Presentation - Seventh Roundtable on Financing Agricultural Water - Marwan Ladki, PhD, Principal Irrigation Engineer, Agriculture & Agro-Industry Department, African Development Bank

1. 7th meeting of the FAO-OECD Roundtable on
Financing Agricultural Water:
Sustainable Use of Water for Agriculture
Wednesday, 27th January, 2021
Dr. Marwan LADKI
Principal Irrigation Engineer
Agriculture & Agro-Industry Department (AHAI)
M.Ladki@afdb.org

2. Past
Engagement in AWM financing
AfDB financing in irrigation & drainage since 1971

3. Considering investment operations specifically labelled as “I&D”: Circa 1 billion USD approved through 71 operations
• Mostly African Development Fund (ADF) grants and/or concessional loans, representing circa:
 54% of financial instruments mobilized
 460 M.USD in total
 9 M.USD in average per ADF instrument (grant or loan)
• Sometimes blended with African Development Bank (ADB) non-concessional loans:
 10% of financial instruments mobilized
 410 M.USD in total → ADB funding equivalent in volume to ADF funding
 35 M.USD in average per ADB loan → ADB funding: Budget per project much higher than ADF
• African Water Facility (AWF) also active in financing I&D, for smaller amounts:
 8% of financial instruments mobilized
 13 M.USD in total
 1.6 M.USD in average per AWF grant → AWF grants much smaller, focusing on soft
• Various Trust Funds and special initiatives (e.g. MDRI, MIC, NTF), representing circa:
 25% of financial instruments mobilized
 6.5 M.USD in average and 155 M.USD in total → Substantial contribution of TFs and SIs to I&D financing
Much greater investments when considering “Agriculture & Rural Development”-labelled operations incl. I&D component

4. Current
Engagement in AWM financing
AfDB active portfolio in irrigation & drainage

5. • 6 investment operations labelled as ”Irrigation & Drainage” per se:
- Mainly North Africa: Egypt, Morocco (stronger focus on I&D specifically)
- Total of circa 225 M.USD on active portfolio for I&D solely, compared to 1 B.USD over 1971-2020:
 Greater investments compared to previous decades, through ADB Loans mainly (90% in volume)
 Stronger focus on drainage, renewable energy for pumping, water savings and smallholder farming
• 21 investment operations labelled as “Agriculture & Rural Development” and including I&D component:
- Total of 12,65 Billion USD (54 M.USD per project on average) but for ARD as a whole
 Greater integration of I&D investments into Value Chain projects (past & current trends)
- Mainly through multinational operations (57% of operations), especially:
 Sahel: 220 M.USD over 7 national and 1 regional projects (P1-P2RS)
 Horn of Africa: 150 M.USD over 5 national projects (DRSLP- 2 and 3)
 Greater integration of I&D investments into Food Security and Resilience projects (idem)
 Greater consideration of regional approaches (integration and coordination)
- Very substantial investments on I&D by Burkina Faso: 130 M.USD, incl. through ADB loan
 Mostly through collective irrigation (10 ha to 2,000 ha) and rainfed. Youth and gender focus +
 Need to emphasis small-scale private irrigation / economic and social returns (value for money)

6. Upcoming
Engagement in AWM financing
2021-2023 Lending Programme on irrigation & drainage

7. • 9 investment operations labelled as ”Irrigation & Drainage” per se
- +480 M.USD in total
- 70 M.USD on average per project
 Budgets keep increasing
 Interest of North African countries keep increasing
 Greater focus on Water Recycling, Energy, Water Productivity and Water Savings
• ARD-labelled investment operations incl. I&D component
- Greater emphasis on multinational operations:
 Sahel: 320 M.USD over 13 countries and 1 regional projects (P2-P2RS)
 Horn of Africa
 Greater integration of I&D investments into Value Chain, Food Security, Land degradation
neutrality and Climate Change Adaptation & Mitigation projects (current & future trends)
 Mobilizing climate finance, supporting the Climate Investment Plan for the Sahel (2018-2030),
operationalizing of the Climate Commission for the Sahel Region (CCRS), etc.

8. New
AfDB Policy and Strategy on Water
The AfDB Water Policy 2020
The AfDB Water Strategy 2021 – 2025
Towards a Water Secure Africa
To be adopted in 2021 (coming weeks)

9.  Attainment of water security at household, national and regional levels should be recognised as a key
outcome fundamental for inclusive growth
 Equitable social welfare and economic growth require the application of the IWRM approach
 Promoting sustainable and equitable access to water services is an enabler for the SDGs
 Transboundary water resources management and development should be recognised as a significant
requirement to achieve regional economic integration
Serves AfDB’s ‘High 5s’ (priority areas of intervention) :
1. Light Up and Power Africa
2. Feed Africa
3. Integrate Africa
4. Industrialize Africa
5. Improve the quality of life for the people of Africa
4 principles grounding AfDB’s Water Policy

10. 7 operational guidance to AfDB’s operations in the water sector
1) Economic valuation of water resources, pricing of water services and cost recovery
2) Sustainable, smarter and more resilient infrastructure
3) Governance and enabling environment
4) Financing and investments
5) The multi-purpose use of water and ecosystems approach
6) Knowledge management, innovation, technology and research
7) Participation and inclusiveness

11. 4 pillars of the new AfDB Strategy on Water
 Pillar 1 – IWRM: Achieve integrated and sustainable water resources management, through
assessment of resources and ecosystems; supporting institutions and broader enabling environment
 Pillar 2 – Inclusive, Sustainable and Climate Resilient Water Services: Strengthen the delivery of
water services to become sustainable, resilient, and inclusive, through increased investments,
institutional support, and sustainability in both urban and rural areas
 Pillar 3 – Water for Food: Increase the availability of sustainable water resources for food
production and improved nutrition, including improved agricultural water management and
investments which sustain fisheries and support ecosystems
 Pillar 4 – Water for Energy: Increase the sustainable development of water for energy in terms of
hydropower potential, thus complementing the New Deal for Africa Strategy and acknowledging the
importance of energy for water security

12. Major orientations for AWM from the new Water Policy
 Finance and support sustainable and climate-smart agriculture and agri-business operations that promote the
optimum use of water for agriculture
 Promote the IWRM principles, addressing both the supply and demand sides of water resources management
including water conservation, reuse, recycling, and reallocation
 Continue to support efficient and climate-smart irrigation strategies and programmes
 Promote the use of non-conventional water resources, including recycling agricultural runoff, treated wastewater re-
use and storage, desalination using renewable energy, inter-basin transfer, rainwater harvesting, grey water-use
 Promote smarter, greener and more crop production that minimize water and fertiliser consumption
 Promote youth employment, especially in the irrigation sector
 Promote innovative financing, such as agribusiness PPPs, to improve water security for agriculture
 Assist projects that build human capacity as well as develop institutional structures in the food and beverage
industry, such as water abstractor groups and extension support services
 Create an environment conducive for increased climate-smart agricultural water investment

13. Lessons learnt from the
AWM and Irrigation sector
Beyond Infrastructure
Development:
Toward Service Delivery and
Behavioral Change

14. Improving Quality of Design
Lack of clear theory of
change for water strategic
documents and
interventions
1 2
Participatory Approach
2
Feasibility Studies
&Technologies
Choice
3 Risks Assessment
4
Fostering Development Impact
Holistic Approach
5 Utilities Performance
6 Cost recovery
7
Water Services
Delivery
8
Moreover…
Market infrastructure
in Small-Scale
Irrigation Development
Irrigated farming
and child
nutrition
9 10 Knowledge
Management
11 Results Monitoring
and Evaluation
12

15. Thank you for your attention
Wednesday, 27th January, 2021
Dr. Marwan LADKI
Principal Irrigation Engineer
Agriculture & Agro-Industry Department (AHAI)
M.Ladki@afdb.org