The state of affairs in Serbia’s water sector is not satisfactory. There are many problems in the segments of water use, water pollution control and protection against the adverse effects of water, both on the ground and with regard to water sector organization. Less than half of the population enjoys enough water of good quality at their household taps. Only about 10% of the population has access to wastewater evacuation that includes treatment prior to discharge into recipients. The public is well aware of the issues associated with the protection against the adverse effects of water (floods, erosion, torrents). The demands of the population and the requirements associated with the protection of water resources, relevant and potential practitioners[D1] , fitting into international relations, and compliance with standards in this area are substantial.
Quite accurate estimates indicate that over the next ten years or so 10 million € will need to be spent to fix the circumstances on the ground and about as much to operate and maintain infrastructure.
Water management requires economic, systemic, institutional and legislative backing, as well as a capacity base, to tackle the enormous task that lies ahead.
Water sector turnover will need to increase from the present 300-350 million € to about one billion annually. The current drinking water rate in Serbia is 0.4-0.7 € per cubic meter and should certainly be increased to an economic level, which is 1.4 per cubic meter.
The task needs to be addressed and completed efficiently, deploying and developing domestic resources as well as using international private capital. The ultimate goal is to strengthen water sector governance and the country’s ability to respond to vital natural, economic and political challenges in that regard.
With all this in mind, Jaroslav Černi Institute for the Development of Water Resources has recently undertaken studies and research aimed at supporting the Ministry of Agriculture and Environmental Protection/National Water Directorate to create a concept and develop a strategy for improving the present state of affairs and establishing appropriate water governance. The fundamental document that deals with this topic is the Water Management Strategy of the Republic of Serbia 2016-2034 (hereafter: the Strategy), which, according to the Water Law (Official Gazette of the Republic of Serbia, nos. 30/10 and 93/12), is the blueprint for water sector reform aimed at achieving needed water management standards on national, regional and local levels and fulfilling water management objectives.
The Strategy also proposes and prioritizes activities and measures for achieving set objectives and addresses the funding, timeframe and functions needed for success. The Strategy was drafted at the end of 2014, underwent public debate during the course of 2015 and at the end of 2015 was distributed for inter-ministerial harmonization, which has not yet been finalized even though most of the ministries have provided their comments.
The fundamental notion of the Strategy is that the water sector activities needed to achieve good status and comply with the very stringent and financially demanding EU legislation, should serve as a flywheel to jumpstart the economy and attain the desired status of water resources and the environment in general. This requires considerable legislative, administrative, economic, capacity-related and other changes to current water governance.
Financial strengthening of the water sector is a key driver of successful completion of the proposed activities, which should be ensured by increasing drinking water rates and service charges to economic levels and involving other sources of funding, keeping in mind not to threaten the standard of living, on the one hand, and on the other hand to ensure that borrowing will not endanger the country’s macroeconomic stability. The Strategy calls for a gradual increase in drinking water rates, over a period of about five years, meaning about 15 or 20 € per month for an average household, as well as for the allocation of a part of the revenue to domestic accumulation of capital (water fund or bank), which would help finance the needed water infrastructure construction activities.
This will lead to more efficient involvement of now considerably weakened domestic companies that engage in exploration, engineering, contracting, construction supervision, and the like, given that, at present, most of the water infrastructure funding comes from international loans and grants. Domestic companies, at best, take part only as subcontractors of international companies, under very unfavorable terms.
In addition to engineering companies and building contractors, certain other industries will benefit from these activities, such as mechanical, electrical, etc., in view of the fact that an attempt will be made to involve as many domestic industries as possible in the manufacture of equipment, piping and other products for the proposed facilities.
The establishment of a domestic water fund or bank would facilitate the preparation of projects that will be funded by the European Union, given that domestic sources of funding virtually do not become involved in project preparation at this time. Instead, this is undertaken rather slowly and inefficiently by certain foreign organizations and is coupled with enormous problems in the implementation stage due to poorly developed documentation and inadequately followed procedures.
The strategy also calls for capacity building of the administration and other institutions at central and local levels, and proposes that water supply and wastewater evacuation and treatment become a more visible segment of water management because the most demanding future obligations of the water sector will be related to healthy drinking water supply and water pollution control – construction of wastewater treatment plants.
The Strategy further calls for ongoing development of irrigation within the framework of general agricultural development, and requires that much more attention be devoted to efficient water use based on proper crop-specific irrigation depths and farmer training in modern irrigation techniques, protection from drought, association and product placement. This can be of great benefit for overall rural development, particularly in the southeastern and southwestern parts of Serbia which currently suffer from an extensive population drain. Delivery of healthy drinking water and development of irrigation will motivate the rural population to remain in these regions.
The Strategy is aligned with all the EU accession steps, but it takes into account that the required spending (more than 8 billion € over a period to be negotiated) must not threaten the country’s macroeconomic stabilities. Instead, it should increase Serbia’s gross domestic product and support development.
A precondition for successful implementation of the Strategy is capacity building in all water sector segments, through better, systemically-regulated collaboration with science, research and education.
The implementation of the Strategy will help to, inter alia:
· increase GDP,
· reduce the national debt,
· maintain and improve domestic capacities,
· enhance public health, through improved water supply and provision of wastewater evacuation and treatment,
· generally improve the environment, given higher river water quality standards, reduced groundwater pollution, and the like,
· raise the level of safety by protection measures against river floods, flashfloods, erosion, etc.
If the Strategy is not approved:
· there will be no accumulation of funds for the necessary water sector activities,
· the national debt will unavoidably increase,
· there will be a further capacity decline in all water sector segments,
· economic development will be hindered.
The overall conclusion is that the establishment and efficient implementation of the Strategy will halt further caving of the water sector and contribute to better control of many important segments of economic and social life in Serbia.