The European Investment Bank, the world’s largest multilateral bank, and the Dutch government are joining forces in support of the water and sanitation sector. Dutch Foreign Trade and Development Cooperation Minister Lilianne Ploumen and EIB Vice-President Pim van Ballekom, have signed a Memorandum of Understanding (MoU) on the margins of the Third International Conference on Financing for Development in Addis Ababa (Ethiopia) today.
This will create a framework for future cooperation between the EIB and the Dutch authorities to leverage knowledge, capacity and additional financing in support of more and better investment projects in the water and sanitation sector. The main geographical focus of the collaboration would be developing countries, with a special focus on Africa, although it may extend to EU countries or neighbouring states as well.
Pim van Ballekom, Vice-President of the EIB, commented: “This new partnership will strengthen support for water investment in our partner countries. Combining our lending with Dutch grants and knowledge allows us to do things better, to explore innovative financing structures and to leverage much-needed investments from the public and private sector. This signing is a great step in supporting concrete projects that make real impact on the ground.”
Much of the importance of the document lies in the direct effects that this type of cooperation can have on a local level, as was demonstrated recently in Malawi. Here, the EIB’s financing leveraged initiatives of the national government, a local water board, a leading Dutch water company and a local NGO, which financed a project run by the local population to provide clean water for more than 750,000 people.
Minister Ploumen added: “It’s a very positive development that the EIB, as the world’s biggest multilateral bank, is committing itself to the UN’s new sustainable development goals (SDGs), in this case by making available loans for investments outside Europe in the field of water and sanitation. We look forward to working together with the EIB on this.”
Within the scope of the new agreement, the Dutch government has confirmed its intention to provide EUR 2 million in support of the Bank’s activities in the water and sanitation sector. Discussions are also underway with other potential bilateral contributors with the view of pooling resources to achieve critical mass and economies of scale. The partnership can help to improve project design and implementation, while offering sustainable financial solutions to critical investments.
Last year the European Investment Bank provided more than EUR 2.5 billion for long-term investment in energy, water, transport and education projects, as well as supporting private sector investment, in Africa.