8 November 2016

A high-level breakfast meeting and guest lecture event offered ample opportunity to discuss the issues of governance when investing in water projects.

The Sustainable Business Initiative (SBI) and University of Edinburgh International Office in collaboration with Shepherd and Wedderburn were delighted to host the second Scottish Business in Africa Forum (SBIAF) in October 2016.

Inspired by the Royal African Society (RAS) format of a high-level breakfast meeting followed by an evening guest lecture event, the SBIAF were honoured to host two distinguished guests for the day – Anton Earle, Director of the African Regional Centre, Stockholm International Water Institute (SIWI) and Prince Mleta, Deputy Director of Water Resources for the Ministry of Agriculture, Irrigation, and Water Development, Government of Malawi.

Invitation-only breakfast meeting

The breakfast meeting was held at the University of Edinburgh’s grand Old College. High level delegates represented Scotland’s private, government and third sector water industry. The meeting’s chair, Dr Ola Uduku, the UoE Dean for Africa provided introductions. Opening remarks were then delivered by both Professor Kenneth Amaeshi, Director of the Sustainable Business Initiative and Stephen Gibbs, Chief Executive of Shepherd and Wedderburn.

Mr Earle and Mr Mleta went on to deliver impressive perspectives and insights during their short presentations. These focussed on the different approaches to governance and ways in which investment could be structured through public and private channels. They also explored how investment could be introduced at an earlier stage and the new focus on commitment to SDG 6: Ensure availability and sustainable management of water and sanitation for all.

As the leader of the Scottish Government’s Water Industry Team, John Rathglen, provided a brief policy perspective touching on aspects such as sponsorship of the public corporation Scottish Water and the new Hydro Nation agenda. He was able to draw on aspects of Scotland’s approach going forward and intentions for the future.

Attendees then asked challenging and diverse questions for the presenters that stimulated great conversation and allowed for knowledge sharing. It was a pleasure to host such a dynamic and engaged group.

SBIAF Water event participants

Evening guest lecture

The breakfast conversations laid the foundations for the evening guest lectures. Introductions were provided by Aidan Hetherington, Corporate Engagement Manager from UoE Business School and Professor Kenneth Amaeshi.

Fiona Parker of Shepherd and Wedderburn

Opening remarks were delivered by Fiona Parker, Senior Associate, Shepherd and Wedderburn. She gave an overview of the firm, elaborated on the work they are currently doing in the area and provided insights into water investments. She reminded delegates that: “no matter how water and sewerage services are financed, they are all publicly funded”. After briefly touching on economic regulation, Scottish experience and regulatory frameworks, Parker set the scene for the evening’s proceedings and handed over to the guest speakers.

First up Anton Earle gave an overview of the Stockholm International Water Institute (SIWI) and their current work in Africa. Given their extensive portfolio of innovative operations on the continent, it is clear why this was the logical and ideal location for SIWI’s first international office. The key points to take away from the presentation included:

  • Economic and Demographic Shifts: Population and economic growth has resulted in diversification and urbanisation. This has heavily impacted Africa in particular with as many as 70% of the world’s fastest-growing countries based on the continent. Naturally, this has implications for the supply and sustainability of water resources.
  • Challenges and Opportunities: With growing strain on a finite resource, it is necessary to adequately manage these both from an environmental and political perspective. Africa has substantial transboundary rivers (over 64) shared by 2 or more countries. With that said only 7% of Africa’s hydropower has been developed and efficiently irrigated areas only cover about 6% of the total cultivated land. This can be improved.
  • Investment Landscape and Alternative Finance Models: SIWI feels that investments in water infrastructure are just not currently happening. There are deserving projects and feasibility studies to justify them yet models are not well developed with regards to taxes, tariffs and transfers. Resultantly opportunities are missed due to single purpose infrastructure focus. Other models such as blended finance (commercial plus development plus private sector funding) or offset finance (reduced future expenditure on disaster relief or water losses) could be adopted to pay for infrastructure. Exploring these approaches could allow for the development of more sustainable water development in the project. The development of the Grand Ethiopian Renaissance Dam was highlighted as an example of innovative financing, albeit with its challenges.
  • Concluding thoughts: Earle concluded with the facts that good governance is needed but not a sufficient condition to attract investment – social and environmental issues need to be addressed. Earlier interception is needed to ensure the adoption of the correct and innovative financial models in order to enhance developmental impact.

Secondly, Mr Mleta provided in-depth insights into the policy and legislative framework for water resources management in Malawi. The main points covered included:

  • Contextualisation: The initial Malawi water policy came into effect in 1994 and was designed to guide the country in the sustainable use of water and sanitation but mainly focused on water services delivery. In 2000, this was revised and finally evolved into the 2005 National Water Policy.
  • The National Water Policy 2005: The policy vision statement is ‘Water and Sanitation for All, Always’ and covers several areas including those relating to water resources management, water quality and pollution control, water utilization, disaster management as well as institutional roles and linkages.
  • Institutional Roles and Linkages: The 2005 policy recognizes that the management of water resources requires an integrated approach which means the involvement of various stakeholders should be key including – the Ministry, local governments, NGOs and civil society, private sector, local universities and other local training institutions.
  • The Water Resources Act 2013: Intended to implement National Water Policy of 2005 in respect of water resources management. It became effective on 1st December 2013 and provides the management, conservation, use and control of water resources.
  • The National Water Resources Authority (NWRA): Established under the Water Resources Act 2013, the authority has the power and function to develop principles, guidelines and procedures for the allocation of water resources, allocate permits, advise the ministry, determine charges and undertake prosecution.
  • Association for Water Users (AWU): This was established to manage, distribute and conserve water from a source used jointly by the members and manage groundwater resources and to acquire and operate an abstraction license or discharge permit.
  • Current Initiatives: The Ministry has developed a new Water Resources Investment Strategy, Water Resources Master Plan and Irrigation Policy and Master Plan. These are currently being driven forward and implemented.
  • Working with Scotland: Mleta concluded with reflections on the successful developments resulting from a collaboration with the Scottish Government Funded Climate Justice Project on Groundwater Resources which ran from 2011 to 2015. It comprised part of the Water Futures Programme hosted by the University of Strathclyde and led by Professor Robert Kalin and undertook an evaluation of every rural water supply position in Chikwawa District Malawi.
  • Concluding reflections: Malawi was among one of the first countries to commit to Sustainable Development Goal 6 and this in concretely incorporated into their policy and legislation. They are committed to ensuring clean and safe drinking for all and are determined to establish robust governance structures and adequate public and private investment.

Numerous questions were directed towards the presenters including how diaspora could become more involved, what lessons can be learnt from the Ethiopian context, how pricing can be streamlined, what is the most effective approach to governing water supply (public or private) and which countries have found success in alternative financing models.

Conversation continued during the drinks reception and contacts were made. We look forward to hosting the next Scottish Business in Africa Forum in early 2017, please check the website for details.

SBIAF Water Event speakers

Further information