Driving Water Efficiency Through Sustainable Finance in the Arab World
Water scarcity has long shaped the economic and social realities of the Middle East and North Africa. At the Development Finance Conference (MOMENTUM 2025) in Riyadh, that reality took centre stage as policymakers, financiers and development leaders gathered to rethink how capital can be mobilised for real-world impact.
Hosted by Saudi Arabia’s National Development Fund (NDF) under the theme “Where Development Finance Meets Action,” the conference highlighted the urgent need to align financing with the region’s most pressing constraints. Among the key voices was Dr. Abdallah Al Dardari, UNDP Assistant Administrator and Regional Director for Arab States, who called for a fundamental shift in how water is managed, financed and valued across the region.
The Water Paradox of the Arab States
Dr. Al Dardari laid out a stark paradox facing the Arab region. Despite being the most water-scarce region globally, nearly 70% of available water resources are consumed by agriculture, while countries remain heavily dependent on food imports.
This imbalance, he argued, is not just a technical challenge but a systemic one. The issue is less about absolute scarcity and more about efficiency, allocation and incentives.
Improving outcomes, he stressed, begins with improving efficiency. That means rethinking how water is used across food systems, how it is priced, and how investment decisions shape long-term sustainability rather than short-term output.
Water, Food and Climate: A Single System, Not Separate Silos
A recurring theme throughout the engagement was the need to move away from siloed approaches. Water security, food systems and climate resilience are deeply interconnected, particularly in arid and semi-arid regions.
Dr. Al Dardari emphasised that sustainable water use cannot be achieved through infrastructure alone. It requires integrated financing models that support climate-smart agriculture, efficient irrigation, resilient supply chains and adaptive technologies—while also protecting livelihoods and food security.
This systems-based perspective is increasingly shaping how development finance is structured across the Arab States.
UNDP and Saudi Arabia: Scaling Sustainable Finance for Impact
The discussions at MOMENTUM 2025 were anchored in UNDP’s long-standing collaboration with Saudi Arabia, particularly through its partnership with the Saudi Fund for Development and the National Development Fund.
This collaboration reflects a shared ambition: to design development finance that is scalable, investable and impact-driven. The focus is not only on domestic priorities but also on solutions that can be replicated across the wider Arab region and beyond.
Key areas of cooperation include:
Sustainable financing for water and food systems
SDG-aligned investment mapping
Blended finance and de-risking mechanisms
Technical assistance to crowd in private capital
Strategic Dialogue on the Future of Development Finance
During his mission to Saudi Arabia, Dr. Al Dardari also held high-level discussions in Riyadh with H.E. Dr. Stephen Groff, Governor of the National Development Fund. The dialogue explored how Saudi Arabia’s development finance architecture can play a larger regional and global role.
The conversations focused on leveraging UNDP’s expertise in blended finance to reduce risk, unlock private investment and convert policy ambition into bankable projects—particularly in water, food security and climate resilience.
UNDP reaffirmed its long-standing partnership with the Kingdom across sectors such as water management, environment, urban transport and economic development, while expressing strong support for NDF’s innovative development finance model.
Saudi Arabia’s Growing Role in Global Sustainable Finance
As Saudi Arabia strengthens its position as a hub for sustainable and development finance, the MOMENTUM 2025 dialogue signals a broader shift. The Kingdom is increasingly positioning capital not just as a source of growth, but as a tool for resilience, inclusion and long-term sustainability.
By aligning financial instruments with real development outcomes, Saudi Arabia and its partners aim to turn financing into measurable impact—supporting systems that deliver inclusive growth nationally, regionally and globally.
From Finance to Action
The message emerging from Riyadh is clear: sustainable finance in the Arab States must move beyond frameworks and commitments into execution. Water efficiency is no longer a technical footnote—it is a defining development challenge that demands smarter finance, better incentives and deeper collaboration.
As Dr. Al Dardari’s engagement underscored, the future of the region depends not just on how much is invested, but how wisely capital is deployed to protect its most precious resource.
