Modernizing Water Systems for Sustainability and Growth Across Europe and Central Asia

The World Bank's report highlights the critical need for water security in Europe and Central Asia to address climate risks, transboundary dependencies, and inequities in water access. It calls for investments in modernized infrastructure, sustainable practices, and regional cooperation to ensure economic growth, public health, and environmental resilience.

The World Bank, with contributions from institutions such as the International Institute for Applied Systems Analysis (IIASA), HYDROPHIL GmbH, and InterSus–Sustainability Services, has published a report that underscores the critical role of water security in driving economic growth, ensuring environmental sustainability, and enhancing resilience in a diverse region spanning the Danube, Central Asia, and the South Caucasus. Water is vital for economic stability in the region, powering hydropower plants that produce 27% of electricity and irrigating agriculture, which provides up to 80% of revenue in Central Asia. However, the region faces stark disparities in water availability and productivity, with high-performing countries like Slovakia juxtaposed against nations like the Kyrgyz Republic, where inefficient irrigation systems limit agricultural output. Strengthening water security is not just an environmental necessity but a cornerstone for regional prosperity.

Bridging the Urban-Rural Divide in Water Access

Despite notable progress, inequities in water and sanitation services persist across Europe and Central Asia, particularly between urban and rural populations. While urban areas generally have better access to infrastructure, aging systems and inadequate maintenance reduce efficiency, leaving significant gaps. In rural areas, the disparities are even more pronounced. Over 35% of the regional population lacks safely managed water services and rural sanitation coverage remains alarmingly low. For instance, more than 50% of rural residents in countries like Albania and Kyrgyzstan do not have access to safely managed sanitation. Marginalized groups, such as the Roma community in Albania, are disproportionately affected, with unsafe water and sanitation posing severe health risks. Addressing these gaps requires innovative, localized solutions, such as off-network systems and nature-based infrastructure. Expanding access to safely managed services would not only improve health outcomes but also enhance education opportunities, labor productivity, and overall socioeconomic resilience.

Transboundary Cooperation: A Key to Regional Water Management

The region’s reliance on transboundary water sources highlights the critical need for cooperation in water management. Over 40% of surface water flows cross national boundaries, creating complex challenges for governance. While the Danube River Basin exemplifies successful transboundary collaboration, supported by entities like the International Commission for the Protection of the Danube River, similar frameworks remain underdeveloped in Central Asia and the South Caucasus. Central Asia, with its dependence on the Amu Darya and Syr Darya rivers, faces unique vulnerabilities, including outdated irrigation systems and inefficient water use, which lead to substantial losses. Climate change exacerbates these challenges, with reduced snowmelt and rising temperatures threatening water availability in downstream regions. Enhanced transboundary agreements and shared management strategies are essential to address these issues and ensure sustainable water distribution across borders. Cooperation at the regional level could unlock significant social, economic, and environmental benefits.

The Growing Threat of Climate Change to Water Security

Climate change poses a severe threat to water resources in Europe and Central Asia, intensifying risks such as droughts, floods, and seasonal water variability. Rising temperatures and shifting precipitation patterns have cascading effects on agriculture, energy production, and public health. Low-income countries in Central Asia are particularly vulnerable, with economic losses from extreme weather events projected to reach 1.3% of GDP annually. Agricultural yields could decline by up to 30% by 2050 without significant adaptation measures. The report highlights the urgent need for climate-resilient infrastructure, including modernized irrigation systems, efficient water reuse technologies, and expanded storage capacities. For instance, rehabilitating irrigation infrastructure in Central Asia could increase crop yields by 50% by 2050. Investing in such adaptive measures is critical for reducing vulnerabilities and building resilience in the face of a changing climate.

Investing in a Sustainable Water Future

Achieving water-related Sustainable Development Goals (SDGs) in Europe and Central Asia will require substantial investments, estimated at $77 billion annually, equivalent to 0.6% of the region’s GDP. Central Asia and the South Caucasus, where governance and infrastructure gaps are most pronounced, will need to allocate a larger share of their GDP to address these challenges. The report identifies key priorities for investment, including modernizing water management systems, expanding wastewater treatment facilities, and improving water-use efficiency in agriculture and industry. These investments are not just costs but opportunities to drive economic growth, reduce environmental degradation, and enhance social equity. For example, addressing non-revenue water losses, which reach as high as 75% in the South Caucasus, could yield significant financial and resource savings. Strengthening institutional capacities, adopting smart technologies, and fostering regional cooperation are equally critical to achieving long-term water security.

The report concludes with a call to action for governments, international organizations, and private stakeholders to collaborate in building a resilient and equitable water future. By addressing governance challenges, modernizing infrastructure, and prioritizing sustainable practices, Europe and Central Asia can secure their water resources and navigate the growing impacts of climate change. Water security is not just an environmental issue but a fundamental enabler of economic growth, public health, and regional stability. With coordinated efforts and strategic investments, the region has the potential to transform its water challenges into opportunities for a more sustainable and prosperous future.