1. Overview

The Water Policy Outlook study aimed to compare and contrast existing policy frameworks against the long-term strategic plan and vision for the water sector by respective governments. The outlooks aimed to map the future policy challenges and policy reform opportunities required to achieve these long-term strategic objectives. This innovative work was applied in Georgia, the Republic of Moldova and Ukraine for the first time in 2019-20. These countries are of particular interest, as many of the long-term strategic objectives are based on Association Agreements with the European Union, which set the ambition and direction of water policies and contain time-bound requirements to approximate to EU legislation including the Water Framework Directive.

The outlooks baseline the country policy framework and current performance and challenges and then define the long-term vision and aspirations to 2030, identifying opportunities for improving policy coherence and reform. These outlooks are intended to be used to stimulate policy discussion at the national level and have potential to be replicated in other countries throughout the EECCA region as methodology is reviewed and further developed and refined.

Despite recent progress in the countries, it is considered that Georgia, Moldova and Ukraine are unlikely to fully meet their stated policy targets by 2030 following a “business as usual” application of existing policy frameworks. Challenges are numerous including legal and regulatory gaps and poor implementation, inconsistent development and application of economic policy instruments and coordination challenges from fragmented institutional frameworks leading to inefficiencies in water management.

The Association Agreements with the European Union pose a particular challenge with a set timetable and ambition for progression. In particular the requirements for alignment with the Water Framework Directive and associated EU Directives pose legislative challenges and institutional challenges. They reveal a considerable back-log in terms of water and wastewater infrastructure requirements. The infrastructure gap is particularly notable with regard to the meeting obligations under the EU’s Urban Wastewater Treatment Directive, and achieving SDG 6.1 and 6.2 targets in rural areas. The establishment of technically and financially sustainable River Basin Management Organisations also poses a challenge.

“Business as Usual” scenarios predict: revenues generated with the existing tariffs for water supply and sanitation services are insufficient for improving the quality of water management; where they exist, economic instruments (abstraction and pollution charges) are ineffective in driving water use efficiency and discouraging water pollution; rural populations may be “left behind” with regard to water supply and sanitation development; water consumption patterns will remain inefficient, with wastage through distribution and use and unclear water allocation regimes; water pollution is likely to increase and water quality will deteriorate with an associated impact on the loss of biodiversity; governmental water resource management expenditure will likely be affected by the negative impact of COVID-19 magnifying the need to become more targeted and cost-effective.

Most Government strategies strive to contribute to universal and equitable access to safe and affordable drinking water, adequate sanitation and improved hygiene, a reduction in water borne diseases and a reduction in the number of illnesses and fatalities from water pollution. However, in the region, strategy documents typically focus on a narrow discussion of aspects of water policy, being sector specific e.g. irrigation or water supply and sanitation management. A unified and comprehensive strategic vision is required to ensure universal access to safe water and the rational utilisation of water resources. This will aid prioritisation of action and optimise the use of limited resources.

Key issues in terms of achieving policy goals such as progression of SDG targets and alignment with the EU’s Water Framework Directive were identified as:

  • Georgia: legislative barriers blocking progress - notably the need to progress the Draft Law on Water Resources Management and consider future implementation and enforcement arrangements.

  • Moldova: a lack of financial resources - better coordination of institutional (agglomeration) and investment measures, aiming at economy of scale, as well as exploring new financing mechanisms based on improved water demand management and taxation of water use and pollution.

  • Ukraine: sector fragmentation and absence of an overarching national water resources strategy to align sector priorities and strategic financing.

The annual costs of full reform scenarios were estimated as follows:

  • Georgia: EUR 197 million (equivalent to EUR 52.9 per capita)

  • Moldova: EUR 2.04 billion (equivalent to EUR 76.8 per capita)

  • Ukraine: EUR 23 billion (equivalent to EUR 57.5 per capita)

Differences in reporting and classification of costs across different governmental departments leads to difficulties in linking public expenditures to particular water-related EU directives or specific national strategic goals. Monitoring and assessing overall cost-effectiveness of public expenditures on water resources management remains a challenge and opportunity for further work. The importance of appropriate enabling environments to pave the way for reform is also a key lesson learned.

Georgia, Republic of Moldova, and Ukraine have all signed Association Agreements (AA) with the European Union. These Agreements commit the countries to approximate EU Directives into national legislation and to implement international standards, including in the fields of environment and water management. Obligations are extensive, for example in Moldova, EU policies on environment, natural resources management and climate change entail nearly one third of Moldova’s commitments in the AA, requiring the approximation of over 40 legal acts (“acquis communautaires”) and setting the grounds for their further implementation.

Although water is abundant in Georgia, its quality, due to anthropogenic factors varies widely. A prominent source of pollution is the discharge of untreated wastewater into surface waters. Over a third of wastewater discharged into water bodies in Georgia is insufficiently treated. Therefore, water quality is highly dependent on the type of wastewater discharged upstream and its level of treatment. Abstraction from surface water bodies for agricultural needs has more than doubled since 2003, and higher concentrations of agriculture-linked pollutants have been recorded near agricultural areas due to leaching.

An additional challenge in Georgia is the population’s relatively low level of access to modern water supply and sanitation systems. While the share of Georgians connected to public water supply systems and sanitation has consistently increased, as of 2019, one third of the population still lacks access to the public water supply and about half of the population does not have access to wastewater collection systems. Improving access to modern water supply and sanitation services and minimising the discharge of untreated or insufficiently treated wastewater into surface water bodies should be among the key objectives in Georgia’s strategy to safeguard its water resources.

Georgia relies on its water resources not only for domestic, agricultural and industrial use, but also for the vast majority of its power generation. Tensions between these competing uses have emerged, which are mentioned in the Irrigation Strategy of Georgia and can be summarised as follows:

  • Irrigation and hydropower plants (HPPs) – Conflicts with HPPs occur during the irrigation season when largescale power production occurs and rivers are at low flow. This is a particular concern when water used by HPPs is diverted outside the basin and is therefore unavailable for downstream irrigation;

  • Irrigation and drinking water supply – Although around 60% of Georgian drinking water comes from groundwater, Tbilisi and districts including Bolnisi, Dmanisi, Marneuli, and Tsalka depend on surface water for their potable supply; a large portion of the capital’s supply is from the Tbilisi Reservoir. Since surface water is also used for irrigation, this creates a conflict between these two uses of surface water;

  • Irrigation schemes along the same river – There can be several irrigation canals in a single river and competition between them increases when, in summer and autumn, water demand is high and supply is low.

The irrigation strategy highlights that Georgia is generously endowed with water resources, though availability varies greatly from season to season. In addition to its surface water resources, Georgia has abundant groundwater which, although little used at present, could be tapped for irrigation – particularly in drip irrigation systems.

The irrigation strategy also outlines some critical issues related to the Draft Law on Water Resources Management and suggests that, overall, there are two fundamental challenges affecting the adequate provision of irrigation services:

  • Ensuring the operation and maintenance of facilities used to deliver water for irrigation;

  • Generating sufficient revenues to cover the operation and maintenance cost of those facilities.

These challenges are pertinent not only for irrigation systems but also for the general water infrastructure, most of which is outdated and requires rehabilitation.

Yet another challenge is outlined in the Agriculture and Rural Development Strategy of Georgia 2021-2027, and relates to the inefficient use of water and its contamination by agricultural and non-agricultural enterprises. Consequently, in spite of the annual increase in irrigated area, some regional access to cheap water for irrigation is limited and the overall quality of water is deteriorating.

The issue of contamination of surface and ground water is addressed in the National Strategy for Waste Management and the Action Plan, according to which there is at least one unofficial landfill in each Georgian region, leading to water contamination. The action plan therefore envisions the development of wastewater treatment plants with donor support.

Moldova’s water resources are characterised by typically poor water quality and that river flow formation occurs outside of the country borders. The largest surface water sources in Moldova are the Dniester and Prut Rivers. However, their available volume depends essentially on the territory of Ukraine, where around 80 percent of the rivers’ flow is formed. The total average annual discharges of all other inland rivers flowing in the country is comparatively smaller, making the Dniester and Prut rivers extremely important water sources. Moldova’s hydrographic network also includes roughly 60 natural lakes and approximately 3500 artificial reservoirs and ponds constructed for irrigation purposes, flow regulation, and fishing pools. The main ground water reserves hold a total of 1.3 km3, including 0.7 km3 of water of drinking quality. However, groundwater is often too mineralised to be used for domestic or irrigation purposes.

With respect to water quality, which has implications on available quantities, Moldova is still facing issues. Nearly 50% of rivers and streams are considered heavily polluted and 27 percent polluted, making them unfit for swimming, fishing and drinking. Further, less than 50% of the groundwater reserves meet the required drinking water quality standards. More specifically, within the territory of the Dniester Basin in Moldova, 94% of waterbodies are assessed at risk of not achieving good ecological status. Water pollution within Moldova is caused by both point and diffuse sources including wastewater effluent discharges which, although regulated, are not yet under control. In addition, transboundary pollution contributes to water quality problems in Moldova. According to the Dniester river basin management plan (RBMP), two additional cycles (until 2039) are needed to achieve a good ecological status - if urgent measures are taken and implemented.

Moldova’s available water resources are also expected to be further impacted by future climate change. Climate models under various scenarios predict a decrease in water availability and resources unless adequate adaptation measures are taken on time. Specifically, climate change is projected to decrease surface flows by 16–20% by 2030 and models project lowering precipitation will decrease annual runoff by 13% with annual flows becoming more unstable with more frequent spring and flash floods.

Water use has been relatively stable over the past two decades, while a generally shrinking population has led to modest increases in water availability per capita. Groundwater and surface water abstractions as well as the water used for production and drinking needs remained relatively stable between 2014-2019 while access to safely managed water resources and access to sewerage services both saw marginal increases over the period. Despite this, areas with vulnerable, mainly rural, populations are already experiencing water shortages, as well as decreasing water depth in unconfined aquifers due to overexploitation. Although Moldova is far from facing severe water stress, higher water stress conditions are exacerbated by seasonal fluctuations.

Water management in Moldova was optimised in 2013, integrating IWRM principles whereby the three hydrographic basins in Moldova were merged into two river basin management districts (RBMD). Accordingly, two RBMPs were developed along with two River Basin Committees to implement the IWRM management principles. The country’s water agency, Apele Moldovei, has begun to reform its functions and structure and is responsible for RBMP implementation and coordination at the national level. The two river basin districts share similar challenges deriving from climate change, natural disaster risks, and negative anthropogenic impacts. Impacts are primarily due to the high share of ploughed agricultural land, the significant hydro-morphological changes along the rivers, and the discharge of insufficiently treated wastewater from public utilities and industries.

On a transboundary level, cooperation with Ukraine is crucial for improving the status of the Dniester River and ensuring more sustainable management. Understanding this, the new cycle of the Dniester River Basin Management Plan (2022-2027) extends to focus on transboundary aspects.

Ukraine is a relatively water-abundant country, though resources in the country are fragile in terms of their formation and distribution, and having a large population, with an economy often linked to agriculture, means water use is intensive. Resources are unevenly distributed across the country's territory due to climate conditions, topography, and the geological structure of individual river basin districts. The Dnieper River basin’s significance is difficult to overestimate as it is the largest Ukrainian Basin and its water resources make up 80% of all water resources within the country, supplying drinking water to two-thirds of the population. The southern regions of Ukraine host the majority of agricultural and industrial water users and consequently, the regions suffer from water stress and insecurity, since they rely solely on the Dnieper River. This concentration of water resources is compounded by the fact that only a fraction of Ukraine’s water resources are formed in country, with the majority being formed in Belarus, Romania and Russia.

Further to this, the pronounced long-term hydrological regime change over the last 20 years has led to the shallowing and further disappearance of small rivers and streams. The impacts of climate change, lax definitions around ecological water requirements, and the large water requirements of industrial and agricultural production, among other drivers, are contributing to these hydrological regime changes. Intensive agricultural activity is particularly reducing runoff in two regions by up to by 10%. In addition, poor water quality, caused by the discharge of insufficiently treated wastewater into water bodies, due to a lack of infrastructure, impacts water resource availability. These water resource conditions highlight some of the fragilities within the Ukrainian water resource environment and the need for more robust management.

Freshwater abstractions in Ukraine have begun to increase in recent years (following decreases between 2000 and 2015). Industrial needs dominate water abstraction, with irrigation and drinking water needs being roughly similar though representing the second and third highest water use categories. Most abstractions are from surface water sources with groundwater and marine water being used in relatively smaller quantities (85%, 10.4% and 4.6% respectively in 2019). Water use for household and drinking needs is impeded by the lack of water supply and sewerage infrastructure. By 2030, Ukraine aims to overcome inequalities in access to water and sanitation by guaranteeing a social minimum for drinking water and sanitation conditions. In support of this, over 1 160 reservoirs with a cumulative volume of approximately 55 cubic kilometers have been constructed.

In line with EU Water Directives, Ukraine defined nine river basins districts with RBMPs to achieve specific environmental objectives for each basin. They were developed based on best practice for the implementation of the EU’s Water Framework Directive. The common goals across all basins include achieving and maintaining the good ecological status of surface and groundwater bodies, and the good ecological potential of artificial or significantly altered surface waterbodies. As of 2021, RBMP implementation has begun on only one of Ukraine’s nine river basin districts, the Dnieper River Basin. In the Dnieper RBMP’s next cycle, assessments of water monitoring results should further build on the programme of measures to achieve the relevant environmental objectives of the basin. The plan will serve as the basis for other RBMPs throughout Ukraine that are currently in development.

Currently, the RBMP’s objectives are taken up on a transboundary level by the Strategic Action Programme (SAP) for Dniester River Basin developed on the basis of a Transboundary Diagnostic Analysis (TDA) of the District.1 The SAP adoption by the Moldovan and Ukrainian governments is expected in 2021. Both the TDA and SAP are considered a good basis for the second cycle of Dniester RBMP and for the development of Moldova’s country specific Programme of Measures.

The current water management environment in Georgia can be viewed through the legal, regulatory, institutional and policy lenses. There are opportunities within these frameworks for improving effective water resource management and opportunities exist to improve alignment with EU Directives and the Association Agreement. The existing legislative framework defines several administrative bodies as responsible for various water-related matters, meaning management is fragmented. Similarly, Georgia’s regulatory framework is considered complex, and the system is siloed, often without a unified approach. Institutional responsibilities, although formally disseminated at the national and local levels, typically operate in a centralised manner due to limitations in their functioning. The policy framework would benefit from a comprehensive strategic vision to support policy development.

The current legislative framework has ambiguities and shortcomings which can complicate the efficiency of water management in Georgia. The principal article of national water legislation is the Law of Georgia on Water (1997) (the Water Law), which regulates the Georgian water resource management system. Despite being the key piece of legislation for water sector regulation and establishing the major objectives and principles of water resource management policy, the Water Law is currently under review, though proposed changes to align with EU legislation have not yet been implemented. Shortcomings with the existing law include the lack of requirements for the sustainable and effective management of water resources; no comprehensive or clear regulations for the prevention of water pollution and no direction regarding the excessive use of water resources.

Georgia has designed the new draft law on water resource management to align water management with the major principles and approaches provided within the relevant EU Directives and to fulfil Association Agreement obligations. The draft law covers surface water bodies and underground fresh water and stipulates quantity and quality. Although yet to be adopted, the draft law can be considered robust and well aligned with EU objectives, overcoming the major legislative gaps of the existing water law. It will establish a legal framework for water resource regulation and provide a better understanding of the distribution of powers among the responsible institutions.

The draft law complies with the EU Water Framework Directive and establishes an integrated water resource management system, using the principles of river basin management. It designates responsible agencies and fulfils the requirements of the relevant provisions in the Water Framework Directive. It also provides specifications for the preparation of river basin management plans, ensures public participation in discussions, and sets obligations for the publication of river basin management plans. More precisely, river basins’ boundaries will be determined by the government via the adoption of the relevant resolution.

Georgia’s water resources are divided into two catchment areas, the western one flowing to the Black Sea with a cumulative annual volume of 49.8 km3, and the eastern one emptying into the Caspian Sea via Azerbaijan with a cumulative annual volume of 16.5 km3. The new draft Law on Water Resources Management, and the subsequent draft governmental Resolution on the Approval of the Boundaries of Basin Territorial Entities of River Basin Management, proposes six territorial entities, or River Basin Districts (RBD), to be established within Georgia’s territory. Within the Association Agreement with the EU, Georgia committed to developing and adopting Water Framework Directive (WFD) compliant RBMPs for all its river basin districts, including the involvement of the public in consultations. Under the Agreement, plans should be implemented within ten years of signing the Agreement. While progress has been made with the development of RBMPs, until the draft law on Water Resources management is adopted, no activity can commence. To understand the financial requirements of the RBMPs, programmes of measure of priority water management interventions in basin plans, have been identified and financially evaluated These costs are forecast to be incurred over a six-year period, to 2024, corresponding to the first implementation timeframe of the RBMPs.

To overcome the current legislative shortcomings, the draft law establishes a classification system for water bodies, sets objectives and standards for water quality, provides water pollution prevention measures, sets a monitoring and enforcement system, including monitoring programs, classifies river basin districts, and ensures public participation. A key feature of the draft law is the establishment of a permit system for abstraction from and discharge into surface waters, together with fees for water usage. Monitoring compliance and enforcement will be key.

The draft law also provides new institutional arrangements for water resource management, clearly and systematically defining the responsibilities and obligations of governmental agencies and municipalities in water resource regulation processes.

Implementation of the new water law would be supported by improved regulations. Current issues with regulation include the lack of a common vision and approach by the state and existing regulatory bodies, a lack of charges for surface water abstraction, and weak and underdeveloped water monitoring and control systems for planning and implementing water management activities. Regarding monitoring, it is imperative that the regulatory framework provides specific criteria for the evaluation of water quality and quantity. Controlling, monitoring, and creating integrated databases would further support robust water management.

Institutional responsibilities for water resource management are split between the national and local levels, though due to technical and financial capacity limitations, the system is largely centralised. Cooperation between agencies is often difficult and their functions are not oriented towards solving the system’s obstacles. Further, decentralisation of powers between central and local governments is often unfeasible due to resource limitations and issues with timely coordination and cooperation among agencies.

Although the functions of each institution are prescribed in relevant laws and subordinate legal acts, the regulatory system still lacks a unified governing strategy that coordinates their work efficiently. Regulation is limited at the local level due to the weak institutional, professional, and financial capacities of municipalities, meaning they often cannot exercise their prescribed responsibilities.

Moldova’s recent (2016) legislative, regulatory, institutional, and policy reforms achieved better alignment with EU Water Framework Directives and its associated directives although bottlenecks still exist. The reforms achieved needed economies of scale, though also delegated responsibilities to agencies lacking the necessary knowledge, staff, and financial capacities for implementation.

Moldova has several policies shaping the water management policy framework in line with EU good practice. The National Development Strategy (NDS) “Moldova 2020” prioritised the provision of clean, accessible, and affordable water in the development agenda (this has now been updated to “Moldova 2030”), the Water Supply and Sanitation Strategy 2014-2030 (WSS Strategy) established ambitious targets to gradually ensure access to safe drinking water for the entire population by 2028, the National Environmental Strategy (NES) 2014-2023 partly addressed water sector needs through “soft” legal, institutional and awareness raising measures, and the National Programme for the implementation of the Protocol on Water and Health in the Republic of Moldova for 2016-2025 set targets and deadlines covering water, sanitation, hygiene, and health.

Moving forward, the WSS Strategy was extended to 2030 and new Action Plans were adopted to support implementation. The initial Action Plan (2014-18) made progress in WSS provision, though there were discrepancies between provision to urban and rural areas. The major objective of the 2020-24 Action Plan was to cover the urban rural gaps and to provide 80% and 75% coverage in urban and rural areas respectively by 2025. In addition, the current plan pursues more specific objectives at the river basin district level. These objectives are outlined in and implemented through the River Basin Management Plans.

Alongside the WSS Strategy, Moldova’s National Programme on the “Implementation of the Protocol on Water and Health in the Republic of Moldova 2016-2030” underpins the SDG 6 targets and the objectives set in “Moldova 2030”. The Programme outlines 77 actions, such as strengthening the legal framework, improving water quality monitoring, and developing WSS infrastructure in order to achieve the major objectives which include improving water security, and ensuring an adequate supply of good quality water among others. To date, progress has been made in introducing the principles of IWRM to Moldova’s policies and legislation, decreasing water related diseases per 100 000 inhabitants, and reducing outbreaks of water related infections. However, considerable efforts are still needed to improve water quality of all sources used for human consumption.

Despite improvements in the policy framework, existing shortcomings impede Moldova’s water management. Inconsistent policy goals and overlapping objectives across strategies, fragmented planning and a lack of capacity, insufficient monitoring and evaluation, and low levels of public spending lead to an inconsistent policy environment, a wide urban-rural gap in water services provision, and a lack of data availability to inform decision making.

In line with the country’s international commitments, Integrated Water Resources Management principles were introduced into Moldovan legislation in 2018 in the Water Law No 272/23.12.2011. The legislation, responsible for implementing the EU directive “2000/60/EC establishing a framework for Community action in the field of water policy (WFD)”, develops the legal framework for integrated water resources management, establishes the legal framework for protection and efficient water use, establishes water rights, and stipulates measures for preventing the deterioration of state of water. However, the legislation contains gaps. Inefficient metering and monitoring mechanisms (with no monitoring alignment with the WFD requirements), a lack of comprehensive analysis and assessment of groundwater quality, and a lack of regulation on the use of groundwater for irrigation inhibit a more robust application of water management.

Legislative gaps and issues vary according to the alignment to the specific EU directive. However, there are similar issues that could broadly be addressed to strengthen the legal framework. Addressing inefficiencies in monitoring and metering, a lack of information sharing and publication, a lack of analysis and assessment of water resources and their quality – particularly groundwater, and weak enforcement of legislation and regulations could provide a more solid basis for general water management regulation and institutions.

The regulatory framework, which includes four principal regulations relating to water management are underpinned by codes of practice, River Basin Management Plans, and national guidelines. The major gap in water regulation involves a lack of direction in wastewater treatment. Specifically, the lack of implementation and enforcement of a permission system for water use and wastewater discharge. Overcoming these gaps would help resolve management issues stemming from the steadily increasing anthropogenic pollution of water resources and also provide more equal treatment of water users.

Sound and stable institutions in Moldova remain an important precondition for developing and implementing water policy. Though a lack of institutional stability and weaknesses of existing institutions contributes to problems in implementing the new integrated water management policy in the context of its approximation with the EU legal and regulatory framework. To assist in this coordination and provide good opportunities for engaging and empowering water management sector stakeholders, a National Policy Dialogue (NPD) platform was established in 2006. As part of the NPD, the steering mechanism has become a valuable platform for providing the needed horizontal cooperation between different sectors. Further, institutional arrangements regarding the provision of water and sanitation services were decentralised to local public authorities (LPAs) following the Law on Public Services of Communal Management (2002). However, drastic cuts in the number of staff of specialised administration, has seriously impacted the targeted performance of key public sectors in agriculture, environment, natural resources management, and regional and rural development. Although reforms yielded financial savings, they also assigned additional and new responsibilities to executive agencies that that do not always have the necessary knowledge, staff, and financial capacities to successfully implement them, hindering the effective implementation of objectives.

Looking at Moldova’s transboundary water management, the RBMPs’ objectives are currently taken up on a transboundary level by the Strategic Action Programme (SAP) for the Dniester River Basin developed on the basis of a Transboundary Diagnostic Analysis (TDA) of the district. The SAP adoption by the Moldovan and Ukrainian governments of Moldova and Ukraine is expected in late 2021. Both the TDA and SAP are considered a good basis for the second cycle of Dniester RBMP and for the development of Moldova’s country specific Programme of Measures. The Programme of measures will include transboundary actions such as establishing norms for water use (prevention of overuse), enforcing norms for wastewater discharges, and improving water quality monitoring programmes (among others). However, implementation of actions will depend on the availability of funding and sustainability of the responsible institutions.

The legal, regulatory, policy and institutional environment in Ukraine is in the process of becoming more aligned with the EU Water Framework Directive. Work to streamline and clarify roles and responsibilities of institutions and establish long-term policy objectives will help align Ukraine with the EU’s water management directions.

Broadly, Ukrainian water policy can be seen through two interconnected ‘policy avenues’, the first being around the rational use of water resources and quantitative restoration and the second being focused on quality aspects combating and preventing pollution. Various policies and strategies underpin these policy avenues. Until 2020, the Law of Ukraine "On basic principles (strategy) of the environmental policy of Ukraine till to 2020" served as the main prerequisite for obtaining EU Sectoral Budget Support. The strategy proposed five strategic objectives including introducing IWRM according to river basin principles, developing and implementing a plan to reduce water pollution, and ensuring compliance with regulatory requirements.

Beside these strategies, the “Concept of Water Sector Reforming” was developed to establish a water market within Ukraine, separate the economic functions of water service supply from state water governance and establish the National Water Council. Long-term, the “Concept” aims to ensure equal access to WSS services and to achieve and maintain the ‘good’ ecological status of the various types of water bodies within Ukraine in alignment with requirements of the Water Framework Directive.

In 2020, the Ministry of Ecology and Natural Resources developed the Law of Ukraine "On basic principles (strategy) of the state environmental policy of Ukraine till to 2030" which more closely aligns Ukrainian and EU policy objectives. The law’s implementation process is supported by the National Action Plan for the period 2020 – 2025 (and the second stage 2026-2030) and will be evaluated against indicators outlined in the strategy. Objectives include maintaining a permanent dialogue with stakeholders in strategic decision making, defining functions on environmental protection and economic activity related to the use of natural resources, and implementing principles of good environmental governance. However, the uptake of the draft strategy and the “Concept of Water Sector Reforming” are dependent on the stability of the Ministry of Environmental Protection and Natural Resources and securing sustainable funding.

Ukraine’s natural resources have the status of public ownership, and this sentiment underpins Ukraine’s water legislation. The Water Code of Ukraine (2002) is the main piece of legislation driving Ukrainian water management and the 2017 updates to the Code aligned large parts of legislation with EU Directives. In accordance with the EU Water Framework Directive, legal changes to the Code (in 2017) defined legal provisions for moving towards IWRM and further establishing basin principles for water resource management. The main improvements were related to defining river basin districts and establishing river basin councils and procedures for RBMP development. The second major piece of water legislation is the Law of Ukraine ‘on drinking water, drinking water supply, and wastewater drainage’ (2017). The law stipulates the requirements of drinking water provisions, provides guidelines for receiving wastewaters in centralised sewage systems and includes penalties for exceeding norms, among other stipulations.

Direct action is not generally a component of Ukrainian legislation and actions are often delegated to lower legislative levels such as sub-legal and normative legal acts. This approach means that although high-level legislation may outline effective water management, subsequent lower-level acts may distort or counteract their effectiveness.

The regulatory framework of Ukraine contains six major regulations dealing directly with water management. The regulations cover pollutants and their permissible discharges, include guidelines for developing the river basin management plans, stipulate drinking water supply, provide guidelines for water monitoring and flood risk management plans, and contain directions for issuing permits for special water use. Although alignment between Ukrainian legislation and EU Directives has strengthened, regulation could be improved. Streamlining and clarifying wording of regulations could lead to stronger water management in practice.

Regarding Ukraine’s institutional framework, 11 major institutional bodies govern water management. The two principal institutions include the Ministry of Environment Protection and Natural Resources (MEPNR), and the State Agency of Water Resources (SAWR). MEPNR is the Institutional body responsible for implementing the Water Framework Directive, 2000/60/EC and the Marine Strategy Framework Directive, 2008/56/EC. Among other responsibilities, MEPNR formulates water policy, including approaches for RBMP development and implementation, delegating water permits, and water monitoring. The SAWR is the central apparatus implementing water policy for surface freshwater bodies. It is supported by oblast sub-divisions and basin departments. SAWR’s role includes, issuing water permits, managing water monitoring, and undertaking water reporting and accounting, among other duties. MEPNR and SAWR are supported by 13 River basin Councils which were established as advisory bodies.

Shortcomings hindering robust water management from an institutional standpoint include a lack of clear roles and responsibilities in practice, and a lack of data exchange between authorities. These shortcomings result in shifting onuses for carrying out objectives, and inefficiencies in information exchanges between monitoring institutions, ultimately hindering decision making.

The water policy outlooks aim to baseline the country policy framework and current progress and then define the long-term vision and aspirations to 2030. The outlooks aim to demonstrate the likelihood of the current policy framework to achieve the long term objectives and desired future state of the water sector, and through development of scenarios, identify opportunities for improving policy coherence and policy priorities that have the opportunity to improve the likelihood of success. Table 1.1 presents the scenarios developed for the three countries.

In addition to “baseline scenario” for Georgia, two scenarios are proposed:

  • In the full-reform scenario the draft Law on Water Resources Management would be adopted by the end of 2021, though will still require complementary normative acts or other pieces of legislation to address all of obligations within EU mandates. The full reform scenario aims to improve water resource management and ensure sustainable water use, reduce water resource pollution, and improve water quality and quantity monitoring.

  • In the alternative full-reform scenario, the draft law is similarly assumed be adopted by the end of 2021 and the same key activities are considered. The alternate scenario differs by recasting governmental strategic ambition and setting more realistic timeframes. The alternative sub-scenario also considers the probability that some infrastructural projects will not occur and adjust costs accordingly. Differences in the reform scenarios stem from concerns regarding the delayed adoption of the draft law and consequent activities, setbacks in wastewater treatment plant construction due to local resistance, COVID-19 restrictions, and prolonged tender procedures.

For Moldova, two scenarios are proposed in addition to the “baseline”:

  • In the “business-as-usual (BAU) scenario”, trends in water policy, management and investment continue. The scenario envisages some improvements in the IWRM system. However, they are not enough to achieve the 2030 targets set by national policy documents and EU commitments. Overall, the water sector development under the BAU scenario for water policy would leave Moldova ill-prepared to meet major challenges in the water sector.

  • The “optimal scenario” achieves robust and sustainable water management, fully aligning with commitments in EU directives and reaching water-related goals by 2030. The scenario envisages increasing the amount of water allocated to environmental uses. It would also connect all urban and most rural households to safely managed water systems. Finally, it would achieve greater social equity and environmental protection through both carefully designed but steady reforms in the water sector and sound government action. The scenario foresees reasonably higher prices for water and higher water-use efficiency than under the business-as-usual scenario, resulting in reduced consumption. Water would be dedicated to environmental uses, over time resulting in improved quantity and quality of water resources. This would increase reliability of supply for domestic needs, irrigation and production. The scenario envisages improvements to domestic water supply through universal access to safely managed water systems for rural and urban households, while addressing affordability issues. In the scenario, investments are well balanced between water supply and wastewater treatment measures. It introduces economic instruments and social incentives to improve water-use efficiency, conserve water and generate revenues that are re-invested into the water system in an inclusive and transparent manner.

For Ukraine, in addition to the baseline scenario, two scenarios are developed:

  • The “business-as-usual” scenario presumes only marginal alignment with the WFD. The scenario foresees persistent challenges with financing for water protection measures which will not be sufficient to establish the nine RBMPs required.

  • In the “future scenario”, Ukraine will ensure efficient water resource and environmental management nationally by 2030 by developing and implementing institutional and legal reforms in 2024. However, the development of the scenario depends on the availability of strategic policy documents. In this scenario, amendments to the Water Code will provide a solid base for the WFD’s provisions. Further, it will develop an appropriate organisational structure for integrated water resources management at both central and basin levels.


← 1. Within the GEF-financed project “Enabling transboundary co-operation and integrated water resources management in the Dniester River Basin”, implemented by OSCE.

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