Private sector responses to water scarcity in the Hashemite Kingdom of Jordan
Creators: name: Glatzel, Katrin
Publisher: name: Imperial College London
Year: 2013

description: Until recently climate change adaptation was not on the agenda of international climate negotiations. Only at the 7th Conference of the Parties in 2001 in Marrakech, the particular vulnerability of developing countries to climate change and the need for adaptation was recognised. At the COP 15 in 2009 in Copenhagen the importance of the private sector in funding adaptation projects was emphasised amid the global economic crisis and the public sector’s inability to finance adaptation projects alone. In the Middle East water scarcity presents one of the largest challenges of the future, worsened by climate change. This thesis highlights the importance of adaptation to climate change, with particular focus on the water sector in the Hashemite Kingdom of Jordan, a country which has been identified as a prime example of an emerging economy and Middle Income Country with one of the lowest freshwater availabilities per capita in the world. Despite water scarcity, water usage and management is inefficient, levels of unaccounted-for-water are high and agriculture consumes around two thirds of water resources on extremely low tariffs. At the same time, Jordan’s economy has suffered considerably under the economic crisis, and as an emerging economy is not able to independently finance projects to improve water management and access to safe drinking water over the long term. Jordan will therefore be heavily dependent on foreign development aid as well as private sector investments. Consequently, Jordan was chosen by the author as it makes a good case study for analysis. The thesis aims to identify the drivers and barriers to private sector responses to water scarcity in Jordan and will produce a set of policy recommendations for attracting private sector capital to invest in, what has been identified as, adaptation technologies in a resource poor country. These guidelines will be useful to policymakers and private companies alike. The recommendations given herein provide a basis for enhancing private sector investments in the water sector in Jordan. Though they are specific to Jordan, these recommendations are valid and can be translated to other scenarios under which a Middle Income Country government aims to attract private sector finance for climate change adaptation projects provided that similar political, economic, cultural and environmental conditions prevail: 1. Eliminate corruption 2. Create long-term prospects for investors (especially under uncertainty about climate change and its effects) 3. Build confidence for investors 4. Develop a solid legislative framework and risk-sharing scheme 5. Adaptation makes business sense: open adaptation to climate change as a new market for innovation and investments 6. Achieve high levels of transparency in the award of projects and contracts 7. Develop a regulatory framework that defines the water consumption for agriculture (proportionate to GDP and available water resources) 8. Ensure consistency and coherence in policy-making. Avoid an implementation deficit 9. Frame a trend in climate that requires an adaptation strategy in the context of climate change