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Water and Energy

MENA's Water Crisis Requires Institutional Reform as Well as New Infrastructure

Desalination, reuse and network investment will remain essential. They will not be enough unless the institutions responsible for allocation, tariffs, operations and public trust are strengthened at the same time.

MZA Consultancy · 15 May 2023 · 9 min read

The World Bank’s latest assessment of water scarcity in the Middle East and North Africa is severe. By 2030, annual water availability per person in the region is expected to fall below 500 cubic metres, the threshold commonly associated with absolute scarcity. By 2050, the region may need an additional 25 billion cubic metres of water each year to meet demand.

The scale is difficult to absorb. The World Bank compares that additional requirement with building dozens of very large desalination plants. Yet the report’s central message is not simply that MENA needs more infrastructure. It is that the current institutional approach to water allocation and management is no longer capable of carrying the burden alone.

This distinction matters. The region has already invested heavily in dams, treatment plants, desalination and distribution networks. New assets will remain necessary, especially as population, urbanisation and climate pressure increase. But an asset can add supply without solving the wider system problem.

Water scarcity is an allocation problem as well as a supply problem

Water is shared between cities, agriculture, industry and ecosystems. Decisions about who receives it, at what quality and at what price are political and economic decisions, even when they are presented as technical planning.

The World Bank argues that water allocation in many MENA countries remains highly centralised. This can make it difficult to manage local trade-offs or secure public acceptance for difficult changes. A ministry may set national priorities, while utilities, municipalities, irrigation authorities and local communities carry the consequences.

Institutional reform does not mean removing national control. It means clarifying responsibilities and giving the organisations closest to users enough authority to manage services, communicate choices and be held accountable for results. The next generation of water investment must strengthen the institutions that allocate, operate and pay for the service at the same time as it expands physical capacity.

Desalination solves one problem and creates several interfaces

Desalination will play a growing role in coastal countries. It offers a dependable source that is less exposed to rainfall. It is also capital intensive, energy intensive and operationally demanding.

A desalination project is not only a treatment plant. It includes marine intake and outfall systems, power supply, grid connection or dedicated generation, pumping, storage, conveyance and distribution. The cost of water at the plant boundary can be very different from the cost of delivering it to a city or industrial user hundreds of kilometres away.

Project development therefore needs to define the full service. If the plant is procured separately from the power and conveyance systems, responsibility for performance at the interfaces must be clear. If renewable energy is proposed, the sponsor must decide how intermittency, grid support and water production requirements will be managed.

Utilities need operating credibility, not only new assets

A new plant can be financed and constructed within a defined programme. Utility reform is slower and more difficult. It touches tariffs, staffing, maintenance, metering, customer relations and public expectations.

The World Bank highlights the need for stronger utility autonomy and better communication with customers, including around tariff changes. That is not a minor administrative issue. A utility that cannot recover sufficient revenue will struggle to maintain networks, purchase energy, replace equipment or service debt. The result is often a cycle in which public budgets fund new construction while existing assets deteriorate.

Affordability must remain central. Water is an essential service, and tariff reform without social protection can create hardship and political resistance. The objective should be a transparent system that protects vulnerable users while making the cost of service visible and maintaining the utility’s ability to operate.

Loss reduction and reuse deserve programme status

Supply projects attract attention because they are visible and measurable. Network rehabilitation, pressure management, metering and leakage reduction are less dramatic, but they can protect existing resources and delay the need for expensive new capacity.

Wastewater reuse also deserves to be treated as a strategic resource. Treated water can support agriculture, industry, landscaping and environmental uses, depending on quality standards and distribution infrastructure. Successful reuse requires more than a treatment plant. It requires users, contracts, monitoring, public confidence and a network that can deliver water to the right locations.

These interventions should not be considered small technical additions. Together, they form part of a national water portfolio that balances new supply with better use of existing resources.

The social contract cannot be excluded from project design

Water decisions affect households, farmers, industry and regions differently. A technically efficient allocation may still fail if users do not understand the basis for it or believe that the burden is unfair.

The World Bank recommends clearer communication and more legitimate local decision-making around difficult trade-offs. For project sponsors, this means stakeholder engagement should begin before procurement. Communities need to understand why a project is required, how tariffs or service levels may change, and what environmental impacts are being managed.

Public communication should not be treated as a campaign launched after opposition appears. It should be part of the project governance structure, with clear responsibilities, evidence and channels for feedback.

From individual assets to national water programmes

The most credible response to MENA’s water challenge is a programme approach. Governments should identify the role of desalination, groundwater, surface water, reuse, storage, conservation and network improvement within one long-term plan.

That plan should connect projects with institutional responsibilities. It should state who will procure, own and operate each asset; how electricity will be supplied; how costs will be recovered; how environmental requirements will be met; and how performance will be reported.

International engineering firms, developers, operators and technology providers can contribute substantial capacity. Their participation will be strongest where public sponsors provide a clear pathway, realistic risk allocation and reliable data.

MENA needs more water infrastructure. The World Bank’s warning is that construction alone will not be sufficient. The region’s next generation of water investment must strengthen the institutions that allocate, operate and pay for the service at the same time as it expands physical capacity.

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