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The Africa Infrastructure Country Diagnostic (AICD) has produced continent-wide analysis of many aspects of Africa's infrastructure challenge. The main findings were synthesized in a flagship report titled Africa's Infrastructure: a time for transformation, published in November 2009. Meant for policy makers, that report necessarily focused on the high-level conclusions. It attracted widespread media coverage feeding directly into discussions at the 2009 African Union Commission Heads of State Summit on Infrastructure. Although the flagship report served a valuable role in highlighting the main findings of the project, it could not do full justice to the richness of the data collected and technical analysis undertaken. There was clearly a need to make this more detailed material available to a wider audience of infrastructure practitioners. Hence the idea of producing four technical monographs, such as this one, to provide detailed results on each of the major infrastructure sectors, information and communication technologies (ICT), power, transport, and water, as companions to the flagship report. These technical volumes are intended as reference books on each of the infrastructure sectors. They cover all aspects of the AICD project relevant to each sector, including sector performance, gaps in financing and efficiency, and estimates of the need for additional spending on investment, operations, and maintenance. Each volume also comes with a detailed data appendix, providing easy access to all the relevant infrastructure indicators at the country level, which is a resource in and of itself.

Market approaches to natural resource management have gained popularity over the last few decades. This study provides an encompassing analysis of the water market in the southern Murray‐Darling Basin (sMDB), Australia, in order to evaluate its performance and the importance of having various types of water rights traded in the market. We do so by investigating a set of market attributes, including price and price volatility, traded volume, number and the average size of transactions, and net import across a number of trading zones in the southern Murray‐Darling Basin. Our findings show that the price mechanism in the water market functions as intended, as the water prices signal the level of scarcity and reflect value that can be derived from water resources. Other factors like crop structure and institutional settings also play important roles in explaining differences in water market outcomes across the considered trading zones within the sMDB market. Overall, our findings document that water markets serve well their fundamental purpose in water resource management to allocate water toward its economically‐highest‐valued uses, and that various types of water rights traded in the market are meeting heterogenous needs of market participants in managing water supply and use. Key Points This study examines a set of key market attributes of the water market in the southern Murray‐Darling Basin (sMDB), Australia The sMDB water market is functioning well that market prices reflect the level of water scarcity and value derived from water resources Various types of water market products traded in the sMDB water market are meeting heterogenous needs of market participants

Water scarcity is a global concern that necessitates a global perspective, but it is also the product of multiple regional issues that require regional solutions. Water markets constitute a regionally applicable non-structural measure to counter water scarcity that has received the attention of academics and policy-makers, but there is no global view on their applicability. We present the global distribution of potential nations and states where water markets could be instituted in a legal sense, by investigating 296 water laws internationally, with special reference to a minimum set of key rules: legalization of water reallocation, the separation of water rights and landownership, and the modification of the cancellation rule for non-use. We also suggest two additional globally distributed prerequisites and policy implications: the predictability of the available water before irrigation periods and public control of groundwater pumping throughout its jurisdiction.

Environmental water markets have emerged as a tool for restoring flows in rivers across the world. Prior literature suggests that certain legal conditions are necessary for these markets to function. However, we find substantial market activity has occurred without these legal conditions through market and legal data collected in five core U.S. Colorado River basin states (Arizona, Colorado, New Mexico, Utah, and Wyoming) from 2014 to 2020. Ninety-five percent of the 446 water transactions sidestepped formal legal processes to transfer water rights to the environment. We also find that government regulatory and conservation programs, not private-sector investment, have driven most environmental water market activity. Government spending is the dominant funding source, with 90% of the$53 million spent coming from governments and 68% from the U.S. federal government alone. Finally, our analysis finds that current market activity would be insufficient to stave off future curtailment of critical water users under the Colorado River Compact and that $ 86–89 million annually in new investment is required to do so. In a basin experiencing a historic megadrought, our analysis suggests prioritizing such new investments over legal reform. Global implications are that such flow restoration is possible where legal regimes for environmental water markets do not already exist.

Environmental policy is often implemented using market instruments. In some cases, including carbon taxing, the links between financial products and the environmental objectives, are transparent. In other cases, including water markets, the links are less transparent. In Australia’s Murray–Darling Basin (MDB), financial water products are known as ‘entitlements’, and are similar to traditional financial products, such as shares. The Australian water market includes ‘Low Security’ entitlements, which are similar to ‘sub-prime’ mortgage bonds because they are unlikely to yield an amount equal to their financial worth. Nearly half the water purchased under the Murray–Darling Basin Plan for environmental purposes is ‘Low Security’. We suggest that the current portfolio of water held by the Australian Government for environmental purposes reflects the mortgage market in the lead-up to the global financial crisis. Banks assumed that the future value of the mortgage market would reflect past trends. Similarly, it is assumed that the future value of water products will reflect past trends, without considering climate change. Historic records of allocations to ‘Low Security’ entitlements in the MDB suggest that, in the context of climate change, the Basin Plan water portfolio may fall short of the target annual average yield of 2075 GL by 511 GL. We recommend adopting finance sector methods including ‘hedging’ ‘Low Security’ entitlements by purchasing an additional 322–2755 GL of ‘Low Security’, or 160–511 GL of ‘High Security’ entitlements. Securing reliable environmental water is a global problem. Finance economics present opportunities for increasing the reliability of environmental flows.

This report reviews China's water scarcity situation, assesses the policy and institutional requirements for addressing it, and recommends key areas for strengthening and reform. It is a synthesis of the main findings and recommendations from analytical work and case studies prepared under the World Bank Analytical and Advisory Assistance (AAA) program entitled 'Addressing China's Water Scarcity: from Analysis to Action.' These studies focus on several strategically important thematic areas for China where additional research was needed, as identified by the research team and advisory group based on a review of pressing issues. These areas are governance, water rights, pricing, ecological compensation, pollution control, and emergency response. The approach has been to evaluate Chinese and international experience to identify policy and institutional factors that have proven effective in promoting the adoption of water conservation and pollution reduction technologies. The research was based on literature reviews, qualitative and quantitative policy analyses, household surveys, field trips, and case studies to develop feasible recommendations for a plan of action based on realities on the ground.

Informal groundwater markets, where farmers with wells sell surplus water to neighbors, are a widespread adaptive response to water scarcity, particularly in South Asia where they are most prevalent and well-documented. This review (1990–2025) examines the evolving patterns of these markets by synthesizing global literature and viewing them through the lens of three transformative trends: energy transition (especially solar pumps), digital innovations (e.g., blockchain and IoT), and new policy pathways. We synthesize literature to evaluate market structures, contract forms, efficiency and equity outcomes, environmental impacts, and the influence of energy policies and digital tools. The review assesses whether these informal trades fulfill their promise of enhancing water productivity and equity or if new challenges are creating pitfalls. Key objectives include documenting historical evolution, analyzing market performance, discussing externalities like aquifer depletion, examining policy interactions, reviewing digital pilots, exploring social inclusion, comparing governance frameworks, identifying research gaps linked to SDGs, and proposing a policy roadmap for harnessing benefits while ensuring sustainability.

Water market development in the Yellow River Basin (YRB) unfolds new opportunities for alleviating water scarcity and improving water productivity. However, the further development of an effective water market in the basin faces challenges such as unclear water rights, regulatory deficiencies, market deficiencies, and insufficient compensation to third-parties, among others. Studying water market development in Western countries provides useful insights for addressing similar challenges, thus providing useful case studies despite the different cultural, economic, institutional, and political settings. This paper investigates water markets in the Murray–Darling Basin in Australia, the western United States, and Chile to synthesize cases of water market development that could potentially contribute to overcoming the challenges encountered in the YRB. After analyzing these cases, recommendations are made for enhancing the YRB’s water market development from the perspectives of water rights systems, as well as the roles of the government and market, legal system, and third-party effects.

Chile is positioned in the 20th rank of water availability per capita. Nonetheless, water security levels vary across the territory. Around 70% of the national population lives in arid and semiarid regions, where a persistent drought has been experienced over the last decade. This has led to water security problems including water shortages. The water allocation and trading system in Chile is based on a water use rights (WURs) market, with limited regulatory and supervisory mechanisms, where the volume to be granted as permanent and eventual WURs is calculated from statistical analyses of historical streamflow records if available, or from empirical estimations if they are not. This computation of WURs does not consider the nonstationarity of hydrological processes nor climatic projections. This study presents the first large sample diagnosis of water allocation system in Chile under climate change scenarios. This is based on novel anthropic intervention indices (IAI), which were computed as the ratio between the total granted water volume to the water availability within 87 basins in north-central and southern Chile (30°S–42°S). The IAI were evaluated for the historical period (1979–2019) and under modeled-based climatic projections (2055–2080). According to these IAI levels, to date, there are 20 out of 87 overallocated basins, which under the assumption that no further WURs will be granted in the future, increases up to 25 basins for the 2055–2080 period. The results show that, to date most of north-central Chilean catchments already have a large anthropic intervention degree, and the increases for the future period occurs mostly in the southern region of the country (approximately 38°S), which has been considered as possible source of water for large water transfer projects (i.e., water roads). These indices and diagnosis are proposed as a tool to help policy makers to address water scarcity under climate change.

South Asia is a hotspot for populations and economies adversely impacted by poor water security. This is evident in the case of Nepal where it has been estimated that 20% of households have no access to a domestic water source and two-thirds of the urban households live with inadequate water supply. Therefore, many depend on private solutions, such as private wells and purchasing water from informal water markets, to meet household water needs. Within this context, this paper examines whether private water vendors provide equitable access to both poor and wealthy households, whether they practice discriminatory pricing and whether poor households face a greater financial burden in meeting their household water needs. The analysis uses primary data collected from a 1,500-household survey conducted in 2014 and uses regression analyses to derive the results. The results reveal patterns of inequity in the private water market, but seemingly not purely due to an inherent bias against poorer households. Regardless, the market does not serve the poor adequately and given the lack of alternatives that poor households have, it points to an urgent need for the government to step in to counterbalance the deficiencies of the market.