Dutch water sector brainstorms on funding water

Conducted by NWP and FMO, this sector consultation report assessed the financial challenges facing the Dutch water sector in reaching Sustainable Development Goal 6 (SDG 6) by 2030. After several interviews and group discussions with entities such as technology and equipment suppliers, contractors, and water utilities and authorities, the study revealed that the Dutch water sector could increase its market opportunities abroad by: 1) offering full-service integrated project solutions; 2) increasing collaboration with local partners; 3) structuring projects better through the early involvement of financial experts; and 4) creating a ‘one-stop-shop’ for funding instruments.

With these findings in mind, the next step is to identify pathways to an implementation phase. Divided into a round table discussion for each of the four statements, around 30 water stakeholders representing the Dutch Government and the industry, shared their ideas on how to move forward and identified possible next steps. 

Offering full-service solutions

At the table moderated by Frank Goossensen, President of the ‘kernteam internationaal’ (international core team) of the Top Sector Water and Maritime, participants touched on what ‘full-service project solutions’ really means and the different types of contracts underpinning them. They concluded that a more comprehensive mapping of the market is required, as different contexts call for different solutions (i.e. public vs private clients, local markets vs international markets etc.). Only then it will be possible to assess, one, exactly where the Dutch water sector could play a role, and, two, which areas could generate the biggest impact. 

It was also stated that ‘seamless financing’, whereby the project is put at the centre and the financing is wrapped around it, is crucial. Participants at this table highlighted that we should not ‘push orange too much’. In this regard, they advised the Dutch water sector to carefully select the solutions they master to promote internationally. They could identify local partners in areas such as operations and maintenance with whom they could develop full-service solutions. 

Increasing collaboration with local partners

The table moderated by the Dutch Special Envoy for International Water Affairs, Henk Ovink, also brainstormed about partnerships and acknowledged that a crucial success factor is to partner with local champions. Our guests concluded that the right alliances were the best means to: compete in terms of costs, and gain access to local networks and knowledge on operational and investment risks and manage these risks properly. Existing programmes such as WaterWorx, BlueDeal and Water as Leverage could lead us to – and in some cases are already providing – key local partners.

Another suggested way to foster closer collaboration was to set up marketplaces where public and private stakeholders can co-invest and work together to face challenges. It was also mentioned that a taskforce with the Dutch Government, NWP, FMO and other stakeholders could be developed in order to scope the market for tenders. This approach would allow the Dutch water sector to be informed about upcoming business opportunities and give it time to take stock of its assets before tenders come out.
 

Early involvement of financial expertise

Moderating the third discussion was Ronald Wormgoor, Deputy Director of the Dutch Ministry of Infrastructure and Water. In his recap of the table discussion, he mentioned that one means to achieve the early involvement of financial experts in project development could be by letting this sector take part in trade missions so that financial and technological expertise can merge. The upcoming trade mission to Indonesia in March could offer the first opportunity to try this recommendation. Another suggested step was to set up a ‘roster of financial experts’ that allows us to better determine who can provide what kind of expertise, and make sure that we leverage this expertise in different project phases.

Participants at this table also indicated that close collaboration with universities and youth networks like YEP Programmes should be boosted to invest in a new generation that is technically strong and able to work with the financial aspects around a project. In this regard, another recommendation was to allocate project budgets differently so that financial experts have more time to help structure projects. 

One-stop shop

Dutch funding instruments are fragmented, the landscape is hard to navigate and most instruments involve a lengthy process and are not adaptive enough to project needs. This discussion was moderated by Dennis van Peppen, Manager of Global Issues and Water at Netherlands Enterprise Agency (RVO.nl), who shared the table’s idea that proper coordination among the available financing instruments was needed to best serve the Dutch water sector. Our guests questioned whether the Dutch water sector provides sufficient guarantees for long-term contracts in emerging markets and whether available funding instruments were enough. They concluded that the sector should get together with ministries to address the supply side and review the existing instruments and risk-reduction methods.

The high-level dinner with the Dutch water sector generated a large pool of ideas to implement the recommendations of the sector consultation. At NWP, we look forward to starting the implementation phase to expand the horizon of the Dutch water sector. If you have more ideas or want to further elaborate on the ones presented, get in touch with us!