become an be linked with capacity building, training interesting option to countries disposing of and studies on demand-supply issues. The unused brackish water (naturally brackish environmental effects of desalination can be groundwater and springs, or drainage water mitigated at reasonable costs and private disposed to the sea or salt pans) and which sector participation can be beneficial. 4244 Four Pillars in Water Policy Reforms A two-pronged approach to using treated For example, salinity guidelines that are un- wastewater is needed so as to address each necessarily stringent impede the use of country's conditions, which, in turn, affect brackish surface and groundwater and slow the development of consistent and realistic research on salt-tolerant crops. standards. Trends in desalination, presented by Adel Bushnak, Bushnak Water Group, Jeddah. Trends include the declining cost of desalination measures, its recent spread outside Gulf countries, and increased reliance on the private sector to finance and operate desalination plants. Also, technologies ap- plied in desalination have recently become more energy-efficient. Environmental impact assessments are needed of brine discharges from desalination facilities. Further, demand must be vigorously managed through sensible tariffs, leakage controls and increased public awareness. Also, it is important that capacity be strengthened through research, development and training, building on existing institutions such as the Middle East Desalination Research Center (MEDRC) in Oman. Desalination in the Middle East, North Africa and Central Asia, presented by Mr. Jeroen Kool, DHV The World Bank's ongoing regional desalination study aims to improve the understanding of recent trends. It analyzes the role of the private sector, impact of desalination costs on different economic sectors such as agriculture, environmental effects, affordability and social impacts, and recent technological trends and developments. Desalination stimulates water demand management, since its higher cost may trigger conservation measures. Use of wastewater, presented by Dr. Akissa Bahri, National Research Institute for Agricultural En- gineering, Water and Forestry, Tunisia Most wastewater in the region is not adequately treated and is either discharged into the sea or used in an unsafe and unhealthy manner. While the amount of sewage is expected to double in the next 15 years, the planned use of reclaimed water is still in its infancy in Arab countries and Iran. Moreover, it can only oc- cur if a number of conditions are met. These include the (a) adequate and reliable treatment of wastewa- ter, which, in turn, depends on the existence of strong and financially viable utilities, (b) existence and enforcement of quality standards for reclaimed water, (c) arrangements to recover at least the recurrent costs of storing and transferring reclaimed water and (d) effective arrangements for inter-institutional co- ordination. In many countries, the enforcement of crop restrictions, improvements in treatment, and awareness cam- paigns directed at farmers are the most urgent steps needed to protect public health. In countries with bet- ter track records, the restrictions should be lifted to allow (a) higher value crops to be cultivated, (b) costs to be recovered more effectively and (c) formal partnerships between utilities and WUAs to be created. *43 Four Pillars in Water Policy Reforms Best practices in non-conventional water management in Cyprus, presented by Dr. Chrysostomos Kambanellas, Cyprus In Cyprus, desalination and the use of wastewater were recently introduced in the context of an integrated water resources management approach. Until 1974, Cyprus relied exclusively on groundwater, which caused its resources to be over-exploited. After this, surface water was used, followed by desalination in 1997, with two plants (one each in Dhekelia and Larnaca). The plants were executed under BOOT schemes and operate throughout the year; the two have eliminated urban water shortages, which is critical for the health of the large tourism industry. Peak summer demand is satisfied by the release of surface water from reservoirs. Desalinized water now provides 55% of the urban water supply, as opposed to 21% for groundwater. High water tariffs provide an incentive to save water and the finances to pay private operators of the plants. Other demand management measures in- clude subsidies for using marginal quality water, such as shallow groundwater and gray water, for some household needs. In addition, treated wastewater is used to irrigate landscape and agriculture. Irrigation with saline water for sustainable agricultural production, presented by Dr. Donald Suarez, USDA-ARS, Riverside CA, & Dr. Kauser Malik, Nuclear Institute for Agriculture and Bi- ology, Faisalabad, Pakistan The two speakers introduced the new field of biosaline agriculture, which is defined as "the profitable and integrated use of genetic resources and improved agricultural practices to obtain better use from saline land and saline irrigation water on a sustained basis." The new process assumes saline ecosystems to be a productive resource. Given the substantial amount of naturally brackish groundwater, the problem of salinization of irrigated lands (up to 40% of irrigated land in some countries), water logging and large amounts of saline water from rivers lost to the sea, agriculture could benefit substantially if these mar- ginal resources could be better used. From the Nile River alone, 2-4m hectares of land could be irrigated with brackish water that is currently being lost to the sea, thereby doubling the Egypt's irrigated area. Some benefits from using saline water include conserving the fresh water supply, controlling regional water tables and increasing irrigated areas and total production. Measures recommended include revising overly strict salinity guidelines in irriga- tion, developing more salt-tolerant crops, improving crop rotation, lining irrigation canals with gypsum stones and increasing the use of micro-irrigation techniques. However, controls on discharging drainage water must be enforced to ensure that it is not mixed with non-saline water. The creation of the Intemational Center for Biosaline Agriculture (ICBA) in Dubai was a promising step in promoting research and building capacity for this new alternative. 4444 Four Pillars in Water Policy Reforms 4.4.3 Discussion Themes Health and environmental impacts of Solar energy and desalination. Given high- treated wastewater. Use of treated wastewa- energy costs associated with desalination ter in MNA is still resisted by consumers plants, renewable solar energy is an attrac- because of its effects on health. For exam- tive option, considering its abundance in the ple, groundwater recharge with treated region. In addition, it involves no mechani- wastewater could cause aquifers to be con- cal or chemical processes, thus reducing taminated, and is a very sensitive issue. negative environmental impacts. However, Some participants argued that the effects of because solar power is more expensive than using treated wastewater on health are still conventional power, further research on the unknown and more studies are needed. subject is needed. Costs associated with treating wastewater The search for integrated solutions. Aqui- are high (transportation, storage, level of fer storage could help make better use of treatment required to reach a specific water non-conventional sources, given substantial quality, etc.). Thus, it is important to com- seasonal fluctuations in demand. Thus, in- pare the cost effectiveness of all solutions. novations must be looked at in an integrated manner, taking into account all water re- Biosaline agriculture. An important issue is sources management practices. the technical and commercial viability of biosaline agriculture. As with desalination, it Technology developments in nonconven- is important to compare the use of saline wa- tional water. Membrane technology has de- ter with other sources of supply. Also, the veloped considerably but it is still current price for irrigation water in some expensive. However, prices are expected to countries does not provide incentives for decline further and this will become an in- farmers to use saline water. creasingly used technology in desalination plants. 4.4.4 Issues, actions and recommendations Issues Non-conventional water resources will play an increasing role. . The cost of desalinating water has declined and it is a more reliable resource in a time of climate change; the use of desalinated water needs to be linked with demand management and capacity building. . A two-pronged approach to the use of treated wastewater is needed. It must consider conditions in each country as well as improved treatment methods, and then develop consistent and realistic stan- dards. . With respect to biosaline agriculture, salinity guidelines are unnecessarily strict, and impede the full use of brackish surface and groundwater. Additional research is needed to develop salt-tolerant crops. 0*45 Four Pillars in Water Policy Reforms Recommendations . The use of non-conventional water resources must be better integrated in national water policies. . With respect to using wastewater, a working group with specialists from developed and developing countries must be created to reconcile standards based on toxicological and epidemiological studies. Actions . Experiences in the use of non-conventional water must continue to be shared among research insti- tutes (ICBA, MEDRC and others), regional governments, networks (GWP-Med) and donors. 4.5 Issues in the Stakeholder Panel and Thematic Sessions In the last session of the Day, rappoteurs, activity (Dr. Houria Tazi Sadeq from panel members and the audience discussed ALMAE). the issues raised in each thematic session. ... cn . Water cannot be saved in irngation activities These include the following: unless farmers change traditional practices. New laws alone will not foster change; 4.5.1.rManagingbgound watuer: Law efr rather farmers will need to be encouraged to trans-boundary issues and efficiency aotmdr ehoois(..Bha improvements ~~~adopt modern technologies (H.E. Bahram Aminipouri from Iran). Issues raised in the groundwater session in- volved the (a) institutional aspects of man- Many farmers do not have the knowledge to aging the resource, (b) capacity building and properly use fertilizers and other moder (c) international cooperation and partner- techniques, which limits their prospects to ships (including the role of interna-tional increase productivity. Also, pastoralists organizations) to deal with trans-boundary (who cultivate crops differently than settled matters. populations) in some countries will need to With respect to shared groundwater re- adapt to new irrigation management sys- sources, these are not covered well in inter- tems. However, if laws change and subsidies national law since there is no clear are applied, particularly in low-rainfall ar- understanding about their legal status. Na- eas, this could increase agricultural produc- tional laws provide rules and regulations on tivity. Thus, special attention must be given exploitation withi eachcountry,butnonto farmers' education and research, particu- expist atione wegitina leah t counitry buto larly for rainfed agricultural areas. (Dr. Eglal exist at the regional level to monitor such Rached from IDRC) 4644 Four Pillars in Water Policy Reforms 4.5.2. Water, agricultural policies and may not be prepared to adopt competitive food security; protectionism in ag- techniques due to strong traditional practices riculture; new cultivation practices and water scarcity. The challenge is to find a balance between traditional cultivation Issues emerging from the water, agricultural methods and sustainable development, and policies and food security session include (a) competitiveness and productivity (Dr. agricultural subsidies imposed by developed Youssef Nouri Co-chairman, Mediterranean countries, which restrict market access by Information office for Environment, Culture countries of the region and diminish their and Sustainable Development--MIO- competitiveness and (b) reconciling water ESCDE). savings in agriculture while addressing pov- It is more difficult to change attitudes than erty and food security issues in the region, implement technical improvements. How- where 40%-60% live in rural areas.rr ever, Egypt's Irrigation Improvement Pro- gramme (IIP), created to improve the With respect to protectionism, it was noted physical and organizational aspects of irri- that given trade liberalization, it may be ar- gated agriculture, is an example where the rogant to require developing countries to combination of technological improvements change their agricultural practices; rather, it and awareness helped the project succeed, as may be wiser to strengthen solidarity be- did trust between local leaders and farmers. tween developed and developing countries, The organizational aspect entailed creating for example, through bodies created to man- WUAs and improving cooperation between age water resources. Further, stakeholders the irrigation directorate and farmers. Sup- and community organizations must partici- ported by physical improvements, farmers' pate in managing the resources and making participation (of both men and women) is decisions to achieve the goals of the Johan- leading to more reliable water services that, nesburg Summit. NGOs, which are close to in turn, are increasing crop production and people, could be vital in the interface be- farmer satisfaction. Also, media campaigns tween the technical and human aspects (H.E. and communication strategies targeted to all Ms Roselyne Bachelot-Narquin, Minister of stakeholders, including women and children, Environment, France). are a first step to changing attitudes (Dr. Asghan Abou Gabal, Communication and With respect to cultivation practices, sus- Rural Development Expert, Egypt). tainable agriculture is based on two pillars: competitiveness of production prices and 4.5.3 Institutional reform; successes and environmental-friendly agriculture, where failures of PPP resources such as soil and water can be pre- The institutional reform session raised the served for future generations. Subsidies may issues of their timing and process, monitor- be necessary for both (Mr. Andres del issuentheizatiomin and pro motng Campo, from the Euro-Mediterranean Fed- ing decentralization measures and promoting eration of Irrigation Associations). stakeholder participation in designing and implementing PPP. If farmers do not shift to modern methods, Institutional reform within an integrated wa- they will not be able to compete. Also, they ter resources management approach is im- *47 Four Pillars in Water Policy Reforms portant, but the process is complex-as it Although private sector involvement is im- includes irrigation, drinking water and vari- portant, public participation is equally im- ous sub-sectors. It requires a strategic ap- portant, and the informal sector has private proach and a plan with clear objectives for sector knowledge that needs to be heeded. the middle and long term (awareness raising, (Dr. Houria Tazi Sadeq, ALMAE) regulations, laws and incentives). For ex- ample, Tunisia designed a national strategy 4.5.4 Non-conventional water resources: that extends until 2030; a chief goal is to Integrating and comparing achieve 30% water savings for consumption alternatives and increase the use of non-conventional water use through institutional reforms. Be- The discussion focused on what can be done cause some countries may not have pro- to promote non-conventional water re- duced long-term water strategies, or have sources within the context of integrated wa- some that are inconsistent, it is vital that ter resources management. they prepare and implement a national strat- egy for institutional reform. (Mr. Abdelaziz Non-conventional water resources need to Liman from SONEDE (National Water Dis- be compared with other alternatives such as tribution Utility), Tunisia) demand management. Although significant progress has been made in techniques and Several risks are attached to PPP. Lessons financing over the past 10 years, such from Asian experiences involve the effec- sources are not the only solution. Rather, a tiveness of subcontracting or users' willing- combination of methods and proper demand ness to pay for services. For example, the management is key to addressing future wa- public's refusal to pay for water may explain ter needs. For example, the Mediterranean why privatization did not succeed in Indone- Commission for Sustainable Development is sia, as opposed to the Philippines-which focusing on the latter course (better man- may be due to different historical attitudes. agement of demand). It was noted that to- Thus, it is important to consider cultural and day's water crisis is similar to the oil crisis historical aspects when implementing pro- in 1973, which caused countries to improve found changes. (Mr. Shozo Matsuura, Man- technical performance and make huge ef- aging Director of Grant Aid Department and forts to become more energy efficient. (Mr. Former Managing Director of Africa & Lucien Chabason, Chairman, Mediterranean Middle East Department, JICA) Action Plan, UNEP). 484 5 REGIONAL ACTIONS SUPPORTING REFORM Various topics were discussed at the closing 5.1 Partnerships for Action session which included the (a) need for re- gional cooperation among countries and do- On the subject of regional cooperation and nors and (b) financing requirements and partnerships, proposals were offered to rein- options to advance such cooperation. De- force them with all stakeholders and donors, spite cultural differences, Mediterranean building on existing regional alliances. countries have a common history and iden- Many organizations and networks are al- tity, which could serve as the basis for ready involved in promoting sustainable wa- stronger partnerships. ter resources at various levels. These include the Mediterranean Action Programme, Bar- The conference reviewed the achievements celona Convention, Euro-Mediterranean of water policy reforms in order to accom- Partnership, Mediterranean Commission for plish the almost impossible task of shifting Sustainable Development, GWP-Med, other from unsustainable to sustainable water regional organizations and various donors, practices and securing prosperity while solv- including the EU, IDB and World Bank. ing poverty problems and environmental degradation. The experiences presented The donor community reaffirmed its support throughout the day indicated that substantial for strengthening regional partnerships. Is- progress has been made. (Mr. Michael sues with respect to donor support were dis- Scoullos, Chairman of GWP-Med) cussed by Mr. Peter Woicke (World Bank) and H.E. Ms. Rodoula Zissi (European Un- ion), and are excerpted below. *49 Regional Actions Supporting Reform Box 4 - World Bank support for regional partnerships Water challenges in the region require urgent action that must include not only new national policies but strong international support--including well-coordinated donor assistance. The Bank is anxious to coordi- nate its work with other international and bilateral organizations and the countries. A regional partnership must bring together regional experts and policymakers, their external supporters, and other (including pri- vate sector) sources of finance and expertise, to develop and expand regional alliances to achieve the goal of "water for growth." The partnerships need to build on existing networks that include the Global Water Partnership Mediterra- nean Technical Advisory Committee (GWP Med-Tec), European Union (EU), International Development Research Institute (IDRC), Islamic Development Bank (IDB), and World Bank's MNA Regional Water Initiative, in close cooperation with governments, bilateral donors, NGOs and the private sector. Techni- cal meetings between country and donor experts are needed to develop practical proposals on prioritized activities and operational mechanisms. The World Bank is ready to support both the lending operations and partnerships. Since 1960, it has committed more than $6 billion for over 100 water, sewerage and irrigation projects in MNA. At present, it is launching a new multi-sectoral approach to water lending through country water resources assistance strategies in consultation with countries and donors in order to assess the multiple issues as well as assist in reforming water policies and building/managing infrastructure. It has also entered into a partnership with AGFUND to provide technical assistance to Gulf countries. Box 5 - EU support for regional partnerships The EU Water Initiative, launched in Johannesburg, introduced the World Summit on Sustainable Devel- opment agreements and action program designed to achieve water-related development goals and promote partnerships. The EU's new Water Framework Directive (2002) adopted an integrated approach, focusing both on qual- ity and quantity. The Directive's goal is for all water in EU countries to achieve "good status" by 2015. In particular, it centers on river basin management and attempts to involve all interested parties. It represents a fundamental shit of EU water legislation, making integrated river basin planning and management com- pulsory for member states, as well as for EU candidate countries. The Mediterranean component of the EU Initiative involves four themes: (a) water supply and sanitation, particularly for the poor; (b) integrated water resources management, emphasizing the management of trans-boundary water bodies; (c) the interaction of water, food and environmental issues, particularly within fragile ecosystems and (d) non-conventional water resources. Linking these components are (a) the transfer of technology, know-how, capacity building and training and (b) education. Partnerships al- ready exist and the funds needed to improve water resources in the region are available. The current design phase of the EU Initiative is attempting to identify building blocks, which may be on- going programs, projects being prepared or implemented, or existing networks and partnerships. The ap- proach requires that the building blocks reinforce each other to achieve specific objectives. Where gaps 5044 Regional Actions Supporting Reform occur, new building blocks will be added. Subsequent implementation will ensure local ownership and leadership of the program. The blocks that have already been designed include two initiatives: the Euro-Mediterranean Water and Poverty Facility, and the Mediterranean Education Initiative for Environ- ment and Sustainability (MEDIES). Both focus on water and waste. Presented by H.E. Ms. Rodoula Zissi, Deputy Minister for Environment, Physical Planning and Public Works, representing the Greek presidency of the EU. Panel members indicated that, rather than 5.2.1 Towards a work program for create new institutional structures, the prior- regional cooperation: ity should be to exchange information and Supporting policy reform strengthen links among regional initia- tives/networks. Also, existing actions In the closing session, the panel and audi- should receive adequate long-term funding ence discussed ways to promote viable re- to ensure continuity. gional cooperation through policy reforms and stressed the need to (a) focus on govern- Participants pointed out the difficulty of ance, (b) address training and capacity promoting partnerships in a region when building so as to strengthen partnerships, (c) many countries are in conflict with each track progress in implementing policies and other. Thus, it is crucial to promote water as (d) ensure that knowledge and experiences means of collaboration and as a vector for are shared across countries. regional cooperation and growth. Policy reform requires a smooth transition 5.2. Supporting Regional Cooperation that can be accomplished through training, through Water Policy Reforms and education and capacity building. Partici- Donor Cooperation pants in all sessions stressed the need for learning and many noted that reinforcing The panel presented several options for existing networks and sharing knowledge moving from words to actions. These in- would promote education and training, and clude: speed the reform process. (a) Securing greater cohesion among exist- In this process, it is important to track how ing regional initiatives to support policy countries are advancing towards sustainable reforms; development: Progress should not be meas- ured only in terms of economic stability but (b) Securing finances for regional actions also by long-term sustainability. In addition and encouraging donors to adopt a uni- to knowledge-sharing and training, the is- fied position. sues of governance and participation in MNA should precede financial reforms. The discussions are summarized below. *51 Regional Actions Supporting Reform 5.2.2 Donor collaboration and new tives, networks and partnerships in the approaches to financing regional Mediterranean Region to avoid duplication cooperation and optimize efforts. Financing is a major issue for which donors will need to better coordinate efforts when Panelists also stressed the need to explore devising strategies for the next 15 years. non-traditional financial instruments, based Innovative ideas will be vital because, while on the findinggs of te Report of the World countries are more informed about institu- Panel on Financing Water Infrastructure, tional solutions and priorities, financial which should be adapted to the MNA re- mechanisms for regional cooperation need gion. to be further explored. Joint efforts, as well as identifying and agreeing on common po- Recommendations from the closing session sitions, are needed to ensure the maximum were included in the Regional Statement, impat o fudingoptonsfromthepriate which was submitted to the 3WWF Secre- impact of funding options from the private tariat on March 21. Dr. Mahmoud Abu-Zeid sector, EU, World Bank and Islamic Bank. con th key Dr. oud Ateid Also, donors must create operational conveyed the key messages of the statement mechanisms that build on existing initia- to the Ministerial Conference on March 22. 5244 l's~~~~~~~~~t es A VNEXES., 1 Annex 1 AGENDA The 3 World Water Forum Middle East and Mediterranean Regional Day March 20, 2003 Takaragaike Prince Hotel, Kyoto, Japan 8:00 - 8:30: Arrival of Participants 8:30- 11:00: OPENING SESSION Water Policy Reforms - Challenges and Achievements Venue: Prince Hall Chairperson: Dr. Ismail Serageldin, Director General, Library of Alexandria and Former Chairman of Global Water Partnership 8:30 - 8:35: Welcoming Remarks by Chairperson 8:35 - 8:45: Introduction of the Day Mr. Salah Darghouth, Sector Manager, Water and Environment, Middle East and North Africa Region, the World Bank 8:45- 9:00: Egyptian Children Performance: A Better Future ror You and Me (Part l) 9:00 - 9:10: Water, Growth, and Socio-Economic Development in the ME/MED Region Mr. Peter L. Woicke, Managing Director, World Bank Group and Executive Vice-President, International Finance Corporation 9:10 - 9:20: Water Policy Reform Challenges and Achievements in Egypt H.E. Dr. Mahmoud A. Abu-Zeid, Minister of Water Resources and Irrigation, Egypt 9:20 - 9:30: Water Policy Reform Challenges and Achievements in Tunisia H.E. Mr. Ameur Horchani, Secretary of State in charge of Water Resources and Fisheries, Minister of Agriculture, the Environment and Water Resources, Tunisia 9:30 - 9:40: Water Policy Reform of the Mediterranean and Linkages with the EU Water Initiative Ms. Rodoula Zissi, Deputy Minister for the Environment, Physical Planning and Public Works, Greece (EU Presidency) 9:40 - 10:30: General Discussion *53 Annexes 10:30 - 11:00: Egyptian Children Performance: A Better Future for You and Nie (Part II) 11:00 - 12:30: Lunch Break 12:30 - 15:15: THEMIATIC SESSIONS Four Key Pillars for Water Policy Reforms THEMATIC SESSION: Groundwater and Shared Aquifer Management V'enue: Room Hiei Chairperson: Rapporteurs: Dr Rawya Kansoh, Water Expert, UN-ESCWA and Mr. Satoru Ueda, Senior Water Resources Specialist, the World Bank 12:30 - 12:45: Introduction of the session: Groundwater Management: Lessons Learned from Sana'a and Barcelona workshops Mr. Satoru Ueda, Senior Water Resources Specialist, the World Bank 12:45 - 13:00: Keynote Address: Overview of Groundwater Management in the ME/MED Region Dr. M. Ramon Llamas, Professor Emeritus, Complutense University, Madrid, Spain 13:00 - 13:15: Lessons from the Global and Regional Experiences Dr Rashid AI-Hmoud, Professor, Texas Tech University, USA 13:15 - 13:30: Country Experiences: Yemen H.E. Mr. Jamal M. Abdo, Chairman, National Water Resources Authority, Yemen 13:30 - 13:45: Country Experiences: Jordan Mr. Edward Qunqar, Director, Ministry of Water and Irrigation, Jordan 13:45 - 14:00: Questions and answers from the audience (coffee available) 14:00 - 14:15: Shared Aquifer Management: Nubian Aquifer Dr. Khaled Abu-Zeid, Senior Water Resources Specialist, CEDARE 14:15 - 14:30: Shared Aquifer Management: North Western Sahara Aquifer 5444 Annexes Mr. Rachid Taibi, General Director, Water Resources National Agency, Algeria 14:30 - 15:10: General Discussion 15:10 - 15:15: Concluding Remarks THEMATIC SESSION: Water, Agricultural Policies and Food Security Venue: Room Takasago Chairpersons: Dr. Ahmed A. Goueli, Secretary-General, Council of the Arab Economic Unity, Egypt and Mr. Juan Canovas Cuenca, Chairman, GWP-MED Advisory Board/Chairman, EMWIS Rapporteurs: Dr. Bayoumi Attia, Adviser, Ministry of Water Resources and Irrigation, Egypt and Ms. Shobha Shetty, Senior Economist, the World Bank 12:30 - 12:35: Introduction of the session: Dr. Ahmed Goueli, Secretary-General, Council of the Arab Economic Unity, Egypt 12:35 - 12:55: Water for Food in MED/ME in 2025 Dr. Mark Rosegrant, Senior Researcher, IFPRI 12:55 - 13:15: Water, Agriculture and Trade Ms. Shobha Shetty, Senior Economist, the World Bank 13:15 - 13:25: Water and Agricultural Productivity Dr Theib Oweis, Senior Irrigation and Water Management Scientist, ICARDA 13:25 - 13:45: Vulnerability and Poverty Mr Ahmed Oulhaj, Advisor to the Minister of Agriculture and Rural Development, Morocco 13:45 - 13:55 Sustainable Use of Water Resources for Agricultural Development in Wetland Areas Mr. Spyros Kouvelis, Coordinator, MedWet-The Mediterranean Wetlands Initiative 13:55 - 15:10: General Discussion 15:10 - 15:15: Closing Remarks *55 Annexes THENIATIC SESSION: Institutional Reforms: Decentralization and Public-Private Partnerships *'enue: Room Suehiro Chairpersons: Dr. Eglal Rached, Regional Director for the Middle East and North Africa, IDRC Rapporteurs: Dr. Elly Baroudy, IDRC and Mr. Ashok Subramanian, Lead Water Institutions Development Specialist 12:30 - 12:40: Introduction of the Session and Overview of the Water Demand Management Forum in MENA Dr. Elly Baroudy, IDRC 12:40 - 13:00: Keynote Address: Efficient Integrated Water Management Requires Institutional Reform Mr. Abdelkader Hamdane, Director of Rural Development and Engineering, Ministry ofAgriculture, the Environment and Water Resources, Tunisia Decentralization 13:00 - 13:15: Comparative Experiences in Decentralization and Participatory Irrigation Management in MENA - Lessons Learned Mr. Qahtan Abdul-Malik, Director, Central Unitfor Irrigation and Water Monitoring, Ministry ofAgriculture and Irrigation, Yemen 13:15 - 13:30: Overview of Decentralization in Asian Countries and links with ME/MED Experiences and Future Strategies Dr. Tsugihiro Watanabe, Research Institute for Humanity and Nature, Ministry of Education, Culture, Sports, Science and Technology, Japan 13:30 - 13:45: The Dialogue on Effective Water Governance in the Mediterranean Mr. Vangelis Constantianos, Executive Secretary, GWP-Med Public Private Partnerships 13:45 - 14:00 Private Sector Participation in Water Resources Management in Morocco Mr. Mokhtar Bzioui, Director of Research and Water Planning, Ministry of Land Use Planning, Water and Environment, Morocco 14:00 - 14:15: Private Sector Participation in Water Resources Management in Jordan Eng. Mohammed Najjar, Ministry of Water and Irrigation, Jordan 14:15 - 14:30: Mobilizing Financial Resources and Attracting Investment/Public-Private Partnerships Mr. Mohammed Benblidia, President, Mediterranean Water Institute (IME) 14:30- 15:10: General Discussion 15:10 - 15:15: Closing Remarks 564 Annexes THEMtATIC SESSION: Non-Conventional Water Resources Venue: Prince Hall Chairperson: H.E. Dr. Abdelmajid Attar, Minister of Water Resources, Algeria Rapporteurs: Dr. Karim Allaoui, Focal Point for Water Resources Management, Islamic Development Bank and Mr. Manuel Schiffler, Senior Economist, the World Bank 12:30 - 12:40: Opening Address H.E. Dr. Abdelmajid Attar, Minister of Water Resources, Algeria 12:40 - 12:50: Opening Address Dr. Amadou B. Cisse, Vice President (Operations), Islamic Development Bank 12:50 - 13:05: Trends in Desalination in the ME/MED Region Dr Adil Bushnak, Bushnak Group, Saudi Arabia 13:05 - 13:20: Innovative Use of Non-Conventional Water Resources in Cyprus Dr. Chrysostomos Kambanellas, Ministry of Agriculture, Natural Resources and Environment, Cyprus 13:20 - 13:30: Questions and answers from the audience on Desalination 13:30 - 13:50: Wastewater Reuse in ME/MED Region Dr. Akissa Bahri, National Research Institute for Agricultural Engineering, Water and Forestry, Tunisia 13:50 - 14:00: Questions and answers from the audience on Wastewater Reuse 14:00 - 14:20: Irrigation with Saline Water for Sustainable Agricultural Production Dr. Donald Suarez, Director of US George Brown Salinity Laboratory, University of California, Riverside, USA 14:20 - 14:35: Biosaline Agriculture: An Approach to Utilization of Brackish Water Dr. Kawser Malik, Director General of Biological Sciences, Pakistan Atomic Energy Commission, Pakistan 14:35 - 14:50: Questions and answers from the audience on Saline Water Use _+57 Annexes 14:50 - 15:10: General discussions focusing on common aspects of non-conventional water resources in the context of integrated water resources management 15:10 - 15:15: Concluding Remarks 15:15 - 15:45: Coffee Break 15:45- 18:00: CLOSING SESSION The Way Forward and Recommendations for Action Venue: Prince Hall Chairpersons: Dr. Ismail Serageldin, Director General, Library of Alexandria and Former Chairman of Global Water Partnership and Prof Michael Scoullos, Chairman MIO-ECSDE and Chairman GWP-Med 15:45 - 16:00 Introduction of the Panel 16:00 - 17:45: Panel and General Discussion 17:45 - 18:00: Concluding Remarks 584 Annexes Annex 2 Middle East and Mediterranean Regional Day, March 20, 2003 Takaragaike Prince Hotel, Kyoto, Japan Closing Session -Water Panel 15:45 - 18:00 What is the objective of the Panel? The objective of the Water Panel is to broaden the debate of the Regional Day in an effort to incorporate the perspectives of a wide range of stakeholders from the region. The focus of the discussion will be on water sector reforms: strategies for action and recommendations at the regional level. Panelists are not expected to make any presentation or statement on their respective country or sector of interest. Rather, they are invited to answer any question raised by the moderators of the session based on observations from the audience. What is expectedfrom the Panelists? Based on their views of the Regional Statement and their participation in the opening and thematic sessions, the Panelists are invited to discuss actions to implement their visions for water sector reforms in the region. More specifically, Panelists are invited to propose actionable recommendations at a regional level through the broad framework of integrated water resources management. What is the expected output of the Panel discussions? The Panel discussions will provide ideas and inputs for the call for action; enhance the dialogue between stakeholders and Ministers scheduled at the Forum; and contribute to the design of a future Middle East and Mediterranean Regional Water Partnership in close collaboration with countries and partners. List of Panelists: (1) H.E. Dr. B. Aminipouri, Deputy Minister for Soil and Water Directorate, Ministry of Jihad-e - Agriculture Iran H.E. Dr. Abdelmajid Attar, Minister of Water, Algeria (2) S.E. Mme Roselyne Bachelot - Narquin, Minister for Environment and Sustainable Development, France H.E. Mr. Altero Matteoli, Minister for the Environment, Italy Mr. Redaud, Plan Blue, UNEP (3) Prof. Youssed Nouri, Co-Chairman, Mediterranean Information Office for Environment, Culture and Sustainable Development (MIO-ECSDE) (4) Ms. Houria Tazi Sadeq, President, ALMAE, Morocco and UNESCO (5) Dr. Ashgan Abou Gabal, Communication and Rural Development Expert, Egypt Mr. Andres del Campo, Chairman, Euro-Mediterranean Irrigation Communities Network Mr. Abdelaziz Limam, SONEDE, Tunisia (6) Representative from JICA (7) Dr. Eglal Rached, Regional Director for Middle East and North Africa, IDRC * 59 Annexes Annex 3 Statement of Middle East and Mediterranean Regional Day From Scarcity through Reform to Security 1. Key Issues. Water resource management issues in the Middle East and Mediterranean Region are among the most critical of any region in the world. Annual per capita water availability for the Southern Mediterranean region has fallen from about 3,400 m3 in 1960 to an average of about 1,200 m3 today. It is projected to fall to just over 500 m3 in 2025 due to high population growth rate and increased urban and rural water use. In many parts of the region, dwindling water resources are threatening people's livelihood, the environment, and economic growth. Intermittent supply is common in many cities and agricultural water supply faces the challenge of competing demands for water. 2. Strategies for Actions. Moving from water scarcity to water security in the region is achievable only through major reforms in the management of water resources. Some countries have made significant progress with reforms to meet their water challenges and to achieve the Millennium Development Goals, while others are at early stages of the reform agenda. Water reform entails establishment of a policy and institutional framework, including integrated water resources management programs to adequately address depleting water resources, increasing competition for water, and problems of water quality. Efficient and effective water use is critical for success. Furthermore, water reform requires capacity building/enhancement and empowerment of the public and private sectors as well as community organizations to realize and fulfill their roles. Governments in the region will act upon their primary responsibility in creating the enabling policy, economic, social and environmental conditions for sustainable, efficient and equitable water management. They will promote a reform agenda that should at least contain the following four key strategic actions: (i) Adopting an integrated water resources management framework for planning and management of water resources in the country; (ii) Promoting efficient use of water through technical instruments and economic incentives, including appropriate pricing and cost recovery mechanisms; (iii) Mobilizing stakeholders to advance participatory and decentralized approaches and public-private-partnership; and (iv) Promoting regional and international partnerships to foster technical and financial cooperation on water issues. (See Annex for a more detailed description.) 3. Recommendation. There is a need to support the countries' reform agenda, which calls for concerted and sustained effort among governments, stakeholders, local communities, and partner organizations. It is recommended that partnership activities be strengthened among the countries of the Region (i) to deepen the understanding of common water challenges, (ii) to enhance knowledge and information sharing between the countries and the partners, and (iii) to provide systematic support for strategy formulation and capacity building for governments, institutions, and civil society organizations. Recommendations of the Report of the World Panel on Financing Water Infrastructure are noted and will be adapted to the regional situation. 60 4 Annexes Key Strategic Actions for Reform in the Water Sector Institutional reform is a central requirement for comprehensive water planning and management yet is one of the most difficult measures to implement. A reform strategy must be flexible and tailored to the requirements of individual countries and basins. Certain key actions are essential to the reform process in the water sector in the Middle East and Mediterranean Region as follows: 1. Adopting integrated water resources management as the key process utilized in addressing the water challenges Integrated water resources management is a framework for coordinating sectoral needs, water and water-related policy, resource allocation, and management within the context of social, economic, and environmental development objectives. It provides a systematic process for linking water and water-related policies, objectives, and water uses to the design and implementation of programs, improvement of decision-making, and management of natural resources. Governments in the region would be well served by adopting an integrated approach to water resources management because: a) it is globally accepted and makes good sense; b) it assesses all sources, including non-conventional ones, and uses of water in a comprehensive manner from both water quantity and water quality aspects; c) it incorporates social and environmental considerations directly into policy and decision making; d) it directly involves the stakeholders; and e) it is a tool for optimizing financing and investments under tight financing climate. 2. Using water more efficiently for most value and benefit through technical instruments and economic incentives Given demographic pressure on limited resource and financial and technical constraints on new supplies, greater emphasis should be put on demand management, covering both direct measures to control water use through regulation and technology and indirect measures that affect voluntary user behavior. This may be achieved through market mechanisms, economic t financial incentives, and public education. Resource pricing progressively brought closer to real economic levels through application of financial instruments and incentives. Also, technical interventions are important in all sectors to reduce unaccounted-for water and losses and maximize use of non-conventional sources. Modernization of both conveyance and distribution systems and use of non-conventional sources have particular potential. 061 Annexes 3. Mobilizing stakeholders to promote participatory and decentralized approaches and facilitating Public-Private Partnership Water management consists of: (i) management of the resource itself and (ii) delivery of water services. Management of the resource includes policy, legal/regulatory framework, allocation, and environmental aspects. National policy formulation is inherently a centralized government function, but many other aspects of water management may be delegated to the regional, basin, or local institutions/organizations. Decentralization and stakeholder participation in decision-making not only promote accountability and transparency but also create strong ownership of and commitment to the management of water resources. Delivery of water services generally involves wholesaling of water to intermediaries and retail distribution to end users - households in a municipality, farmers in an irrigation scheme, etc. Services delivery can be by public, private, or through a public/private partnership. An increased role of the private sector, where appropriate, should be pursued for supplying cost-effective and quality service under an effective regulatory framework in the urban as well as in the rural sectors. 4. Promoting regional and international partnerships to foster technical and financial cooperation on water issues Designing water policies and financing their implementation in line with country-specific circumstances and priorities, is the primary responsibility of national governments. The international community must play its part in this effort to enhance development assistance and to coordinate better their support programs. Given the complexity of the policy and institutional reform process, knowledge generation and sharing, as well as information / data sharing on good practices, systems, and technological development are essential, strengthening of partnership and networking activities in the Middle East, North Africa, and the Mediterranean region among the countries, as well as with partner organizations is critical to the success of the strategic actions outlined here. Recommendations of the Report of the World Panel on Financing Water Infrastructure are noted and will be adapted to the regional situation. 6244