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Caribbean experts urge greater investment in water sector

HEYWOODS, Barbados – Senior policy-makers, international experts and representatives of the private sector urged better conservation and innovative financial approaches to meet growing needs in the Caribbean for water and sanitation services in a sustainable fashion. They proposed an integrated approach to meet the demands of economic growth and the vital tourist industry.

Barbados Prime Minister Owen Arthur, inaugurating the conference at the Almond Beach Village in Heywoods, St. Peter, said there is “no greater constraint” to the future development of his country and other nations of the Caribbean, many suffering from water scarcity, than the expense and complexity of resolving the growing demand for water and sanitation services. He said there “is a tendency to understate” the extent of an impending world water and water-related crisis, which will need major new investments and institutional modernization to overcome.

The conference was organized by the Inter-American Development Bank to explore ways to achieve greater efficiency and lower costs through reform and innovation to meet demand to provide water and sanitation services while water resources become ever more scarce.

Conference speakers noted that although the Caribbean ranked well in world standards in available drinking water, it nevertheless faces deficiencies in sanitation services and challenges in containing pollution and maintaining tourist sites attractive. They noted the region ranks poorly compared to developed countries in terms of staff productivity in the water sector and water leakage.

Several experts outlined the challenge to the region of meeting United Nations millennium development goal of reducing by half the population without access to sustainable water and sanitation services by the year 2015 compared with the year 1990.

IDB Executive Vice President Dennis Flannery noted the Caribbean, in order to meet the millennium goal, will need to invest a projected $560 million over the next 12 years to provide about an additional 1 million people with water and sanitation services.

“This need presents a special challenge at a time when most governments face difficult fiscal constraints,” he said.

He suggested steps to build a “social consensus” to support reforms that would make present water and sanitation systems both more sustainable and equitable – including the application of fair and equitable pricing systems – and innovative financial structure in which risks would be shared by government and the private sector.

Flannery noted that multilateral development banks, such as the IDB, were ready to help the reform and innovation process through loans and technical assistance.

The conference featured four different panels composed of Caribbean experts and senior officials in the water and sanitation sector that addressed “Water Resources in the Caribbean – Developments and Challenges;” “Financing Water and Sanitation: the Alternatives;” “Institutions and Water: What has been done, what is lacking?” and “The Tourism and Water Sanitation.”

Speakers noted that despite much progress in the water and sanitation sector, the Caribbean still suffers from “nonrevenue water,” meaning water consumed through illegal connections or leakage that in some cases produces losses of up to 50 percent of the water system. They noted the need for additional studies and data on supply and demand and on the availability of resources as well as for major new investments and the application of new technologies.

In the financial area, panelists stressed the need for pricing policies that result in a sustainable level of investment and supply with equity and suggested the need for innovative financial mechanisms and partnerships between the private and public sector. They noted the need for institutional strengthening and modernization of the management and regulatory framework of public water and sanitation systems.

Panelests recommended an integrated approach toward meeting the challenges of providing adequate water and sanitation systems that will take into account the type of water supply needed for agriculture, industry and tourism as well as for drinking. An integrated approach, the experts said, could address several needs and issues, such as sustainability and accountability of the systems, environmental protection and policy challenges.

Speakers noted the special importance of building and maintaining reliable water and sanitation systems in the Caribbean because of the dominance of the tourist industry, which accounts for as much as 40 percent of the gross domestic product in some countries. Pollution control and water supply are critical elements in maintaining a viable tourism sector.

While water is considered a “right,” subsidy systems tend to be distorted, favoring better-off consumers rather than the poor and placing unfair burdens on taxpayers. There was a consensus among panelists that policies need to be put in place that make the water sector financially sustainable while insuring access to potable water for all, including the poorer sectors of the population.

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