Declining Water Infrastructure Prompts AP7 Action

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Stockholm (NordSIP) – An apparent need to address Sweden’s water and sewage network has prompted AP7, the Swedish national pension fund, to position investment to deal with the issue.

“The water situation in Sweden is more serious than in decades. Authorities regularly warn about contaminated drinking water, floods and water shortage,” AP7’s chief executive Richard Gröttheim wrote in Dagens Industri, the leading Swedish financial daily.

There is a declining water infrastructure in Sweden, according to Gröttheim and the chief executive of SPP Staffan Hansén, in their co-written op-ed piece. The article calls for increased private investment in individual communes across the country despite opposition from political and other interests

National coordination is needed, the two men say. “It’s about long-term investments that require specialist competence and extend over many mandate periods.”

Private ownership of the country’s waterworks is not currently legal in Sweden.

“We would like to contribute with the funding,” Gröttheim and Hansén wrote.

In a preliminary report – “Water as an Investment” – AP7, together with AP3, Skandia and the Swedish Church, have identified some of the obstacles to improving the system. The investors are working together to meet the 6th UN SDG on the 2030 agenda, which calls for clean water and sanitation across the globe.

The funds themselves are attempting to illuminate the notion that despite the amount of capital available for the investment of infrastructure, there is not enough acknowledgement of the investment opportunities within water and sanitation. Not least by Swedish municipalities, who remain conservative in their approach due to indebtedness to other sectors.

One finding in the report was that local politicians rejected borrowing to stave off local debts. This naturally limits the private investment rate in water infrastructure projects as well.

“Water and sanitation is invisible infrastructure, which is expensive to maintain, and public awareness of it is low,” the managers suggest.

AP7 and SPP want to contribute to solving the problem.

Image © Ase – Shutterstock

 

 

 

 

 

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