World Bank approves $250m in financing to improve water services in Jordan

AMMAN — The World Bank has approved $250 million in financing to improve the efficiency of water services in Jordan through the rehabilitation of water distribution networks, improving energy efficiency and strengthening the drought management system in the Kingdom.

Jordan is one of the most water-scare countries in the world, and the anticipated outcomes of this Project are significant and wide-reaching. The project will deliver impact for people and the planet by reducing water losses, reducing electricity usage and improving water management systems, according to a statement from the World Bank. 

An estimated 1.6 million people will benefit from improved water services. Water system management will also be strengthened for farmers and industries, building economic productivity and strengthening the country’s resilience to climate shocks, the statement said.

The approved financing for the new Jordan Water Sector Efficiency Project consists of a $200 million loan from the International Bank for Reconstruction and Development (IBRD) and a $50 million grant from the Global Concessional Financing Facility (GCFF). 

Launched in 2016, the GCFF provides concessional financing to middle income countries hosting large numbers of refugees.  The project will target areas with higher refugee populations, providing benefits to both the refugees and the host community. 

Jordan is one of the most water-scarce countries in the world and is grappling with a severe water crisis constrain the country’s economic and human development. With only 97 m3 of available water per capita per year, the water supply is significantly below the absolute water scarcity threshold of 500 m3 per capita per year. 

Over the past decade, population growth and the influx of refugees have severely strained water service delivery. Moreover, the combination of climate change and population growth is expected to further reduce per capita water resources availability by 30 per cent by 2040. 

Limited water availability in Jordan is exacerbated by the fact that much of the water allocated for municipal use is lost: Over 50 per cent of municipal water either leaks from pipes or is not paid for by the consumer and is considered non-revenue water (NRW). 

To address Jordan’s water crisis and to meet the growing demand for water, the country is adopting bold water supply and demand-side actions and efficiency measures. The approved financing is intended to be the first in a proposed series of projects aimed at supporting Jordan in addressing water losses, promoting efficiency, enhancing service delivery, and improving financial sustainability of the water sector.

“The Government of Jordan has been proactive in analysing water scarcity challenges and in formulating adaptive response measures” said Jean-Christophe Carret, World Bank Country Director for the Middle East Department. “This new financing provides the investment support and long-term programmatic approach needed to mobilise major investments in infrastructure and institutional reform, linking planning with action to improve the efficiency and resilience of the water sector in Jordan.”

The Jordan Water Sector Efficiency Project will address three key areas: It will focus on sustainable reduction of NRW by rehabilitating water supply infrastructure, modernising water supply systems and engaging customers and communities. The project will also enhance energy efficiency and the reduction of energy supply costs. The project will implement measures for water security and drought management that will serve as a foundation for improving efficiency in the water sector and adapting to the challenges posed by climate change.

The Jordan Water Sector Efficiency Project is fully aligned with the Government’s Water Sector Strategy adopted in March 2023 and the Financial Sustainability Roadmap for the Water Sector adopted by the Cabinet of Ministers in November 2022. The project also supports the implementation of key recommendations from the Jordan Country Climate and Development Report, which prioritise water sector efficiency, loss reduction, drought risk management, promotion of water-energy nexus solutions and water security, according to the statement.

The implementation of measures to reduce water losses is projected to save approximately 10 million cubic meters of water. This will improve water services for the people of Jordan and contribute to climate resilience. Furthermore, the project will contribute to reduced electricity use in the sector and reduced electricity costs. The project will establish a robust drought management system to improve water management practices. This system will bring benefits to households, farmers, and industries during recurrent droughts faced by Jordan, including those caused by the impacts of climate change.