Ten multilateral development banks (MDBs) active in the water sector have approved global investments totalling $19.6 billion (€17 billion) in 2024. According to the inaugural Joint Annual MDB Water Security Financing Report, launched on the sidelines of the 4th International Conference on Financing for Development in Seville, nearly three-quarters of these funds were earmarked for low-, lower-middle-, and upper-middle-income countries.
The report follows a joint commitment made in December 2024 at the One Water Summit in Riyadh, Saudi Arabia, by the African Development Bank Group, Asian Development Bank, Asian Infrastructure Investment Bank, European Bank for Reconstruction and Development, European Investment Bank, Inter-American Development Bank Group, Islamic Development Bank, New Development Bank, and World Bank Group. The MDBs pledged to significantly increase support for the water sector between 2025 and 2030 and to report jointly on their progress.
This first edition of the annual Water Security Financing Report provides an overview of MDB investments in the global water sector, establishing a baseline for tracking future financing. It highlights the collective efforts of the ten members of the MDB Water Sector Coordination Group (the aforementioned banks plus the Council of Europe Development Bank) to foster collaboration, share expertise, and drive innovative solutions. It also shows that the EIB accounted for more than a quarter of total MDB financing to the sector in 2024. This strong engagement is in line with the EIB’s forthcoming Water Resilience Programme, which aims to increase the Group’s lending in the sector by 50% to €15 billion between 2025 and 2027, potentially catalysing up to €40 billion in global water investments over three years.
“Creating sustainable water systems worldwide requires financing, but it also demands partnerships that bring together investment, technical assistance, and knowledge,” said EIB Vice-President Ambroise Fayolle. “That is why the MDBs have made water a shared priority. The first Water Security Financing Report reflects our collective responsibility – and our ambition to achieve more, together.”
Examples of EIB cooperation with other MDBs include a partnership with the African Development Bank, Islamic Development Bank, World Bank Group, and West African Development Bank to help protect Cotonou, Benin, from flooding by improving drainage infrastructure across 34 basins. In Mongolia, the EIB and the Asian Development Bank are working together to build wastewater treatment plants and improve rainwater drainage systems in several cities. The EIB has also enjoyed a 20-year collaboration with the Council of Europe Development Bank, co-financing the construction, expansion, and refurbishment of water and sewerage networks in all major municipalities across Cyprus.
Background
Half of the world’s population is estimated to live in areas facing water scarcity. Climate change is altering rainfall patterns and increasing the frequency of extreme weather events, threatening both the quantity and quality of water resources and damaging vital infrastructure. At the same time, cooperation to optimise water resource management and development is lacking, and fragmentation hampers water security. According to a World Bank study, the annual funding gap to achieve universal access to safe and affordable drinking water and sanitation is estimated at $138 billion (a mid-range estimate) between 2017 and 2030. On average, countries would need to nearly triple their annual spending to close this gap. The challenge is even greater in Sub-Saharan Africa, where spending would need to increase by up to 17 times, and in low-income or conflict-affected countries, where investment may need to rise by as much as 42 times.