The document discusses the Asian Infrastructure Investment Bank's (AIIB) draft water strategy. It outlines that AIIB has approved $1.42 billion for 7 water projects across 6 countries since opening in 2016. The draft strategy aims to articulate AIIB's role in helping members address water challenges, provide principles for investment selection and prioritization, and establish guidance for capacity development and business. The strategy vision is to contribute to ensuring availability and sustainable management of water and sanitation for all. It proposes AIIB initially focus on investment-ready projects and explore partnerships, then gradually take on more complex projects and contribute to policy dialogues.

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Draft AIIB Water
Strategy
David Ginting, Investment Operations Specialist – Water,
Asian Infrastructure Investment Bank, david.ginting@aiib.org

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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);
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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)

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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);
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AIIB Draft Water Strategy

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Vision: contributing to global agenda of ensuring the availability and
sustainable management of water and sanitation for all (SDG-6)
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• 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

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AIIB categorization of investment areas underpins its
vision and principles
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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

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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
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- 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
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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

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Thank You
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policies/public-consultation-draft-water-sector-strategy/index.html