Africa’s future is urban – Here’s how we ensure it’s resilient

By Smita Rawoot, Urban Resilience Lead at WRI | November 10, 2022

Africa is the world’s fastest urbanizing continent. By 2050, its cities are expected to nearly triple in population. City leaders are already struggling to keep up, especially when it comes to water. Nearly 63% of urban areas in sub-Saharan Africa lack access to basic water and sanitation. Meanwhile, in the past decade alone floods and droughts have caused 80% of the disaster related deaths and 70% of the economic losses in sub-Saharan Africa.

Businesses, ecosystems and community health are all under threat if we don’t invest in water. The good news is financing is slowly coming in. As the conversations at COP27 revolve around whether developed countries will commit to finance adaptation measures, we must also consider how to coordinate committed funds for maximum impact. There is a $66-billion backlog in water and sanitation infrastructure investment in sub-Saharan Africa. And even if every city on the continent were to clear this backlog today, they would still need an investment of $9-14 billion every year to ensure reliable water supply.

The African Cities Water Adaptation Fund (ACWA Fund) is a new Africa-focused blended finance instrument that aims to work differently. The ACWA Fund, launched by WRI together with public and private sector partners, development banks, impact investors, state and non-state actors and experts, supports city leaders to fund and scale high-impact water resilience solutions across Africa. By leveraging private financing while better coordinating public sector funds alongside climate and development aid, the ACWA Fund and its supporting ACWA Platform aims to support the development and implementation of more than 200 projects in 100 African cities by 2032.

Why We Need to Act

A focus on water resilience is important for the African continent and globally because water underpins human health, economic development and ecosystem sustenance.  Imagine a city running out of water – homes and businesses go for days without cleaning, hospitals halt many of their services, residents line up in the middle of the night to collect water, risking human health, the economy and public safety. This is the reality for millions of people around the world in cities like Cape Town, Bangalore, Gqeberha, Sao Paulo, Cairo and Jakarta, which have faced “Day Zero” events where all available water sources dry up or nearly dry up.

In addition, there is no climate resilience without water resilience. At the extremes of climate-induced changes, too little and too much water are simultaneously impacting regions across the world. Climate change and poorly managed urban water systems across low-income countries have led to an increasing number of cities facing chronic water shortages and more frequent and intense flooding, resulting in difficulties meeting the basic needs of burgeoning urban populations as well as protecting them.

Cities in Africa are especially vulnerable and need system-wide support to build water resilience.

Financing the Future

The ACWA Fund takes a holistic approach to financing cutting-edge, city-wide water resilience solutions, providing guidance at every stage of a project’s lifecycle as well as connecting to regional and watershed stakeholders.

We help municipal officials make use of the most up-to-date information and tools to assess their risks and opportunities. By providing access to grants, we help cities secure the increased resources they need to develop City Water Resilience Plans and identify context-specific solutions to their most pressing needs.

The ACWA Fund is supported by a constellation of water, sanitation, health, business, infrastructure and governance, the ACWA Platform, whose expertise helps cities develop a portfolio of low-cost, high-impact resilience solutions. City stakeholders will work with the ACWA Platform to develop investment-ready projects with high resilience and scaling potential.

Depending on a city’s needs, supported projects may range from deploying micro-loans for installation of rainwater harvesting solutions at a neighborhood scale, financing natural stabilization ponds for wastewater treatment, and utilizing grants and concessional loans. Every solution developed with cities will work towards goals with multiple benefits: reliable, high-quality water supply; safe, cost-effective sanitation; and improved flood control.

With this portfolio of bankable projects in hand, the ACWA Fund will then connect cities to concessional and non-concessional capital, helping to structure deals responsive to city needs. Through direct investments, in the form of equity or subordinated debt, will aim to connect cities to the resources needed to roll out innovative projects that transform lives and create markets for low-carbon, resilient solutions.

If we don’t act now, climate change has the potential to wreak havoc in African cities already dealing with grave inequities and governance challenges. Preparing cities means providing them with the resources and support they need to not only meet growing demands for more equitable, reliable and resilient water systems but to bolster against intensifying climate impacts as well.

Further resources

• ACWA Fund
• ACWA Platform
• 2030 Joint Agenda