EUROPEAN COMMUNITY CONTRIBUTION AGREEMENT

WITH AN INTERNATIONAL ORGANISATION

EUROPEAID / DCI-ENV / 2011 / 260-062

OECD - UNECE ANNUAL NARRATIVE REPORT

(June 2015-May 2016)

January 2017

Table of contents

1. Background of the project ...................................................................................... 3 2. Summary of progress during the review period of June 2015-May 2016 ............. 4 3. Detailed report on the implementation of the Project during the review period of

June 2015-May 2016 .................................................................................................. 6

3.1 Work package 1: Promoting the political commitment in EECCA countries at

national level towards action and innovation-oriented partnership ....................... 6 3.2 Work package 2: Development of a robust analytical basis to substantiate

policy dialogues; elaboration of the policy packages ............................................ 7 3.3 Work package 3 (Benchmarking and exchange of experiences) ................... 20

The second benchmarking report “Implementation of the Basin Management Principle

in Eastern Europe, the Caucasus and Central Asia” was released in May 2016, written

by Peep Mardiste and UNECE consultant Vahagn Tonoyan. While the first report

from 2014 gave an overview of implementation of all key IWRM principles in the

region, the 2016 benchmarking report concentrated on the key principle of IWRM –

adoption and implementation of the basin principle. The Study was released in

English and Russian. .................................................................................................... 20 3.4 Work package 4 (Dissemination of project information and stakeholder

involvement) ........................................................................................................ 22

4. Difficulties encountered and measures taken to overcome problems .................. 24 5. Changes introduced in the project implementation ............................................. 24

6. Achievements and results .................................................................................... 24

1. Background of the project

The project “Support to the EU Water Initiative in Eastern Europe, the Caucasus and Central

Asia (EECCA)” aimed to assist the countries in the region in adopting a more integrated

approach to water management, addressing the current fragmentation of water resource

management and improving multi-stakeholder participation. It aimed to identify and remove

the key hurdles that impede the deployment of integrated water resources management

(IWRM), while reflecting countries' level of socio-economic development. The project also

contributed to achieving progress towards water-related Millennium Development Goals

(MDGs) in the EECCA countries as well as specific targets on water management set up in

the EU policies and programmes, including the EU Water Policy, the EU Neighbourhood

Policy, the EU Eastern Partnership and the EU Central Asia Strategy programmes. The

project was a regional component of the European Union’s Water Initiative (EUWI)1 focused

on EECCA and built upon outcomes and the political momentum initiated by the OECD and

UNECE under the EU-funded contract DCI-ENV/2008/149-674, carried out in 2008-2012.

That project supported mapping of the situation and initiation of National Policy Dialogues on

water in eight EECCA countries. Follow-up in the EU Neighbourhood region will be

guaranteed through EUWI+ project, starting in September 2016.

The activities carried out under the Project supported the National Policy Dialogues (NPDs)

on integrated water resources management (IWRM) and water supply and sanitation (WSS) in

ten EECCA countries: Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, the Republic

of Moldova, Russia, Tajikistan, Turkmenistan and Ukraine. The project also aimed to launch

and implement National Policy Dialogues in Belarus and Uzbekistan. The NPDs helped

elaborate policy packages (government strategies, laws, regulations), as well as monitor

implementation of the adopted policy packages; the latter was essential, as implementation

remains a major bottleneck in EECCA countries. The NPDs also served as national

mechanisms for coordination of the development aid and technical assistance in the water

sector. They contributed to a more efficient use of the EU and other donors’ technical co-

operation in the region.

Another specific objective of the project was to support the organisation of annual meetings

of the EUWI EECCA Working Group, which serves as a platform for regional dissemination

and sharing of lessons learned and experience gathered during the implementation of the

Project.

The implementation of the project was facilitated by the Organisation for Economic Co-

operation and Development (OECD) and the United Nations Economic Commission for

Europe (UNECE). The OECD was the strategic partner for economic and financial aspects of

water resources management, including water supply and sanitation. The UNECE was the

strategic partner for integrated water resources management.

1 The European Union’s Water Initiative (EUWI) is a political initiative which seeks to assist

partner countries in the development and implementation of policies, strategies and priorities

for the water and sanitation sector which donors could align with and support. The Initiative

ensures that existing resources are more effectively utilised and new resources are attracted in

the sector to meet the specific requirements of individual developing countries and river basin

organisations.

2. Summary of progress during the review period of June 2015-May

2016

Overall, substantial progress was made during the reporting period of 1 June 2015 - 31 May

2016 on all project elements resulting in important outputs and progress in reforming water

policies in individual countries and at the regional level. The key achievements of the

reporting period included:

National Policy Dialogues (NPDs) were active in ten countries2. As part of the project

12 high-level NPD Steering Committee meetings were organised in 7 countries (see

Section 3.1);

A regional EUWI EECCA Working Group meeting, organised on 12-13 May 2016 in

Paris to discuss results of the project and launch plans of the EUWI+ project;

New Water Code of Turkmenistan was passed to Parliament (was finally adopted after

completion of the project, in October 2016);

Two new by-laws to the national water law were drafted in Georgia;

National targets under the Protocol on Water and Health were drafted in Azerbaijan

and Georgia;

National Policy Dialogue was used as platform to discuss transboundary cooperation

and/or treaties between following countries: Georgia-Armenia, Georgia-Azerbaijan,

Kazakhstan-Russia, Kazakhstan-Kyrgyzstan;

The development of a policy package including methodological guidelines for setting

fee rates for the use of surface water resources and water bodies in the Kyrgyz

Republic, as well as draft Government Resolution on approval of the methodology.

A number of reports and other materials on project-related activities were prepared

and used to communicate policy-relevant results of, and lessons learnt from, this

Project and disseminate them in EECCA countries (see Sections 3.3 and 3.4).

In addition to the analytical work and support to the NPDs, the OECD and UNECE have

organised, and contributed to, a number of meetings during the reporting period, highlighting

findings and achievements of the current Project:

Plenary discussion and side event at the 7th Meeting of Parties (MOP) of the Water

Convention (17-18 November 2015, Budapest);

Contribution to the World Water Week 2016 (28 August 2016, Stockholm);

Training on implementation of modern irrigation technologies organised in

Kyrgyzstan (18 March 2016, Bishkek).

A Communication Strategy of the Project was implemented through a number of targeted

priority actions. These included:

Regular meetings of the Steering groups in the countries. Relevant representatives of

the target groups were systematically invited, in particular: national authorities in

charge of water-related activities; permanent delegations of the European

Commission to EECCA countries; and permanent representatives of other donors and

IOs active on water issues.

2 These are: Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan,

Turkmenistan and Ukraine; and at a sub-sovereign level in Russia (Republic of Buryatia, Lake

Baikal basin).

A continuous update of the EUWI EECCA web site

(http://www.oecd.org/env/outreach/partnership-eu-water-initiative-euwi.htm),

The updating of the brochure on the achievements of the EUWI in EECCA in 2006-

2016

(https://issuu.com/oecd.publishing/docs/euwi_report_layout_english_june_01.)

Dissemination of the results of the Project during a number of events where the

OECD and UNECE participated.

3. Detailed report on the implementation of the Project during the

review period of June 2015-May 2016

3.1 Work package 1: Promoting the political commitment in EECCA countries

at national level towards action and innovation-oriented partnership

Work package 1 aimed at strengthening the political commitment of governments in EECCA

countries to water sector reforms through high-level policy and expert dialogues on water

policies in individual countries. During the reporting period the implementation of this

objective was supported by the following activities:

Continuous support to high-level policy dialogues through organisation of twelve

meetings of the National Policy Dialogues (NPD) Steering Committees in eight

countries:

o 13 November 2015, Moldova: 22nd NPD Steering Committee meeting

o 30 November 2015, Kyrgyzstan: 13th NPD Steering Committee meeting

o 2 December 2015, Kazakhstan: 3rd NPD Steering Committee working

meeting

o 3 December 2015, Tajikistan: 9th NPD Steering Committee meeting

o 14 December 2015, Armenia: 14th NPD Steering Committee meeting

o 25 February 2016, Azerbaijan: 5th NPD Steering Committee meeting

o 5 April 2016, Georgia: 4th NPD Steering Committee meeting

o 12 April 2016, Tajikistan: 10th NPD Steering Committee meeting

o 15 April 2016, Kyrgyzstan: 14th NPD Steering Committee meeting

o 26 April 2016, Armenia: 15th NPD Steering Committee meeting

o 26 May 2016, Moldova: 23rd NPD Steering Committee meeting

o 30-31 May 2016, Kazakhstan: 3rd NPD Steering Committee meeting

Note: Support to the NPD in Moldova was provided by assisting the Ministry of Environment

in drafting new regulation on the NPD Coordination (Steering) Committee (updated

composition and mandate). The regulation was approved by respective ministerial ordinance

issued in March 2016.

Organisation of expert meetings on selected priority topics:

Expert workshop in Bishkek on 14 April, 2016 on assisting Kyrgyzstan in developing

methodologies for the introduction of new economic instruments for water resource

management.

Reaching out to senior policy makers to build support to the NPDs and EUWI

EECCA activities3, including meetings with:

o Minister of Foreign Affairs, Turkmenistan (Mr. Rashid Meredov)

o Minister of Energy and Water, Tajikistan (Mr. Usmonali Usmanzoda)

o Minister of Environment, Moldova (Mr Munteanu)

o Minister of Agriculture and Water Resources, Turkmenistan (Mr. Nursahet

Sapardurdyyev)

o Acting Minister of Environment, Ukraine (Mr. Sergey Kurykin)

o Chairman of the State Committee on Water Systems of the Ministry of

Agriculture, Armenia (Mr. Aram Haroutunyan)

o First Deputy Minister of Environment Protection and Natural Resources,

Georgia (Mr. Teimuraz Murgulia)

o First Deputy Minister of Energy and Water, Tajikistan (Mr. Sulton

Rahimzoda) o Deputy Minister of Economy, responsible for the energy sector, Kyrgyzstan (Mr.

Dzunushaliev)

o Deputy Minister of Agriculture, Kazakhstan (Mr. Yerlan Nysanbaev)

o Deputy Minister of Environment, Moldova (Mr. Andrian Delinschi)

o Deputy Minister of Nature Protection, Armenia (Mr. Khachik Hakobyan)

o Director of State Sanitary and Epidemiological Surveillance Service of the

Ministry of Health, Tajikistan (Mr. Kholmakhmad Nazarov)

o Deputy chair of the Water Resources Committee, Kazakhstan (Mr. Bekniyaz)

Detailed country specific activities carried out under this Work package are presented under

Work package 2 (Section 3.2).

3.2 Work package 2: Development of a robust analytical basis to substantiate

policy dialogues; elaboration of the policy packages

Work package 2 aimed at supporting analytical work to prepare policy packages for the

NPDs. The activities were carried out under three actions:

Action 2.1: preparation of the policy packages on water policy reforms (IWRM and

WSS);

Action 2.2: strengthening the use of economic instruments in water policies;

Action 2.3: promoting sound business models and realistic financial plans for water

supply and sanitation policies.

An overview of activities for each country under the Work Packages 1 and 2 are presented

below.

3 It is especially important as neither OECD nor UNECE have offices in the countries and have limited

opportunities to meet senior officials regularly.

Armenia (AM)4

The NPD process was re-started in autumn of 2015 after the Ministry of Nature Protection

had lost interest in NPD process in early 2015 due to the changes in the management of the

Ministry. In summer 2015, the State Committee of Water Systems of the Ministry of

Agriculture indicated its readiness to lead the NPD process and managed to get all

participating ministries to re-nominate their members. A Steering Committee meeting was

organised on 14 December 2015 after a year-long pause. A subsequent NPD Steering

Committee meeting took place on 26 April 2016.

During the reporting period, the UNECE concentrated its support in Armenia to the

implementation of the UNECE Protocol on Water and Health. Back in December 2014

national targets were set and an action plan for achieving them was adopted. Constant

discussion was maintained with different ministries to push for formal adoption of targets and

for ratification of the Protocol. In January 2016, the Ministry of Nature Protection failed with

a formal request to the Ministry of Foreign Affairs to speed up the process. Unfortunately, it

did not result in action by the end of the reporting period. Formal approval of the drafted

targets and the ratification of the Protocol would help in coordinating and monitoring the

activities of different national agencies providing access to quality drinking water and

reducing water-borne diseases.

As announced at the 26 April 2016 NPD Steering Committee, an institutional reform in the

water sector in Armenia will reach a new milestone in 2017 with the enactment of provisions

on drinking water. As a result, a single water service operator will be chosen to supply

drinking water for the entire country5, instead of the five separate companies operating

previously. Importantly, the new operator will be required to provide water to some 500

communities that are not currently served by operators. The provision of wastewater services

in some settlements might also be included in the contract of the future service provider, a

requirement that does not exist in current contracts with service providers. Although the

coverage with improved sanitation for urban dwellers is 96%, the proper treatment of

wastewater is largely absent in Armenia.

The study on environmental and economic value of water was launched by the OECD as per

the ad-hoc request of the Armenian water authorities. Managing water demand and efficient

allocation of water resources across competing uses is a pre-condition for economic growth,

and assessment of the use and non-use values of water resources is crucial to support the

revision of current water prices. Water has environmental and economic value when used and

even when not used – this principle is clearly stated in the Water Code of Armenia, but at the

moment this principle is not fully implemented due to insufficient knowledge on

environmental and economic value of water. First results of the study were presented at the

NPD meeting in spring 2016. The results were still preliminary, as some uncertainties still

held for some of the data used in the calculations. Nevertheless, these preliminary results

already provided e.g. good indications of the value of water in agriculture. This study was

completed in June 2016.

4 See also http://www.unece.org/env/water/npd/countrydialogues/am

5 A 15-year lease contract with VEOLIA was signed in November 2016. The operator was selected

through a competitive international tender.

Table 1. Armenia – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Ratification of the

Protocol on Water

and Health

Negotiations with relevant

ministries to push for the

ratification.

Decision of the 14.12.2015

Steering Committee “The

Steering Committee stresses

the importance to continuing

the works towards ratification

of the Protocol in Armenia, as

well as formal adoption of the

targets either through

Government Resolution or

Government of Armenia

Protocol Session Resolution.“

Support to the

reform of economic

instruments for

water resources

management

Assessment of the use and

non-use values of water

resources to support the

revision of current water

prices

Results of the study are

currently being considered by

the State Committee of Water

Systems to revise the bulk

water tariffs for the irrigation

sector of Armenia (specifically

in the Ararat valley).

The activities in Armenia over the reporting period contributed to Action 2.1 (preparation of

the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies).

The implementation of the Protocol on Water and Health contributes to achieving water-

related MDGs (and future SDGs) in Armenia as one of the Overall Objectives of the present

project (see attached Logical Framework of the Project). UNECE started a project “Self-

Assessment of Equitable Access to Water and Sanitation in Armenia” which will help

Armenia to identify parts of the society with poor access to good quality water services,

enabling to design actions to improve their quality of life. The project worplan was introduced

at the 15th Steering Committee meeting on 26 April 2016.

Azerbaijan (AZ)6

In Azerbaijan, major work started on the Protocol on Water and Health. Although Azerbaijan

ratified the Protocol in 2000, it had failed to design mandatory national targets and target

dates under the Protocol. UNECE provided its technical know-how and financed work of

national expert groups which drafted national targets in period of August 2015 – March 2016.

Draft targets were presented at the 5th NPD Steering Committee meeting on 25 February

2016. Targets are expected to be formally adopted in first half of 2017 by joint order of

ministers of environment and health. In close coordination with the drafting of national

targets, a project “Self-Assessment of Equitable Access to Water and Sanitation in

Azerbaijan” was launched. Its aim is to identify groups that due to social, ethnical or

geographical peculiarities have poor access to drinking water and/or sanitation. The

assessment exercise is financed by France.

One of the key priorities discussed at the 25 February 2016 NPD Steering Committee was the

endorsement of the national water strategy by the Government, and addressing the comments

6 See also http://www.unece.org/env/water/npd/countrydialogues/az

received from different ministries and agencies. The Government is expected to endorse the

document in the coming months. The long-debated strategy, once endorsed, will lay the

ground for the adoption of the key principles of integrated water resources management

(IWRM) and initiate the process of relevant changes in national legislation, bringing it into

line with the European Union Water Framework Directive. The OECD and UNECE

moderated the interministerial discussion on this issue and provided the ad hoc support, in

close cooperation with the EU-funded EPIRB project.

As Azerbaijan is a part of the Eastern Partnership region, the EU strongly supports

harmonization of the water legislation of Azerbaijan with the EU water acquis. Many of the

concepts of the WFD including RBMP can be applied in Azerbaijan through the

implementation of the national water strategy. The Ministry of Ecology initiated development

of an action programme for implementation of the water strategy. It is expected that the new

EUWI+ project (2016-2020) will support implementation of the water strategy.

The need to reach bilateral agreement with neighbouring Georgia on use of transboundary

Kura resources was once again discussed at the 25 February 2016 NPD Steering Committee

meeting. Based on agreement between the two deputy ministers of environment, countries

approached donors to have a study done. OSCE is funding the study which was started in

spring 2016.

Table 2. Azerbaijan – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Drafting of the

national targets

under the Protocol

on Water and Health

Five national short-term

experts hired to prepare first

draft of the national targets

Draft targets presented and

discussed at the NPD

Steering Committee meeting

of 25.02.2016

Draft national targets and

target dates (in Russian and

Azerbaijani)

Support to the

development and

endorsement of the

national water

strategy by the

Government

Ad hoc support provided to

the Ministry of Ecology to

finalise the national water

strategy

• Draft strategy

document (input to final

version coordinated by

EPIRB project)

The activities in Azerbaijan over the reporting period contributed to Action 2.1 (preparation

of the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies).

The assessments done in the transboundary basin further contributed to the implementation of

Water Framework Directive (WFD) principles in Azerbaijan (specifically, of Article 9 of the

Water Framework Directive which requires that also environmental and resource costs are

taken into account in prices for water services) as one of the Overall Objectives of the present

project on supporting the implementation of the EUWI in EECCA.

Belarus (BE)

During the previous reporting period, a joint OECD and UNECE mission was organised in

March 2015 to assist in launching the NPD process. It turned out however that the leading

ministries (of environment and economy) chose to wait until the start of new, EUWI+ project

for 2016-2020 for starting the fully-fledged NPD process with establishment of an NPD

Steering Committee and setting a national workplan. Thus no substantial activities took place

during the reporting period.

Georgia (GE)7

Development of modern water legislation formed the core part of UNECE support to Georgia

during the reporting period. During previous reporting periods, a group of national experts

had prepared a new water law and two bylaws. During the curent reporting period, two further

bylaws were prepared by local experts – on water protection zones and on water quality

standards.

To further the transboundary water cooperation with neighbouring countries, a working

meeting was organised by UNECE in Tbilisi on 4 April 2016 for representatives of Armenia

and Georgia. Results of the past joint projects were reported and options for initiating new

project on Debed/Khrami transboundary basin were discussed. UNDP and OSCE also

attended the working meetings as both have history of supporting transboundary water

projects between the two countries.

The Ministry of Environment and Natural Resources of Georgia, the EPIRB project and the

OECD conducted a study to review economic instruments for water resources management

and to explore ways to strengthen their use to manage the demand for water, promote low cost

options, and raise additional revenues for water policies.

Georgia is one of the Eastern Neighbourhood countries which signed the Association

Agreement with the EU and therefore the country made commitments to approximate to the

EU water acquis. Compliance with the EU’s Water Framework Directive (WFD) requires the

use of economic instruments, including water pricing, to cover the costs of water services.

These instruments have a two-fold purpose: providing incentives for sustainable water use by

the various user groups (including households, farmers, businesses, hydropower plants), and

furnishing financial resources needed for the management of national water resources and the

supply of water services to users. Both of these purposes are highly relevant to Georgia, and

in most cases the economic instrument will have a dual impact. However, it is arguable that

the financial motive is more important in present circumstances. The study considered

different options for the reform of economic instruments in Georgia. More specifically,

implementation of recommendations on water abstraction charges reform and development of

a new methodology for setting the abstraction charges have been requested as a follow up

action.

7 See also http://www.unece.org/env/water/npd/countrydialogues/ge

Table 3. Georgia – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Harmonization of

the national water

legislation with the

EU legislation

National experts hired to

draft two bylaws

Two bylaws drafted and

presented at 05.04.2016

NPD Steering Committee

Development of

bilateral cooperation

on transboundary

basins

Working meeting between

Armenia and Georgia was

organised by UNECE in

Tbilisi on 04.04.2016.

Agreement of

representatives of Armenia

and Georgia to continue the

dialogue

Support to the

reform of economic

instruments for

water resources

management

Review of EIs for WRM

conducted by a joint team of

the EPIRB project and

OECD

Review of economic

instruments for water

resources management with

recommendations on their

reform

The activities in Georgia over the reporting period contributed to Action 2.1 (preparation of

the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies).

The assessments done in the transboundary basin further contribute to the implementation of

Water Framework Directive (WFD) principles in Georgia (specifically, of Article 9 of the

Water Framework Directive which requires that also environmental and resource costs are

taken into account in prices for water services) as one of the Overall Objectives of the present.

Kazakhstan (KZ)

In Kazakhstan, both the OECD and UNECE have been successful in raising additional

funding for NPD process which will enable activities to continue after end of the current

project period in May 2016. Therefore, only some of the meeting and mission costs were

funded through the current grant during the reporting period. The OECD has mobilised co-

financing through grant agreements with Norway and Switzerland, as well as with the

Government of Kazakhstan (under the OECD Country Programme for Kazakhstan),and

UNECE is the implementing partner along with UNDP for the project on green economy and

water resources, financed by EU Delegation in Astana.

In 2013-2014, a series of awareness raising activities were organised in Kazakhstan for

different ministries and other stakeholders on the advantages of becoming Party to the

UNECE-WHO/Europe Protocol on Water and Health. As result, a decision was taken at the

second EUWI NPD Steering Committee meeting in 2014 to launch the ratification process.

According to the governmental legislative workplan, ratification documents are to be finalised

by the end of 2016. In late 2015, the process of setting national targets under the Protocol

were started through the NPD process and draft targets were discussed at the NPD Steering

Committee meeting 30-31 May 2016. It is expected that ratification of the Protocol and

adoption of national targets will take place in 2017.

In October 2015, a Kazakh-Russian bilateral committee on transboundary waters decided to

launch a joint assessment on Ural river and Kigac tributary of the Volga river. UNECE

supports the work of a bilateral group of experts. Regular working meetings were held and

preliminary results were discussed at the May 2016 NPD Steering Committee meeting. It is

expected that as a result, a new bilateral Protocol on use of Kigac river water resources will be

signed in 2017. For Ural, a joint strategy for use of resources is being prepared, featuring also

climate change issues.

In December, 2015, two new activities were launched aimed at: (a) strengthening the role of

Multi-Purpose Water Infrastructure (MPWI) in Kazakhstan in transition to the green economy

model, inclusive and sustainable economic growth, and achieving greater levels of water,

food and energy security; and (b) improving mechanisms and instruments of state support to

agriculture, rural development and a water intensive industry impacting the water resources

and water sector in Kazakhstan. The activities have been implemented through the NPD with

support from the EU, Norway and the Government of Kazakhstan (under the OECD country

programme for Kazakhstan).

Table 4. Kazakhstan – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Ratification of the

Protocol on Water

and Health

Regular meetings with key

ministries to ensure smooth

ratification process when

formal inter-ministerial

process will be launched

National targets drafted

Draft version of national

targets prepared (to be

finalised in early 2017)

The work on

strengthening the

role of Multi-

Purpose Water

Infrastructure

(MPWI) in

Kazakhstan in

transition to the

green economy

model, inclusive and

sustainable

economic growth,

and achieving

greater levels of

water, food and

energy security

A pilot study on Shardara

MPWI on syr-Darya river (in

South Kazakhstan)

supported by the

development of a computer

based model. Key findings

and preliminary

recommendations were

discussed at the NPD

Steering Committee meeting

in May 2016.

Interim Report on

Strengthening the Role of

Multi-Purpose Water

Infrastructure in

Kazakhstan

Review and

assessment of

mechanisms and

instruments of state

support to

agriculture, rural

development and a

water intensive

industry impacting

water resources and

the water sector in

Kazakhstan.

Key findings of the review

and assessment and

preliminary

recommendations were

discussed at the NPD

Steering Committee meeting

in May 2016.

Interim report on Review

and Assessment of

Mechanisms and

Instruments of State

Support to Agriculture,

Rural Development and a

Water Intensive Industry

Impacting the Water Sector

in Kazakhstan

The activities in Kazakhstan over the reporting period contributed to Action 2.1 (preparation

of the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies) with focus on subsidies (state support).

The implementation of the Protocol on Water and Health, the work on MPWI and previous

work on sustainable business models for WSS, contributed to achieving water and nexus

related SDGs (previously MDGs) in Kazakhstan (specifically, the targets on WSS and water,

food and energy security) as one of the Overall Objectives of the present project (see attached

Logical Framework of the Project’ on supporting the implementation of the EUWI in

EECCA).

Kyrgyz Republic (KG)8

At the March 2015 NPD Steering Committee meeting, a study on the most suitable water-

saving technologies for the Kyrgyz irrigation sector was presented by UNECE consultants. As

a follow-up activity, specific recommendations on the use of efficient irrigation techniques

were presented during the November 2015 NPD Steering Committee meeting. In addition, a

full-day training was organised in Bishkek on 18 March 2016 to present the finding of the

studies. Both guiding documents are used by a special unit created for modern irrigation

technologies under the Ministry of Agriculture. Proposed wider use of sprinkler or drip

irrigation in place of surface irrigation could boost agricultural productivity in Kyrgyzstan —

where the agriculture sector consumes some 90 per cent of available water resources — while

significantly reducing water use. The two studies also recommended increasing the share of

crops that need less water and produce higher economic value, such as fruits, vegetables and

berries.

Back in 2013, the national targets in context of the UNECE-WHO/Europe Protocol on Water

and Health were adopted. Funded by Finland, a project started in mid-2015 to update the

targets and to implement few. The project was introduced at the 30 November 2015 NPD

Steering Committee meeting and interim results were reported at the 15 April 2016 Steering

Committee meeting. Planned implementation of selected targets in 2017 will help to develop

policies and actions to reduce harm caused by water-borne diseases, in line with the SDG

goals.

Key priorities of the OECD in Kyrgyzstan during the reporting period were to support:

Improving water use efficiency through strengthening economic incentives by

introducing fee for use of water resources and water bodies; and

Achieving greater levels of water security, especially in rural areas, while following

the nexus approach.

At the NPD meeting in April 2016, draft methodological guidelines for setting fee rates for

the use of surface water resources and water bodies in the Kyrgyz Republic were presented,

discussed and generally supported. The follow up work (preparing submission of the

methodology to the government for eventual approval, as well as proposals on eliminating

inconsistencies in water legislation revealed through the study) is implemented by the key

beneficiary of this activity – Department of Water Resources and Melioration under the

Ministry of Agriculture and Melioration.

At the same NPD meeting, a new project was presented aimed at supporting the government

of Kyrgyzstan in establishing national definitions and indicators of the water, food and energy

security in KR. This work was co-funded by the EU under this contribution agreement and

has been implemented through the NPD. It will be finalised with financial support from

Finland (FinWater WEI-II programme) and the EU (WECOOP-II project providing support to

NPDs in Central Asia).

8 See also http://www.unece.org/env/water/npd/countrydialogues/kg

It is important to note that the work funded by the EU under this Project not only generated

the new demand but also helped to mobilise funding from Finland, an EU member-state, to

support the follow up projects thus contributing to the NPD.

Table 5. Kyrgyzstan – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Increasing water

saving in irrigation

sector

National expert drafted a

study on application of

modern irrigation

technologies in new

agricultural lands in hilly

landscapes

Full-day training on

implementation of modern

irrigation technologies organised in Bishkek on 18

March 2016

Feedback collected from

other stakeholders at NPD

Steering Committee meeting

Study “Application of the

modern irrigation

technologies in

Kyrgyzstan” prepared (in

Russian) and adopted by

NPD Steering Committee

on 30 November 20159

Reforming

Economic

Instruments for

Water Resources

Management in

Kyrgyzstan

Elaboration of a policy

package including

methodological guidelines

for setting fee rates for the

use of surface water

resources and water bodies

in the Kyrgyz Republic, as

well as draft Government

Resolution on approval of

the methodology. The

package was discussed at,

and generally supported by,

the NPD SC meeting in

April 2016.

Policy package including

methodological guidelines

for setting fee rates for the

use of surface water

resources and water bodies

in the Kyrgyz Republic, as

well as draft Government

Resolution on approval of

the methodology.

Support to achieving

greater levels of

water security,

especially in rural

areas, while

following the nexus

approach

A new project aimed at

supporting the government

of Kyrgyzstan in establishing

national definitions and

indicators of the water, food

and energy security was

launched at the NPD SC

meeting in April 2016.

Draft proposal on key

components and elements

of water, food and energy

security (sent out for

comments to relevant line

ministries and agencies in

Kyrgyzstan)

The activities in Kyrgyzstan over the reporting period contributed to Action 2.1 (preparation

of the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies).

9

http://www.unece.org/index.php?id=44699

The implementation of the Action Plan and of the follow up OECD study further contribute to

the implementation of Water Framework Directive (WFD) principles in Kyrgyzstan

(specifically, of Article 9 of the Water Framework Directive which requires that also

environmental and resource costs are taken into account in prices for water services) as one of

the Overall Objectives of the present project (see attached Logical Framework of the Project

on supporting the implementation of the EUWI in EECCA). The work on water security

following the nexus approach contributes to achieving water- and nexus-related SDGs

(previously, MDGs) in Kyrgyzstan (specifically, the targets on WSS, water, food and energy

security) which was another key Overall Objectives of the project.

Republic of Moldova (MD)

10

During the reporting period the National Policy Dialogue in Moldova focused on: i) the

implementation of actions to achieve national water and health targets; and ii) the

identification of ways to improve domestic financial support mechanisms for WSS and

establishing a sound economic regulatory system for WSS in Moldova. The OECD and

UNECE also jointly contributed to establishing new norms for design and construction of

small-scale WSS systems (with installed capacity below 200 m3/day). This work is forecast

for continuation and completion under the EUWI Plus project.

Within the first element, which has been financially supported by the Swiss Agency for

Development and Cooperation (SDC), the national programme for implementation of the

Protocol in 2016-2025 with clear deadlines and budget was finalised.11

The Programme was

discussed among stakeholders on 13 November 2015 and 26 May 2016 NPD Steering

Committee meetings. It’s the first such elaborated programme for the implementation of the

Protocol on the EECCA region and has already attracted interest in other countries.

Under the second element, the OECD completed a study that analysed existing domestic

financial support mechanisms for WSS and identified ways of streamlining them and

increasing their efficiency and cost-effectiveness. The results of this work were discussed at

the NPD Coordination Council meeting in May 2015 during which the main policy

recommendations of the study were discussed and endorsed.

This activity has generated demand with the Ministry of Environment for a follow up work on

establishing a sound system of economic regulation for WSS and new (revised) norms for

small-scale WSS systems. A request was sent to the OECD indicating that it was a topical

political issue (see the letter in the Annex to this report) and projects were launched

accordingly. Over the reporting period, an interim report on the economic regulatory system

in Moldova was produced and its key findings and preliminary recommendations were

discussed and generally supported at the NPD SC meeting in May 2016. This work was

discussed at the recent NPD CC meeting in November 2016 and is expected to be finalised, as

part of the work programme under the EUWI+ project for Eastern Partnership (EaP)

countries.

10

See also http://www.unece.org/env/water/npd/countrydialogues/md 11

See

http://www.unece.org/fileadmin/DAM/env/documents/2016/wat/Moldova_National_Forum_

Water_for_Health/Protocol_rus_Web.pdf (in Russian)

Table 6. Moldova – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Implementation of

the Protocol on

Water and Health

Organization of stakeholder

discussion at NPD Steering

Committee meeting

(documents were drafted by

national experts with

financing provided by

Switzerland)

Finalised national

programme for

implementation of the

Protocol on Water and

Health in 2016-2025

Support to the

Government of

Moldova in

establishing a sound

economic regulatory

system for WSS

Key findings and

preliminary

recommendations were

discussed and generally

supported at the NPD SC

meeting in May 2016.

Support to the Government

of Moldova in establishing

a sound economic

regulatory system for WSS

The activities in Moldova over the reporting period contributed to Action 2.1 (preparation of

the policy packages on water policy reforms) and Action 2.2 (strengthening the use of

economic instruments in water policies).

The implementation of the Protocol on Water and Health, the proposed improvement in

domestic financial support mechanisms in WSS and the follow up work on establishing a

sound economic regulatory system for WSS and on new norms for small-scale WSS systems,

contribute to achieving water-related SDGs (previously MDGs) in Moldova (specifically, the

target on WSS), as well the internationally (UN) adopted “Equitable Access to Water for All”

objective in a more cost-effective way, particularly in rural areas. Furthermore, improved

domestic financial support mechanisms and a sound economic regulatory system for WSS

will contribute not only to financial sustainability of WSS but also to improving incentives for

the sustainable use of water resources thus helping to achieve the environmental objectives

under the Water Framework Directive.

Both achieving water-related SDGs and implementation of the EU water policy principles

(such as the WFD) were the two Overall Objectives of the project (see attached Logical

Framework of the Project on supporting the implementation of the EUWI in EECCA).

Russian Federation (RU)

Work on improving economic instruments for water resources management in the Lake

Baikal basin, the Republic of Buryatia was completed in 2015 and reported on previously. In

the reporting period, the OECD focused on publishing results of the study in the OECD Water

Study series (for reference to the report see section 3.4) and disseminating project results in

the EECCA region.

Table 7. Russia – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Dissemination of

results of the study

on the use of

Economic

Instruments for

WRM in the

Republic of Buryatia

(Lake Baikal basin)

Publication and

dissemination of results of

the study.

Final report published in the

OECD Water Study series

The activities in Buryatia (Russian Federation) implemented under the project contributed

to Action 2.1 (preparation of the policy packages on water policy reforms) and Action 2.2

(strengthening the use of economic instruments in water policies).

The implementation of the proposed policy recommendations contributes to the

implementation of Water Framework Directive (WFD) principles in Russia (specifically, of

Article 9 of the Water Framework Directive which requires that also environmental and

resource costs are taken into account in prices for water services). Furthermore, they

contribute also to achieving water-related SDGs (specifically, the target on WSS), as well

the internationally (UN) adopted “Equitable Access to Water for All” objective in Buryatia,

as they envisage a shift to a sound tariff policy in WSS and in irrigation.

Both achieving water-related SDGs (previously MDGs) and implementation of the EU

water policy principles (such as the WFD) were Overall Objectives of the project.

Tajikistan (TJ)12

A key achievement of the NPD process over last years was its contribution to the

development of the Water Sector Reform Programme 2016-2025. After years of preparations

and discussions at NPD Steering Committee meetings, the Programme was adopted by the

Government in December 2015 and implementation is underway. Most importantly, the

programme established a framework for the transition to water resource management

according to the basin principle by 2020 and clarifies the competencies of different national

institutions in the water sector.

Tajikistan is not a Party to the Protocol on Water and Health but sees value of being engaged.

With support from Finland, revision of 2013 draft targets in context of the Protocol started in

mid-2015. At 12 April 2016 NPD Steering Committee meeting the progress was reported and

finalised targets are expected by the end of 2016.

Table 8. Tajikistan – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Ensure application

of IWRM principles

Discussion platform for local

stakeholders provided in

form of NPD Steering

Committee meetings

(normally attended by over

60 participants)

National Water Sector

Reform Programme 2016-

2025 adopted by

Government in December

2015

The activities in Tajikistan over the reporting period contributed to Action 2.1 (preparation of

the policy packages on water policy reforms).

Support to application of IWRM principles in irrigation sector further contributes to the

implementation of Water Framework Directive (WFD) principles in Tajikistan as one of the

Overall Objectives of the project.

12

See also http://www.unece.org/env/water/npd/countrydialogues/tj

Turkmenistan (TM)13

In Turkmenistan, the preparations for and implementation of institutional reforms in water

sector lead to minimal level of NPD activities during the reporting period. In January 2016,

the key partner - former Ministry of Water Economy - was merged with Ministry of

Agriculture. In result, the Chair of NPD process was changed as well. NPD Steering

Committee meeting was announces and prepared for 1 April 2016 but was cancelled by the

Ministry few days before. In order to establish the contacts with newly created Ministry of

Agriculture and Water Resources, UNECE Deputy Executive Secretary Mr Andrey Vasilyev

met minister Mr Nursahet Sapardurdyyev in Ashgabat on 11 May 2016 to discuss

continuation of NPD process.

After acceding to the UNECE Water Convention in 2012, the development of new water

legislation has been the priority for UNECE support. In the framework of the NPD process

and with support of UNECE, an inter-ministerial expert group drafted a new Water Code in

2013-2014 to enact necessary legal changes in line with the Water Convention and principles

of IWRM. UNECE kept pushing for speedy adoption but the Code was finally adopted by

Mejlis, the National Parliament only in October 2016. The new Code opens up possibility for

shift from administrative to basin principle, clarifies rights of Water User Associations,

introduces goals for close cooperation with neighbouring countries and deals with

transboundary impacts.

Table 9. Turkmenistan – highlights of the activity period 01.06.2015-31.05.2016

Focus of activities Activities carried out Outputs

Promotion of

international treaties

on water

management

Bilateral meetings were

organised between UNECE

Deputy Executive Secretary

and senior Turkmen

decision-makers to increase

political support to joining of

relevant UNECE treaties

Awareness of officials from

many relevant ministries

and agencies raised

Modernisation of

water legislation

Constant contact with

Parliament to guarantee

expert support for finalising

of new Water Code

New Water Code adopted

(after end of the reporting

period, in October 2016)

The activities in Turkmenistan over the reporting period contributed to Action 2.1

(preparation of the policy packages on water policy reforms).

Promotion of international treaties on water management contributes to the implementation of

Water Framework Directive (WFD) principles in Turkmenistan as one of the Overall

Objectives of the present project.

Ukraine (UA)

Although the EUWI National Policy Dialogue process on IWRM started in 2007 it has been

on hold since then due to political instability in the country. Preparatory missions by the

UNECE took place in December 2015 and January 2016 and aimed to discuss priorities of the

upcoming EUWI+ project and to seek options of re-establishing the NPD Steering

Committee. Discussions were held at the Ministry of Ecology and Natural Resources, State

13

See also http://www.unece.org/env/water/npd/countrydialogues/tm

Agency of Water and with relevant international donors. Consultations with the Ministry of

Ecology continued at the margins of the EUWI EECCA working group meeting that took

place at the OECD in May 2016.

3.3 Work package 3 (Benchmarking and exchange of experiences)

The aim of Work package 3 was to establish a common understanding of water policy

reforms across EECCA countries. Two activities were envisaged: (1) benchmarking

achievements of the countries in achieving the MDGs and implementing IWRM principles in

their legislations, (2) coordination of NPD activities with other actors in the region working at

local, transboundary and regional levels.

Benchmarking

The second benchmarking report “Implementation of the Basin Management Principle in

Eastern Europe, the Caucasus and Central Asia” was released in May 2016, written by Peep

Mardiste and UNECE consultant Vahagn Tonoyan. While the first report from 2014 gave an

overview of implementation of all key IWRM principles in the region, the 2016

benchmarking report concentrated on the key principle of IWRM – adoption and

implementation of the basin principle. The Study was released in English and Russian.14

Coordination of activities

Efforts were made to ensure that NPDs provided a platform for coordination of water sector

activities in the respective countries. Donor coordination sessions at the meetings were

organised as part of most NPD Steering Committee meetings and attracted high participation

from donors and international organizations. Donors that participated in Steering Committee

meetings were EU, Austria (ADA), Czech Republic, Finland, Germany (GIZ), Japan (Jica),

Norway, Switzerland (SDC), USA (USAID), OSCE, UNDP, WHO, World Bank, EBRD and

ADB.

19th EUWI EECCA Working Group meeting (12-13 May 2016, Paris)

The 19th EUWI EECCA working group meeting took place in May 2016. Chaired by

Romania, the meeting gathered around 40 experts from the region and donor organsiations

and provided a platform for interaction and cooperation.

Meeting delegates acknowledged the role of EUWI in promoting water sector reforms in the

region and expressed their appreciation for the substantial financial support provided by the

European Commission and bilateral donors in the region. Participants underlined the

importance of involving line ministries and addressing conflicting goals through consensus

building and recalled the recent progress made as part of National Policy Dialogues within the

region and welcomed plans for continued cooperation in 2016-2020.

14

See

http://www.unece.org/fileadmin/DAM/env/water/meetings/NPD_meetings/Publications/bench

marking-2016-EN.pdf (English version) and

http://www.unece.org/fileadmin/DAM/env/water/meetings/NPD_meetings/Publications/bench

marking-2016-RU.pdf (Russian version)

Delegates requested more frequent regional exchange of progress and also requested that

support for SDGs implementation be among the EUWI goals. Finally, the need to put more

focus on implementation in the next phase of the EU-funded project was discussed.15

NPD plenary discussion and side event at the 7th Meeting of Parties (MOP) of the Water

Convention (17-18 November 2015, Budapest)

The NPD side event was organised during the first day of the MOP, within the high-level

segment. Success of the NPD process was underlined in presentations by the UNECE

Executive Secretary (Under-Secretary-General UN) and representatives of OECD and

Romania as Chair of the EUWI EECCA Working Group. Reresentative of the European

Commission informed participants about decision to finance EUWI+ project for 2016-2020.

New Memorandums of Understanding for next phase of EUWI project were signed at the side

event between UNECE Executive Secretary and deputy ministers of environment from

Georgia and Moldova. The plenary discussion on NPDs on 18 November involved deputy

ministers from Armenia, Georgia and Kazakhstan as panelists, providing case studies of

successful interventions of NPD framework.

Contribution to the World Water Week 2015 (27 August 2015, Stockholm)

UNECE representative participated at the EUWI Multi-Stakeholder Forum, organised during

the World Water Week on 27 August 2015 in Stockholm. The Forum presented experience

and good practice from the ongoing work and debated on further actions developed in the

different partnerships established in the EUWI framework.

Policy Perspectives

Policy Perspectives summarising regional work on Economic Instruments for water resources

management and on the economic dimension of water management in the transboundary Kura

basin, were prepared by the OECD to communicate results and lessons learnt from the work

in EECCA. Policy Perspectives are a good tool for consolidating results from a number of

projects ahead of dissemination. These documents were distributed and presented within

EECCA countries, at NPDs and at the EUWI EECCA WG meeting in May 2016. They were

also distributed at the EfE Ministerial conference in Batumi in June 2016.

The “Reforming economic instruments for water management in EECCA countries” Policy

Perspective summarises key policy messages and recommendations on the role of economic

instruments in addressing challenges and achieving key water policy objectives including

relevant Sustainable Development Goals (SDGs) in the Eastern Europe, the Caucasus and

Central Asia (EECCA) countries.16

The document concludes that Economic instruments have

an important role to play in achieving water policy objectives including water-related SDGs

and that existing economic instruments in EECCA countries require improvement to deliver

these objectives.

15

http://www.oecd.org/env/outreach/euwaterinitiative2016wgmeeting.htm 16

https://issuu.com/oecd.publishing/docs/policy_perspective_economic_instrum

3.4 Work package 4 (Dissemination of project information and stakeholder

involvement)

Dissemination of project information

During the reporting period a number of actions were undertaken to implement the

Communication Strategy. These included:

An update of a brochure “The Reform of Water Policies in Eastern Europe, the

Caucasus and Central Asia in 2006–2016” by OECD and UNECE was released in

May 2016, indicating success stories and future plans in the region.17

One issue of the 8-page EUWI NPD newsletter (November 2015).18

Four press releases were issued by UNECE, in English and Russian, to feature

achievements of NPDs.19

Information has been regularly updated on dedicated web-pages on OECD and

UNECE websites (http://www.oecd.org/env/outreach/partnership-eu-water-initiative-

euwi.htm); www.unece.org/env/water/npd), as well as at EU development

cooperation site http://capacity4dev.ec.europa.eu/env-east. Websites give access to

presentations made at the meetings, meeting reports, other relevant reports,

newsletters and press releases. Both websites are extensively used in the EECCA

region as a source of information on IWRM and WSS issues.

The following substantive reports on river basin and country specific NPD activities were

prepared in the period of June 2015 to May 2016. The reports were used for communicating

policy relevant results and lessons learnt and dissemination within EECCA countries:

Implementation of the Basin Management Principle in Eastern Europe, the Caucasus

and Central Asia20

Sustainable Business Models for Water Supply and Sanitation in Small Towns and

Rural Settlements in Kazakhstan21

Reforming Economic Instruments for Water Resources Management in Kyrgyzstan 22

Improving Economic Instruments for Water Resources Management in the Republic

of Buryatia (Lake Baikal Basin) 23

Legislation, Regulations, Key Actors, their Inter-action and Roles in the Water

Supply and Sanitation Sector of the Kyrgyz Republic: Brief Overview

17 see https://issuu.com/oecd.publishing/docs/euwi_report_layout_english_june_01. 18 see http://www.unece.org/index.php?id=42610 19 see http://www.unece.org/env/water/npd/news 20

See http://www.unece.org/fileadmin/DAM/env/water/meetings/NPD_meetings/Publications/benchmarking-

2016-EN.pdf (English version) and

http://www.unece.org/fileadmin/DAM/env/water/meetings/NPD_meetings/Publications/benchmarking-

2016-RU.pdf (Russian version) 21http://www.oecd.org/countries/kazakhstan/sustainable-business-models-for-water-supply-and-sanitation-in-

small-towns-and-rural-settlements-in-kazakhstan-9789264249400-en.htm) 22http://www.oecd-ilibrary.org/deliver/fulltext?itemId=/content/book/9789264249363-

en&mimeType=freepreview&redirecturl=http://www.keepeek.com/Digital-Asset-

Management/oecd/environment/reforming-economic-instruments-for-water-resources-management-in-

kyrgyzstan_9789264249363-en&isPreview=true) 23 (http://www.oecd-ilibrary.org/deliver/fulltext?itemId=/content/book/9789264266452-

en&mimeType=freepreview&redirecturl=http://www.keepeek.com/Digital-Asset-

Management/oecd/environment/improving-economic-instruments-for-water-resources-management-in-the-

republic-of-buryatia-lake-baikal-basin_9789264266452-en&isPreview=true)

Improving Domestic Financial Support Mechanisms in Water Supply and Sanitation

in Moldova

Strengthening the Economic Regulatory System for WSS in Moldova (Interim

report).

Assessing the environmental and economic value of water: review of existing

approaches and application to the Armenian context.

Facilitating the reform of economic instruments for water management in Georgia.

The NPD process was also used to provide oversight on production of the following

publications:

Reconciling resource uses in transboundary basins: assessment of the water-food-

energy-ecosystems nexus (November 2015)24

.

Final assessment of the water-food-energy-ecosystems nexus in the Syr Darya Basin

(November 2015)25

.

Reconciling resource uses in transboundary basins: assessment of the water-food-

energy-ecosystems nexus (chapter 5) ─ Summary nexus assessment of the

Alazani/Ganykh River Basin (May 2016)26

.

The NPD in Kazakhstan was also used to facilitate and promote dialogue on the following

substantive work streams:

Review and Assessment of Mechanisms and Instruments of State Support to

Agriculture, Rural Development and a Water Intensive Industry Impacting the Water

Sector in Kazakhstan (Interim report).

Strengthening the Role of Multi-Purpose Water Infrastructure in Kazakhstan (Interim

report on Shardara pilot study).

Stakeholder involvement

12 NPD Steering Committee meetings that took place in the reporting period were attended

by variety of stakeholders from within and outside government agencies.

An expert workshop under the OECD study on assisting Kyrgyzstan in developing

methodologies for the introduction of new economic instruments for water resource

management took place in Bishkek in April 2016.

24 see http://www.unece.org/env/water/publication/ece_mp.wat_46.html 25 see http://www.unece.org/index.php?id=41427

4. Difficulties encountered and measures taken to overcome problems

The main difficulties encountered during the reporting period included:

In Turkmenistan, the new Water Code that UNECE helped to draft in 2013 was kept

on shelve for years because Government wanted to enact it together with new Land

Code. With no progress to report, responsible ministry cancelled the planned 1 April

2016 NPD Steering Committee just few days before it was expected to take place.

Water Code was finally adopted by the Parliament in October 2016.

In Belarus, it was expected that following the March 2015 OECD-UNECE mission an

NPD Steering Committee will formally be set up by Government to start the NPD

process. The procedure proved however so complex that it was decided that the

Steering Committee will be set up after the launch of the EUWI+ project.

A key lesson is that maintaining direct contacts with both senior officials and middle

managers within ministries and agencies is essential to make sure that NPD processes

continue after political and/or institutional changes in the countries. Such approach has helped

to complete continue ongoing projects and to discuss new priority actions even if political

leadership has changed (such as in Armenia, Moldova and Turkmenistan during the reporting

period).

5. Changes introduced in the project implementation

Besides some delays with certain outcomes, there has been no major change in the

programme and activities planned for the reporting period.

6. Achievements and results

One of the key objectives of the project is to provide platforms for broad national-level

discussions on water management issues. During the reporting period, 12 high-level EUWI

NPD Steering Committee meetings were held in 7 participating countries. They resulted in the

following outcomes:

The elaboration of two by-laws to a new national water law in Georgia;

Adoption of new Water Code by the Parliament of Turkmenistan (after project

period);

The elaboration of a policy package consisting of the Methodological Guidelines for

Setting Fee Rates for the Use of Surface Water Resources and Water Bodies in the

Kyrgyz Republic, and draft Government Resolution on approval of the methodology;

Several regulatory gaps and inconsistencies in water legislation and regulation in

Kyrgyzstan revealed through respective studies led by the OECD (on methodology for

setting fee rates for the use of surface water resources and water bodies; and the

overview of legislation and regulation for WSS) triggered follow up work by

respective government agencies on improving water legislation and regulation;

Analysis of domestic financial support mechanisms in water supply and sanitation in

Moldova was completed and presented to respective authorities in Moldova, as well as

interim results of the follow up study aimed at strengthening the economic regulatory

system for WSS in Moldova;

Transboundary cooperation and/or treaties between following countries were

discussed, using National Policy Dialogues as platforms: Georgia-Armenia, Georgia-

Azerbaijan, Kazakhstan-Russia, Kazakhstan-Kyrgyzstan;

Results of analysis of the use of economic instruments for water management at the

national level (Kyrgyzstan) and the subnational level (Republic of Buryatia, Lake

Baikal Basin, the Russian Federation) were published. Overall results of the work on

this topic in all EECCA countries concerned as well as at the transboundary level (in

Azerbaijan and Georgia) were summarised in the Policy Perspectives brochure

prepared and published by the OECD and were used to communicate and disseminate

results in EECCA countries;

Results of analysis on sustainable business models for water supply and sanitation in

small towns and rural settlements in Kazakhstan published in respective report in the

OECD Studies on Water series, were communicated and disseminated in EECCA

countries;

Support to the reform of economic instruments of water management in Georgia

through developing recommendations on the reform steps;

Preparations for the ratification of the Protocol on Water and Health under Water

Convention were advanced in Armenia, Georgia, Kazakhstan and Turkmenistan.

Table 10. Main activities under the ongoing National Policy Dialogues

Instruments/frameworks AM AZ GE KG KZ MD RU TJ TM UA

Water Framework Directive’s principles.

EU Urban Wastewater Directive x x x x x x x x

UNECE Water Convention (transboundary waters) x x x x

UNECE-WHO Protocol on Water and Health x x x x x x x

Climate change adaptation (EU, OECD and UNECE

instruments) x

EU Flood Directive/UNECE instruments

Institutional frameworks (e.g. River Basin Councils) x x x x x

Overcoming fragmentation in, and sustainable business

models for WSS systems x

Economic instruments for, and financing of, water resources

management x x x x

New water legislation/strategy on IWRM x x x x x

EUWI EECCA Working Group (May 2016, Paris)

EECCA countries delegates confirmed their commitment to water policy reforms, and

approximation to EU acquis. Delegates acknowledged the political priorities of the European

Commission in the region (sustainable inclusive socio-economic development, security and

stability) and priorities for future work on water: the water-energy-food security nexus; green

economy; sustainable development goals and water diplomacy. The forthcoming EUWI Plus

project was presented and discussions took place about the need to maintain regional dialogue

with Central Asia. Delegates expressed their will to maintain the EECCA Working Group and

continue to meet annually.

Project activities and their results were presented at various international meetings, including

the World Water Week 2016 (28 August 2016, Stockholm).It allowed to co-ordinate in-

country work with other initiatives and mobilise an additional support to the regulatory

reform. For example the discussions within the NPDs in Kyrgyzstan and Tajikistan were used

to mobilise an additional support from Finland to follow-up activities supported by the

Project. In Kazakhstan, part of the implementation of NPD biannual workplan has been co-

funded (a) from the grant provided by the Government of Kazakhstan under the OECD

Country Programme for Kazakhstan and (b) through a new project financed through the EU

Delegation in Astana.

Annexes (provided in separate files)

Annex 1: Agendas of NPD meetings and the agenda and summary of the EUWI EECCA

Working Group held over the reporting period.

Annex 2: Additional output documents produced over the reporting period. Note: Other

output documents are provided via hyperlink in the body of the report.

Annex 3: Logical Framework for the project