The World Bank Board of Executive Directors has approved an International Development Assoc-iation (IDA) credit of US$200 million to support the Federal Government in increasing the supply of potable water to the inhabitants of Lagos and Cross River States. The credit is provided on standard International Development Association (IDA) terms, with a commitment fee of 0.35 percent, a service charge of 0.75 percent over a 40 year period of maturity, which includes a 15-year grace period. The Second National Urban Water Sector Reform project’s principal development objectives are to: improve reliability of water supply produced by the water treatment works in Lagos, in order to increase capacity and hours of operation; increase access to piped water networks in four cities in Cross River State; and improve efficiency in order to reduce the cost of urban water utilities in Cross River and Lagos States. “The Project will vastly improve the amount of water available to consumers in Lagos and the cities of Calabr, Ikom, Ogoja and Obudu in Cross River States”, said Alexander McPhail, theWorld Bank’s Task Team Leader for the project. “For example, it will rehabilitate the treatment works and five distribution zones in Lagos and add 50,000 new water connections in Cross River State Capacity building is also an important project objective, where over US$2.0 million will be earmarked for training and core technical assistance for the two utilities.” The Second National Urban Water Sector Reform project has four components: The first component, Rehabilitation and Network Expansion (75 percent of the total project costs), will help support new works and equipment to ensure that the water utility customers receive increased access and more dependable delivery. The second component, Public-Private Partnership Development (4% of the total project cost), will support the sector’s ongoing public-private partnership development, with the objective of an enhanced customer focus and commercial orientation in the Lagos State Water Corporation and Cross River State Water Board. The third component, Service Sustainability (8 percent of the total project cost), will complement the technical and operating improvements to facilitate self-sustainability, increased efficiency and improved reliability of water supply. The fourth component, Institutional Development and Policy Reform (3 percent of the total cost), will strengthen the key sector skills, including technical operations, commercial operations, regulation, plus river basin development, and also track the nation’s progress in meeting the Millennium Development Goals for access to potable water and improved sanitation.