18 February 2013

Nigeria: The Economic Benefit of Investing in Water

Studies have shown that investment in water resources is capable of increasing the GDP of a country.

Specifically, it is believed that a $1 investment in water can bring in a return of about $4 or $7.

However, while governments in Europe and America have already turned water resources into vibrant economic venture, in Africa, especially in Nigeria, water resources is still seen as a social amenity and is yet to be looked at as economic issue.

Stakeholders in water resources management converged on Abuja last week and deliberated on the best ways to manage water in a way it could grow the revenue base of the government.

The stakeholders included government ministries that are interested in water resource management, representatives of universities and donor agencies.

At the end of the meeting, stakeholders agreed that water should not just be used as essential resources but an economic commodity through which money can be generated. They believe that water should be priced and paid for. However, there is an issue with this because of the United Nations agreement that looked at water as essential commodity which everybody should have access to.

But the stakeholders advised that government should subsidise for those who cannot afford it, while those that can "should pay for the economic benefit of water."

It is said that about $20 billion is needed to provide water in Africa. Donors are contributing but their contribution is $4 billion.

"To increase this, national government should improve its national budget's contribution to water. If you look at governments in Africa, you would find out that water is not a priority. Agric, energy or infrastructure may be priorities. The percentage of GDP invested in water is very low," the Executive Secretary of African Ministers' Council on Water Mai Mass Taal said.

Speaking at the General Assembly of Partners of Global Water Partnership -Nigeria, Taal said water ministers in Africa should sit down with their finance ministers and address the water issue.

He said: "The finance ministers should understand that investment in water will yield dividend. We have done study that shows that non investment in water would reduce the GDP by 7 percent. If you invest in water you are going to increase the GDP. We cannot continue to rely on donor agencies. We have to do it ourselves." The question is what is the best way to look at water as economic resources?

Taal said the best way to look at water as economic resources is for people to be paying for water.

He said: People are not paying for water. The water is not priced. We have to price the water. Some countries are paying and some are not." But pricing water would be contrary to the UN's resolution that water is human right. That means that everybody should have access to water. If you cannot pay for the water, should you be denied water? This makes it a thorny issue.

There is an argument that if the poor can spend money buying airtime on their mobile phones, they should be able to pay for water. Taal wants people to change their attitudes and give what is necessary the priority.

The President of Partners of Global Water Partnership -Nigeria, Dr. Hassan Bdlya said the General Assembly meeting was to bring together all the interest groups in the water sector to galvanise what they have to offer as intellectual and entrepreneur "so that as a team we can assist the federal ministry of water resources on the management of what resources for the good of the country."

He said it is a platform for the people who will want to see the management of water resources improved upon as a mean of reducing poverty and moving the country forward. Dr. Bdlya said they have lined up different programmes for the implementation of water projects.

On the need to treat water resources as an economic issue, he said that he belongs to the school of thought that believes that water should be treated as "an economic resources and one way of doing it is to charge for the use of water, especially when it is provided to the people right into their home."

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