Investing in Africa's water future: Reflections on the AU Summit 2026

By Prof. Djiby Thiam | Director, WPE

The 39th Ordinary Session of the Assembly of Heads of State and Government of the African Union (AU) took place from the 14th to the 15th of February 2026 in Addis Ababa, Ethiopia. This year, the summit has put a strong emphasis on the role of water and sanitation services in driving the structural transformation of the continent, announcing 2026 the Year of Water Sustainability. The African Union Theme of the Year 2026: A Call to Action for Safe Water and Sanitation to drive Africa’s Development Agenda.

The theme of this year's summit is "Assuring Sustainable Water Availability and Safe Sanitation Systems to Achieve the Goals of Agenda 2063". This call is not just timely, but also relevant given the important role water and sanitation play in guaranteeing human dignity, supporting economic productivity, and promoting women's empowerment, particularly in remote and enclaved areas on the continent. It is important to highlight that for quite some time, questions related to water management and allocation principles have been addressed in a fragmented, top-down manner, leaving little room for feedback from communities and business leaders on how water policies and regulatory frameworks were designed. I offer some reflections on critical avenues, though non-exhaustive, that might support the achievement of the Africa Water Vision 2026 set by African leaders during the latest summit: an Africa where there is an equitable and sustainable management of water resources for poverty alleviation, socio-economic development, regional cooperation, and the environment.

Investments in water infrastructure

First, governments across the continent might want to take more aggressive actions regarding the amount and types of investments spent in water supply, sanitation facilities, and wastewater treatment infrastructures. The African population is expected to reach 2.5 billion inhabitants by 2050 (representing more than 25% of the world population). This increase not only enhances the volume of water needed for direct use in residential areas, but also through different value chain processing services that cut across several sectors. From agriculture to industrial development and service provisions, water is used as a critical resource that can hardly be substituted by an alternative resource. As a result, African governments might want to dedicate more financial resources (ideally between 15 and 20% of their respective Gross Domestic Product (GDP) over the coming 10 years) to water and sanitation-related investments to support economic performance. This time, it might be useful to rely more closely on internal resource mobilisation through appropriate domestic initiatives. Wherever possible, African financial and monetary institutions should take the lead in financing African infrastructure. The current geopolitical uncertainty underscores that one of the most effective ways to build resilience is to rely on internal resources, while maintaining strategic corridors of cooperation in sectors that require external expertise to mature. Such partnerships, however, should be accompanied by clear monitoring and evaluation mechanisms to ensure effective technology transfer and long-term capacity building.

Previous estimates suggest that achieving sustainable water and sanitation services by 2030 will require an annual investment of approximately US$ 50 billion, further reinforcing the urgency of strengthening domestic financing mechanisms across the continent. Although this amount may appear exorbitant, particularly given the many other urgent national priorities the continent must address, comprehensive reform in the natural resource sector, combined with more ambitious, context-specific fiscal and monetary reforms, could help mitigate the risks associated with volatile capital flows. In short, we may need to rethink the way economic policies are designed and implemented to support the growth and development of a more formalised private sector, which, in turn, contributes to expanding the fiscal base and developing local expertise to create more autonomy in technological development, fiscal sequencing, and overall public policy consistency.

Subsequently, in the water and sanitation sectors, a certain level of blended financing may initially be required to lay the foundation for private sector participation and large-scale infrastructure development. In parallel with nationally driven initiatives, the regional entities, such as the Southern African Development Community (SADC), Economic Community of West African States (ECOWAS), and East African Community (EAC), could promote coordinated regional projects focused on the management of transboundary water resources.

Regulatory improvements

Second, in addition to strengthening African-led investment, better and more tailored regulations might be needed in the sector to ensure rural communities are adequately served with water and sanitation services. Quite often, state capture, combined with weak and fragmented planning capacities, hampers water utilities from securing the revenue needed to undertake long-term investments. Cost recovery is difficult to achieve, given low pricing and high prevalence of non-revenue water, alongside the rising uncertainty associated with climate change. All these elements tend to increase the level of vulnerability encountered by water utilities, hence compromising their financial and technical viability and long-term economic and social sustainability. As a result, service costs remain high, and many existing water utilities rely on public funding not only to cover the costs of expanding service coverage but also to ensure adequate operations and maintenance. This alone is a concern, since the sector should be managed to ensure cost recovery through different pricing schemes that accommodate the vulnerability of some consumers, and to support agricultural and industrial development through investment strategies.

One additional advantage of more tailored regulation is improved governance mechanisms. Better governance could improve transparent processes needed to secure long-term investments in the water and sanitation sectors, characterised by considerable initial sunk costs, which are required to expand the network infrastructure. For example, clear procurement processes combined with random auditing, monitoring of the execution of the projects, and the implementation of anti-corruption plans could already help enhance credibility and performance of the sector. With transparent, accountable regulations, many industries could create jobs and help reduce poverty and inequality in ways that support structural transformation.

Improved regulation may also benefit from going beyond a single-sided approach, which looks at each sector (water and sanitation) individually, but rather from developing a more holistic and transversal nexus-based approach. Emerging water-energy-food (WEF) nexus paradigms, with extensions incorporating biodiversity (WEF-B), climate (WEF-C), and land-economy-climate linkages (WEF-LEC), all require an integrated approach to the governance and regulation of natural resources.

Rethinking water supply for the future

Third, Africa has sufficient physical water resources. From a technical perspective, the continent is physically water secure. There are more than 60 transboundary river basins in Africa, and two of them (the Nile and Congo) are among the largest in the world. However, from an economic standpoint, the continent remains water-insecure, as it lacks sufficient technical capacity and appropriate financial incentives to translate the physical water assets into sustained economic advantage. To date, most of the policy emphasis has been placed on surface water sources, despite the growing importance of groundwater in supporting key sectors such as agriculture and mining.

Technology can help to diversify water supply sources through improved groundwater resources management, enhance water use efficiency, and reduce water pollution. There is growing evidence of the role of improved irrigation technologies in enhancing water use efficiency, mainly in agriculture, in several regions around the globe, including Africa. Notwithstanding, in residential areas, greywater technologies are shown to play an important role in reducing overall water demand by extending the life cycle of water consumption. Nature-based solutions and the maturity of some wastewater treatment technologies could significantly reduce water pollution. Raising awareness of the potential of these technologies as well as their health-related implications could play a key role in influencing their uptake.

Regarding groundwater, more structured and aggressive measures might need to be envisioned. For example, national groundwater agencies, whose roles and missions are to carry out and provide accurate estimates of the volume of groundwater available per country/region, might need to be established. These institutions might be important in developing technical tools and operational measures to support groundwater management operations. The mission of those agencies can be extended to cover critical minerals, given the strong relationships between minerals and water resource management, particularly in addressing water pollution. This is intended to create a better link between investments in groundwater resources, improved regulation of water pollution, mineral resources extractions and management, and economic productivity. These will allow African policymakers to develop a holistic view of the extent to which groundwater might be affected by the extractive industry. Additionally, by doing so, countries could make informed decisions when negotiating contracts for the exploration, extraction, and commercialisation of critical minerals.

Monitoring and data

Fourth, data and monitoring play a critical role. The Africa Water Vision 2026 of "an Africa where there is an equitable and sustainable management of water resources for poverty alleviation, socio-economic development, regional cooperation and environment protection", is achievable if the appropriate action plans are mobilised and effectively implemented.

Another critical element in ensuring that these objectives are met within specific timelines is the use of data to monitor progress and provide real-time feedback for policy formulation. The computation and monitoring of clear indicators of progress might help to stay on track with the objectives set.

An African Continental Monitoring Program of Water and Sanitation could be established to support the collection, computation, and monitoring of African data on water, sanitation, and hygiene for several end users. Several water, sanitation, and hygiene (WASH) datasets could be collected and monitored to establish more direct links between investments in WASH services and improved socio-economic conditions, both in urban and rural areas.

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About the author: Prof. Djiby Thiam is a Full Professor in Economics at the University of Cape Town in South Africa. He has managed several projects and supervised many research initiatives both domestically and internationally. His work is related to water and environmental economics, applied economics, agricultural economics, and development economics. He has published research articles in academic journals, including Water Economics and Policy, Agricultural Economics, Environmental and Resource Economics, Environment and Development Economics, Journal of Agriculture and Applied Economics, among others. He is the Director of the Research Unit Water and Production Economics (WPE) at the University of Cape Town in South Africa, and an associate editor of the journal: Water Economics and Policy.