Considerations for Financial Facilities to Support Water Utilities in the COVID-19 Crisis
The objective of this document is to lay out the options and considerations in the design of facilities to provide emergency financial support to water utilities in response to the COVID-19 pandemic. It builds on the experiences of previous financi...
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/695111593333338218/Considerations-for-Financial-Facilities-to-Support-Water-Utilities-in-the-COVID-19-Crisis http://hdl.handle.net/10986/34043 |
| Summary: | The objective of this document is to lay
out the options and considerations in the design of
facilities to provide emergency financial support to water
utilities in response to the COVID-19 pandemic. It builds on
the experiences of previous financial crises (such as the
global financial crisis of 2007–08 and the Asian Financial
Crisis of 1997), including their impact and responses to
them. Its main audience is government policy makers trying
to develop financial responses to ensure utilities continue
to function during the crisis, as well as the World Bank
country teams and Task Team Leaders assisting them. The type
of facility described in this document may be based on an
existing one or related mechanisms (fiscal transfers,
guarantees, subsidy programs, or others), or it could be the
kernel of a new institution or financing instrument that may
continue to have a role in sector financing after the
crisis. Considering this, the paper recognizes that there
will likely be a need to consider new external borrowing in
the context of ensuring macroeconomic and fiscal stability.
Many emerging markets were already showing signs of
over-indebtedness before the COVID-19 crisis and the costs
associated with the pandemic will only increase the demand
for resources, including public debt. Macro-economic
stability must be anchored on sustainable paths of public
and external debt, and countries will need to consider this
in coordination with ongoing initiatives by the Group of
Twenty (G20), the International Monetary Fund (IMF), and
others to ensure debt sustainability and transparency. |
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