African governments face growing pressure to strengthen the financing and governance of water, sanitation and hygiene systems after the African Union Commission and UNICEF placed WASH at the centre of the inaugural State of Africa’s Children report, highlighting persistent service gaps affecting a continent with nearly 691 million people under the age of 18. Released on 23 September, the assessment shows that decades of investment have expanded access to water and sanitation, but have yet to overcome large infrastructure deficits, particularly in rural communities and public institutions. Limited public financing, climate pressures, inequality and fragility are also complicating efforts to provide reliable services across households, schools and health facilities.
According to the African Union, 40% of children in Africa used safely managed drinking water in 2024, while 30% had access to safely managed sanitation and 38% had basic hygiene services. Since 2000, 161 million children have gained safely managed drinking water and 129 million have gained safely managed sanitation. A further 65 million children have gained basic hygiene services since 2015. Rural open defecation declined to 20% from 28% in 2015, although substantial disparities between rural and urban areas remain.
The figures underline a wider infrastructure challenge for African governments. Water and sanitation systems are long-lived public assets whose performance has consequences beyond the social sector, influencing healthcare costs, educational outcomes, urban productivity and the operating environment for households and businesses. Weak water and sanitation services can transfer costs elsewhere in government, particularly to public health systems, while unreliable infrastructure can make basic service provision more expensive in rapidly growing settlements. UNICEF’s 2026 WASH programme brief links inadequate services with waterborne diseases, increased healthcare costs and lost productivity.
The financing question is consequently becoming more prominent. The AU-UNICEF report calls for member states to increase and better target domestic public financing for WASH, prioritising countries with the largest populations of unserved children. It also calls for stronger national data systems and more transparent accountability mechanisms, alongside the integration of climate risk assessments and early warning systems into infrastructure planning. Those requirements are particularly significant for fragile and conflict-affected countries, where governments already face competing demands on limited fiscal resources.
The policy push comes as African development institutions seek to strengthen the pipeline of water and sanitation projects capable of attracting investment. The African Water Facility, administered by the African Development Bank, launched a 2026 call for proposals intended to improve the preparation of bankable water and sanitation investments. Grants of up to €1 million per project are available for work including feasibility studies, detailed engineering, environmental and social assessments, transaction advisory services and financial structuring.
Projects demonstrating co-financing, investor interest or a credible route towards subsequent funding receive greater consideration under the facility’s selection criteria. The approach addresses a persistent constraint in African infrastructure finance. Availability of capital does not necessarily translate into construction when projects have not progressed sufficiently on engineering design, regulation, environmental and social safeguards, procurement or financial structures. Project preparation can therefore determine whether governments and utilities can move from infrastructure plans to transactions capable of securing financing.
The African Water Facility’s framework encourages the use of blended finance, risk-sharing mechanisms, results-based financing, public-private partnerships and cost-recovery models, alongside governance improvements and measures to strengthen climate resilience. Sanitation is particularly difficult to finance because a significant part of the infrastructure sits at household level, including among communities with limited capacity to meet substantial upfront costs.
According to UNICEF, about 762 million people in Sub-Saharan Africa lack basic sanitation, while 193 million have no toilet and resort to open defecation. UNICEF’s Sanitation Programme Facility is testing whether donor-backed guarantees, lower-interest financing and technical assistance can bring commercial capital into household sanitation and small sanitation businesses. Pilots in Ghana, Nigeria and Togo have enabled $1.6 million in sanitation financing, according to UNICEF. The agency reports repayment rates reaching 97% in Ghana, while 80% of loans in Togo went to the poorest households.
The amount remains small relative to the region’s overall infrastructure requirements, but the financing structure illustrates a potentially important shift in how development capital is deployed. Instead of relying exclusively on grants to fund physical infrastructure, guarantees and concessional finance can be used to address barriers that prevent households and businesses from accessing credit.
For African governments, such models have implications for the allocation of scarce public resources. Where commercially supported finance can cover suitable household or small business sanitation investments, government expenditure can be concentrated on areas less suited to private finance, including large network infrastructure, regulation, public-health surveillance and services in schools and health facilities.
Debt-backed household financing, however, also increases the importance of affordability, consumer protection, transparent tariffs and effective regulation. Municipalities and utilities require sufficient institutional capacity to oversee service standards while ensuring that financing structures do not put essential services beyond the reach of poorer households. Climate risk adds another layer to the investment challenge. Drought can reduce water availability and put pressure on utility operations, while floods can damage sanitation infrastructure and increase the risk of contamination. The AU report consequently links future WASH planning with climate and conflict resilience, placing greater importance on infrastructure design, maintenance expenditure, emergency preparedness and risk assessment before financing is committed.
These considerations are becoming increasingly material as African governments balance infrastructure investment with constrained public budgets. A project that secures construction financing but lacks adequate resources for maintenance, climate resilience or institutional oversight can leave governments and utilities with long-term operational liabilities. The consequences are most visible in everyday public services. In schools, inadequate water and sanitation can disrupt attendance and learning. Health facilities require functioning WASH infrastructure to deliver basic services safely. For households, meanwhile, the time and money required to obtain water or cope with inadequate sanitation represent economic costs that rarely appear in formal infrastructure budgets but can affect household finances and participation in the economy.
The policy challenge is therefore broader than increasing WASH expenditure. Governments need to strengthen the chain linking public budgets, project preparation, financing, procurement and construction with the eventual reliability and affordability of services. The AU and UNICEF are calling for financing decisions to be supported by stronger data and accountability, while initiatives from development institutions are testing whether guarantees, concessional capital and improved project preparation can bring additional sources of finance into the sector. The distinction will matter as African countries confront competing demands for infrastructure, healthcare, education and climate adaptation within constrained fiscal space.
With the African Union’s 2026 Agenda placing greater political attention on sustainable water availability and safe sanitation, the measure of progress will ultimately be less about the number of financing instruments created than the ability of African institutions to translate capital into functioning assets. For governments, development financiers and utilities, the practical test is whether stronger project preparation and more diversified financing can produce investable projects, credible public budgets and water and sanitation systems capable of delivering reliable services in the communities where access remains lowest.
