Cubango-Okavango River Basin Fund

Overview

The Okavango Delta is globally recognised as a biologically rich and valuable ecosystem, as demonstrated by its status as a Wetland of International Importance (Ramsar site), UNESCO’s 1,000th World Heritage Site, and the centrepiece of Botswana’s vibrant tourism. The Cubango-Okavango River Basin (CORB) ecosystem is currently nearly pristine, a global rarity in the 21st century among large rivers.

The CORB Fund is a hybrid fund (sinking and endowment vehicles) that aims to enhance livelihoods and provide equitable benefits to its member states (Angola, Botswana and Namibia). It achieves this by implementing interventions that improve the resilience of critical ecosystem services in the river basin – to the threats of climate change and increasing resource demands from its inhabitants.

Investment request

Sinking fund: US$16.5 million

Endowment vehicle: US$200 million

Capitalisation plan:

  1. The first phase – the ‘demonstration phase’ – will target an investment of US$16.5 million that may include one-off US$0.5 million payments from each member state and a US$15 million commitment from bi-lateral development partners. The sinking vehicle is designed for a five- to seven-year lifespan.
  2. The second phase – the ‘fundraising phase’ – will likely commence after two years when the Fund has developed a track record. In this phase, high net-worth individuals, foundations, corporates and impact investors will be targeted to endow the Fund with US$200 million, or more.
  3. Once the initial target of US$100 million has been reached, the third ‘investment phase’ will commence and the Fund will continue its fundraising efforts to reach the US$200 million target.

Main sponsor(s)

Private sector: The Nature Conservancy: US$150,000 for the Fund’s value proposition

Public sector: Governments of Angola, Botswana and Namibia, represented by the Permanent Okavango River Basin Water Commission

Key facts

Water infrastructure type

  • Community water supply and sanitation.
  • Water-wise conservation agriculture.
  • Source water protection.

Country(ies), location

Angola, Botswana and Namibia

Transboundary basin

Cubango-Okavango River Basin

Development impact

  • Reduced abject poverty
  • Access to improved water and sanitation
  • Improved mobility and access to markets
  • Enhanced catchment and aquatic environments and increased climate resilience of communities

Financing requirement

Capital expenditure

Projected annual project spend: Year 1: US$1–2 million; an average of US$3 million per annum thereafter.

Project preparation

US$500,000 up to establishment; an average of US$300,000 per annum thereafter.

The Fund shall support livelihoods and conservation interventions. Examples of livelihoods interventions include:

  • Conservation agriculture (tillage, irrigation and natural fertiliser).
  • Rural water supply and demand management.
  • Potable water communal sanitation infrastructure.
  • Solar water heating systems.
  • Small-scale biogas systems.

Examples of conservation interventions include:

  • Fire management.
  • Protection of critical wetlands and woodlands.
  • Erosion control.

The Fund will be registered as a company limited by guarantee in Botswana, and will operate on two levels:

  • Members, who act as shareholders of the company.
  • A board of directors, which supervises the undertaking of the business and affairs of the company.
  • Growing populations and the increasing impacts of poverty that undermine the long-term sustainability of the CORB ecosystems.
  • The status quo is not sustainable. Achieving the Fund’s aims requires solutions that can address poverty while increasing the resilience of the ecosystem.
  • Extensive diagnostic studies show that the CORB is under substantial threat from climate change and human activity.
  • Freshwater sources are most at risk since there is no substitute for the Basin’s watercourses and aquifers.
  • The Basin is unlikely to maintain the quality of ecosystem services it offers its inhabitants in the future.