Opinion: Why water and sanitation systems are vital for our economies

Do decision-makers place the correct level of policy prioritization and investment commensurate given water and sanitation’s critical importance? The answer, in far too many parts of the world, is a resounding “No.” As an international community, we are too often blind to the huge costs in failing to serve so many people with the most basic but crucial of services.

Today, there are still 2.2 billion people without access to safe drinking water and 4.2 billion who don’t have a safe place to go the toilet. Reaching all of these people with sustainable services will take much more than physical infrastructure. Even where this infrastructure is already being improved, the systems and resourcing to expand them to everyone and keep them running are frequently insufficient.

Investments need to grow — to an annual $114 billion, according to the World Bank — to meet the scale of the challenge. However, this is not a plea for charity, this is a wake-up call.

The current global water and sanitation crisis is a story of colossal, rapidly increasing, unmet demand leading to colossal, rapidly increasing costs. Meeting Sustainable Development Goal 6 — water and sanitation for all by 2030 — is not a burden but a massive opportunity.

To find concrete solutions to the financing gap, the partnership Sanitation and Water for All — a global platform for achieving the WASH-related targets of the SDGs — is organizing three Regional Finance Ministers’ Meetings during November and December. There we will focus on the fact that expanding water and sanitation services by strengthening the systems that deliver them is the bedrock of economic growth and sustainable development.

With the right level of investment, benefits could include an estimated growth in gross domestic product by 1.5% and a $4.3 return for every dollar invested. This is due to the likely reduced health care costs and potential for increased productivity. That’s a rate of return that any investor would wish for.

The cost of not investing

We also take into consideration the impact of not investing. Affordable, reliable, easily accessible water and sanitation services prevent thousands of children dying every year from preventable diseases such as diarrhea and cholera. Healthier children absorb nutrients properly, develop stronger brains and bodies, get better school results, and end up making a fuller contribution to society.

And we have seen all too recently how quickly a pandemic such as COVID-19 can spread when people are not able to wash their hands with water and soap.

Without further investment, girls and women are forced to continue the time-consuming, back-breaking work of fetching water and are left exposed to the indignity and dangers of going to the toilet in insecure facilities or in the fields and streets.

Water and sanitation services in schools and workplaces have the power to ensure girls and women can manage their personal hygiene while not missing out on obtaining an education or earning income.

Adequate investments could see disease burden and epidemic risk reduced, and fast-moving killers such as cholera slowed down. For example, improved hygiene — through water and soap — is critical in the fight against COVID-19. Yet 1 in 4 — 24% — of health care facilities lack basic water services, 1 in 10 — 10% — have no sanitation service, and 1 in 3 — 32% — lack hand hygiene facilities at points of care.

Data has shown that even where there is adequate WASH facilities, frontline health care workers can be at 12 times more risk of testing positive for COVID-19 compared with individuals in the general community. 

Unless further investments are made, the level of productivity amid a workforce is capped. An estimated 3 out of 4 jobs that make up the global workforce are either heavily or moderately dependent on water.

But having access to water and sanitation can also free up time — that would otherwise be spent collecting water — on economic activities. UN-Water estimates that improved sanitation gives every household an additional 1,000 hours a year to work, study, care for children, and so on. Women’s productivity is particularly affected by lack of these services, as they are the main caretakers and manager and users of water.

The bottom line is that economic growth rests on improving educational achievement and public health — two things that are impossible without access to WASH.

The role of finance decision-makers

None of this is news. Since the early days of the industrial revolution, we have known the transformative economic and social benefits of access to WASH, and the horrific consequences of inaction.

If finance ministers fail to help prioritize water and sanitation, the consequences could affect societies for generations. Financial decision-makers must create an enabling environment by investing in institutions and people and mobilize new sources of finance such as taxes, tariffs, transfers, or repayable finance.

Many countries are already implementing some of these measurements and seeing the immediate advantages. In 2014, Mali committed to move toward allocating at least 0.2% of GDP to hygiene and sanitation, and 5% of the national budget for water and sanitation.

Rwanda has created a public-private partnership with METITO company, to supply drinking water in the city of Kigali. This partnership increased private sector participation in WASH, front loading investments to make sure services are available sooner.

And Kenya has had great results using shadow credit ratings for utilities to attract domestic and international finance. An interesting outcome of the Kenya experience in terms of aid effectiveness and targeting is that one bilateral agency denied a grant to one Kenyan county that had applied to them for funding, because the report clearly showed a healthy utility with plenty of cash and ability to borrow. The funds were instead diverted to another county which was in greater need of financial support.

In the end, well-resourced, well-run WASH systems are catalysts for progress in every sector from gender, food, and education, to health, industry, and the environment.

By nature of their work, finance ministers must use evidence to make smart decisions that will help their counties to flourish. In the case of WASH, the evidence is clear: Continuing to neglect these services will only continue to stunt the growth of our economies, populations, and societies.