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Presentation - Fifth Roundtable on Financing Water - Mr. David Ginting


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Presentation: Draft AIIB Water Strategy - Fifth Roundtable on Financing Water - Mr. David Ginting

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Presentation - Fifth Roundtable on Financing Water - Mr. David Ginting

  1. 1. *OFFICIAL USE ONLY Draft AIIB Water Strategy David Ginting, Investment Operations Specialist – Water, Asian Infrastructure Investment Bank,
  2. 2. *OFFICIAL USE ONLY Overview of AIIB Water Investments • AIIB opened for business in January 2016 and positioned ‘Water’ as one if its core sectors (together with Energy, Transport, Urban and Digital Infrastructure); 2 59%17% 15% 9% BY SUB-SECTOR WATER SUPPLY AND SANITATION IRRIGATION FLOOD MANAGEMENT WATER RESOURCES MANAGEMENT 41% 38% 21% BY REGION SOUTHEAST ASIA SOUTH ASIA MIDDLE EAST • First water project approved in Mar 2017 • Per Oct 31, 2019, AIIB has approved seven projects in six countries • Total = USD 1.42 billion (14% of total financing)
  3. 3. *OFFICIAL USE ONLY AIIB and the Asian water sector • Pipeline per Oct 31, 2019 = USD 1.62 billion; expanded operation to the Central Asia • Growing operations call for an investment strategy aimed to: 1. articulate the role to play in helping members address water challenges 2. provide key principles for the selection and prioritization of investments; and 3. establish guidance for developing capacity and business; • Strategy’s development was launched on April 2019 through a workshop in Beijing, followed by a technical analysis on the Asian water sector; • First draft has been disclosed for public consultation from mid Oct 2019 (AIIB Website); 3
  4. 4. *OFFICIAL USE ONLY 4 AIIB Draft Water Strategy
  5. 5. *OFFICIAL USE ONLY Vision: contributing to global agenda of ensuring the availability and sustainable management of water and sanitation for all (SDG-6) 5 • Positive impact on sustainability and maximize environmental and social outcomes in line with SDG6 • Client-driven and integration of projects in to their development plan • Focus on financial sustainability of assets and operations Promote sustainable infrastructure • Holistic approach by promoting integrated water resource management • Investments are carried out in a manner that helps build connection, coordination and collaboration amongst stakeholders Integrated resource management • Addressing the financing gap, in sector dominated by public financing • Harnessing of private sector innovation, management and optimization efficiencies together with increasing the flow of private funds Mobilizing private capital & efficiencies • Use of technology to improve efficiencies in management, governance and service delivery – reduce cost and strengthen resilience • Important catalytic role to promote adoption and dissemination of technology Adoption of technology
  6. 6. *OFFICIAL USE ONLY AIIB categorization of investment areas underpins its vision and principles 6 AIIB’s investment areas in the water sector Water Services • Improved efficiency of water services (water supply and sanitation, irrigation and drainage); • Better access to quality water • Expand access to water services • Harness water’s productive potential in energy and transport • Rehabilitation, upgrading and improved safety of existing water infrastructure Resource Management • Improve water quality • Reduce water pollution, • Enhance efficiency of water use and allocation • Water reuse and recycle • Integrate nature-based solutions • River and lake restoration • Augment water supplies and storage • Water conservation Resilience • Reduce losses from floods, droughts, freshwater variability and other related disasters through physical interventions • Institutional and system improvements (including better hydrological monitoring, disaster warning & contingency planning) Private Sector Mobilization & Adoption of Technology
  7. 7. *OFFICIAL USE ONLY Approach (1) • Not feasible at this stage to limit range of financing activities- need to be responsive to Member needs and requests while being realistic about Bank’s capabilities; • The Bank limits its activities based on (1) Bank’s capacity, (2) project implementation readiness and (3) degree of institutional reform needed; • Financing of innovative technology is a cross cutting measure, to be implemented with Digital Infrastructure Strategies and Sustainable Cities Strategy 7
  8. 8. *OFFICIAL USE ONLY - Focused on investment-ready projects with well-demonstrated institutional and implementation capacity of client; - Co-financing where institutional reform needs are greater; - Example of investments: upgrade, expansion, rehabilitation of existing infrastructure with track record of successful operations - Explore and deepen partnerships (through co-financing and knowledge partnership) to address policy and regulatory challenges in projects; and to build bank’s capacity and establish its position in policy dialogues; - Build reputation and business by strengthening in-house capacity and active client and partner relationship - Gradually undertake more complex projects (technical, financial and institutional) and actively contribute to policy dialogues and institutional reforms; to gain favorable position in shaping the envisaged financing; - Position itself as a catalyst for private financing and adoption of innovations in technologies and green solutions. Approach (2): evolution of engagement in the sector 8 Partnership building Standalone, co-financing, private capital mobilization Financing Standalone and Co-financing Support Policy Dialogue Support policy dialogues to influence project inception Standalone, co-financing, private capital mobilization Short-term Long-term Degreeofinstitutional complexity Medium-term
  9. 9. *OFFICIAL USE ONLY 9 Thank You Share your feedback via: policies/public-consultation-draft-water-sector-strategy/index.html