Water is one of the most basic human needs. With impacts on agriculture, education, energy, health, gender equity, and livelihood, water management underlies the most basic development challenges. Water is under unprecedented pressures as growing populations and economies demand more of it. Practically every development challenge of the 21st century – food security, managing rapid urbanization, energy security, environmental protection, adapting to climate change – requires urgent attention to water resources management. 

Yet already, groundwater is being depleted faster than it is being replenished and worsening water quality degrades the environment and adds to costs. The pressures on water resources are expected to worsen because of climate change. There is ample evidence that climate change will increase hydrologic variability, resulting in extreme weather events such as droughts floods, and major storms. It will continue to have a profound impact on economies, health, lives, and livelihoods. The poorest people will suffer most. 

The World Bank places Water Resources Management at the center of its efforts to help countries adapt to and mitigate the effects of climate change.  It also seeks to ensure that Water issues are effectively addressed in related sectors, such as agriculture, disaster risk management, energy, and health.

The World Bank is one of the key external financiers in water resources management, and one of the leading providers of knowledge and technical assistance on water.  Overall, water lending accounts for 15% of the Bank’s  portfolio. World Bank funding has responded to the need to address both water development and management issues by promoting integrated water resources planning and by tackling institutional reforms along with infrastructure upgrades in various sectors. These sectors include contributions to flood management, hydropower, agriculture water management, pollution control, transboundary water management, and climate change adaptation and mitigation activities. The World Bank will continue to play a key role by working across sectors, countries and with institutions and diverse stakeholders to help countries build resilience to climate change through water resources management. 

The Bank has launched an initiative analyzing economic impact and tradeoffs to help the energy sector increase its awareness and improve management of the massive amounts of water needed for energy production.  The Bank also supports transformational engagements, which seek to optimize spatial, green and co-benefits among water and other infrastructure sectors. The Mozambique Water Resources Development project, for example, combines multi-purpose use of water and governance components to increase the yield of the Corumana Dam.

A large proportion of World Bank-funded water resources management projects include institutional and policy components. In Morocco, a Water Sector Development Policy Loan (US$100 million) in 2007 supported comprehensive water reform to address legislative, financing and planning gaps in the water sector. This work led to a reform program in which water-demand management, conservation, and resource management became new thrusts in Morocco’s water strategy. 

With 263 international rivers in the world, supporting cooperative water management is an important contribution for fostering gains from water resources to alleviate poverty. The Bank supports the joint management of transboundary watercourses in various ways, especially in Africa. In the Senegal River Basin, World Bank projects have contributed to more effective management of the resources of the Senegal River and to the inclusion of Guinea into the organization responsible for this management, allowing integrated water resources management in the entire basin. In the Mekong River Basin, the Bank is supporting riparian states such as Cambodia and the Lao People’s Democratic Republic in strengthening their integrated water resource management and disaster risk management capacities, cooperating closely with the Mekong River Commission that cooperatively manages the basin. 

The Bank follows an integrated flood management agenda, which includes well-functioning early warning systems, infrastructure, and institutional arrangements for coordinated action to address increased variability and changes to runoff and flooding patterns. In Yemen, World Bank financing (US$80 million total) provided vital flood control structures in and around the city of Taiz. By the project's closing in 2008, major parts of Taiz had been transformed into livable and flash flood-secure neighborhoods. The project contributed to an increase in land values of more than 100 percent and a reduction in damages to residential properties and businesses from 160 and 660 per year to zero. Flood structure and complementary wastewater connections helped to improve health and sanitary conditions by reducing the flow of wastewater into wadis (riverbeds), which had become breeding grounds for malaria-carrying mosquitoes. In China, the Hai Basin Integrated Water and Environment Management Project, completed in 2011, promoted an integrated approach to water resource management and pollution control and contributed to the restoration and protection of marine environments, ecosystems, and biodiversity in the Bohai Sea. It was implemented in 16 counties in northern China, benefitting over 20 million people. Better water use and pollution control in the Basin has improved resident health and living standards. Farmers also benefited from more efficient consumption-based irrigation management, which increased water productivity, crop yields, and incomes.