Water supply and sanitation in Indonesia

Source: Calculations based on [http://www.publicfinanceindonesia.org World Bank Indonesia Public Finance Data Page] . All figures are in current trillion Rupiah for 2005.

While it is not entirely clear how much of this sum has been invested in water supply and sanitation, the ADB estimates that only US$ 124m per year (average of 2004-2005) from the regular national budget were allocated to water supply and sanitation. [ [http://www.adb.org/Documents/Events/2006/WFP-Conference/Country-Highlights-INO.pdf ADB] ]

Since decentralization in the year 2001, local Governments have typically invested less than 2% of their annual budgets on water supply, even less on sanitation and almost nothing on improving hygiene practices. [ [http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2006/06/08/000090341_20060608110102/Rendered/INDEX/35503.txt World Bank, Annex 1] ] Assuming that 2% of local government (provincial and district) budgets are spent on water and sanitation, local government investments in water and sanitation were 3.6 trillion Rupiah or US$375m or about three times higher than the US$124m financed through the central budget. Total investments thus can be very tentatively estimated at about US$500m, or slightly more than what has been estimated by one source as the required investments to meet the MDGs, or US$450 million per year [ [http://www.usembassyjakarta.org/press_rel/US_PDAM.html US Embassy] ] At about US$2 per capita and year these investments still remain far lower than investments in water and sanitation in other middle-income countries.

The economic crisis of the late 1990s had severely curtailed investment in infrastructure. Central government spending on development dropped from US$14 billion in 1994 to US$5 billion in 2002, within which the share of infrastructure spending further declined from 57 to 30% over the same period. Moreover, according to the World Bank, poor institutional and regulatory frameworks and rampant corruption in the infrastructure sector, which were prevalent even before the crisis, continued without serious sector reform efforts by the government until today. [ [http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2006/06/08/000090341_20060608110102/Rendered/INDEX/35503.txt World Bank, Annex 1] ]

External support

External support to the water and sanitation sector in Indonesia is provided by
*international financial institutions, such as the World Bank and the Asian Development Bank,
*countries providing bilateral aid such as the United States, Canada, Japan, Australia and The Netherlands
*UN agencies such as UNICEF.

World Bank

The World Bank's Third Water Supply and Sanitation for Low Income communities Project for Indonesia aims to increase the number of low-income rural and peri-urban populations accessing improved water and sanitation facilities and practicing improved hygiene behaviors. The US$ 137.5m loan was approved in June 2006. The project will support community driven development (CDD) planning and management of water, sanitation and hygiene improvement programs, build stakeholder commitment and expand the capacity of central, provincial and district government agencies. It will also ensure that targeted community households gain access to improved sanitation facilities of their choice, are using improved water supply and sanitation infrastructure effectively and are progressively adopting key hygiene practices. Finally, it will provide participating communities with a menu of technical options for rural water supply and public sanitation infrastructure. The project is implemented by the Ministry of Health. [ [http://web.worldbank.org/external/projects/main?pagePK=64283627&piPK=73230&theSitePK=40941&menuPK=228424&Projectid=P085375 World Bank] ]

Asian Development Bank

The Community Water Services and Health Project will provide clean water and sanitation facilities to about 1,500 communities of rural Indonesia, including tsunami-affected areas. The project was approved in April 2005 comprising loans amounting to US$64.7 million and $16.5 million in an emergency assistance grant. The project will target 1,000 communities in 20 districts in the provinces of West and Central Kalimantan, Jambi, and Bengkulu, where the project will provide about 1.2 million people with safe drinking water and about half of these with improved sanitation. An additional five districts consisting of 500 communities in Aceh and Nias-North Sumatra affected by the December 2004 earthquake and tsunami disaster will be covered under a complementary emergency assistance grant package. The project will give local governments the capacity to plan sustainable investments. It will also conduct advocacy and awareness training among the communities to build capacity for them to operate and maintain new water and sanitation facilities that will be built through the project. To maximize the health impact of the project investments, the project will finance hygiene promotion at schools, religious facilities, and among the communities. The Directorate General of Communicable Disease Control and Environmental Health of the Ministry of Health is the executing agency of the project [ [http://www.adb.org/Media/Articles/2005/7293_Indonesia_water/ ADB] ]

United States

Since early 2005 USAID has provided technical assistance to water utilities (PDAMs) in Java and Sumatra on issues related to full cost recovery tariffs and improved technical operation, with the objective of improving their creditworthiness and ability to borrow to meet network expansion needs. USAID is also looking at ways to use its partial credit guarantee mechanism to further increase local water utilities’ access to commercial financing. [ [http://www.usembassyjakarta.org/press_rel/US_PDAM.html US Embassy] ]

Canada

CARE Canada and the Canadian International Development Agency (CIDA) support the CARE-Sulawesi Rural Community Development Project (SRCD). The emphasis of the SRCD project is as much on developing the rural communities as it is on providing water supply and improving sanitation. CARE uses the "community management approach", by which communities are heavily involved right from the very beginning, from the design through construction, implementation, operation and maintenance.

The approach works by establishing a village water committee and a series of sub-committees: for example, sanitation, construction and finance. The village itself decides how it will raise the amount of money needed for its contribution to the project. This is usually done by monthly levy whereby each family contributes a small amount of money over the course of four to six months. The village construction committee also organizes the labour to install the system. All the labour is done manually without the use of heavy machinery, which means a low environmental impact and lower cost. With water close at hand, most households are also building their own simple latrines. [ [http://www.acdi-cida.gc.ca/CIDAWEB/acdicida.nsf/En/STE-320162235-T7L CIDA] ]

The Netherlands

The public Dutch water company Water Supply Company Drenthe (WMD) and Dutch development aid support various water companies in Eastern Indonesia. Joint venture contracts have been concluded with four companies (Ambon, Bacau (Maluku), Biak, Sorong (Irian Jaya/Papua), negotiations are going on with seven other companies in North Sulawesi, Maluku and Papua. The WMD has reserved 3.4 million euros for the project. These amounts are intended to fund the first five years. [ [http://www.wmd.nl/english/projects/Indonesia/index.html WMD] ]

UNICEF

UNICEF supports the Indonesian government in developing and implementing strategies that improve drinking water and sanitation conditions across the country. UNICEF also assists the government in improving relevant planning mechanisms, monitoring systems and databases. UNICEF continues to play a pivotal role as the water and sanitation sectoral coordinator for the post-tsunami response in Aceh and North Sumatra, developing partnership frameworks that pool competencies and resources across organizations. [ [http://www.unicef.org/indonesia/wes_2880.html UNICEF] ]

References


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