UAE flags $141bn water funding gap amid AI demand
Greenlogue/AP The UAE has warned that a global water financing shortfall of as much as $141 billion a year threatens ambitions spanning artificial intelligence, energy transition, food security and rapidly growing cities. The warning was delivered at a private roundtable at the UAE’s Permanent Mission to the United Nations in New York, where about 50 chief executives, investors and philanthropy…
The United Arab Emirates (UAE) has highlighted a potential global water financing gap of up to $141 billion annually, presenting challenges for key sectors such as artificial intelligence, energy transition, food security, and urban development, according to a private roundtable at the UAE’s Permanent Mission to the United Nations in New York.
Abdulla Balalaa, Assistant Minister of Foreign Affairs for Energy and Sustainability, emphasized that water is a crucial element in economic growth, competitiveness, and resilience, linking it to the AI revolution, energy transition, food security, and rapidly expanding cities. He noted that data centers and digital infrastructure rely on reliable water supplies, particularly for cooling and electricity systems, alongside the constraints faced by energy, industry, agriculture, and urban development.
The World Bank estimates that additional annual spending is required to achieve universal access to safe water and sanitation, ranging between $131.4 billion and $140.8 billion. Developing countries currently allocate around $164.6 billion per year on water, which constitutes about 0.5% of their combined gross domestic product, with public sources covering approximately 91% of this expenditure and private finance contributing less than 2%.
Despite the availability of technological solutions, the main obstacle lies in preparing projects, allocating risks, and attracting capital that can sustain the long development cycles inherent in water infrastructure projects. Badr Jafar, Special Envoy for Business and Philanthropy, stressed that water is often undervalued, serving as the backbone for food, energy, urban areas, and digital infrastructure supporting artificial intelligence.
He argued that business, investors, and strategic philanthropy can aid governments in advancing these projects towards financial closure.
Participants discussed the various factors that hinder water schemes from becoming commercially viable, including project preparation, off-take arrangements, regulatory uncertainties, and operating risks. They also explored mechanisms like catalytic finance and first-loss capital to mitigate risks that conventional investors may shy away from. Long-term guarantees, local-currency financing, and dedicated project-development facilities were among the strategies proposed to bring more initiatives to market.
The meeting also examined opportunities in water reuse, leakage reduction, storage, efficient desalination, and digital monitoring, with a strong emphasis on the necessity for technology to be complemented by robust governance and local expertise. Official development assistance for water has declined by 23% in 2025, increasing the urgency to mobilize commercial and blended finance.
As the UAE prepares to co-host the UN Water Conference in Abu Dhabi from December 8 to 10, the conference aims to accelerate the implementation of Sustainable Development Goal 6, which focuses on ensuring the availability and sustainable management of water and sanitation for all.
Written by urgent.news from Arabian Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
