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International collaboration in water management: water as unifying concept

Cooperation in the field of public audit is the main theme of this ECA Journal. But how does cooperation look like in other areas? What is the approach to cooperation in another area that is clearly vital for everybody: water? Professor Wim van Vierssen, previously CEO of KWR Watercycle Research Institute and current vice-president of the Water Supply and Sanitation Technology Platform, has worked almost his whole life with issues related to water. In this ECA Journal Long Read, he presents specificities of the water sector at large and how such a cross border issue as water, often organised locally, has led to multiple cooperation efforts, with success. And he also makes the link with the role of the EU and of public sector audits in this area.

By Professor Emeritus Wim van Vierssen, member representative of KWR Watercycle Research

Water is vital

Water plays a fundamental role in society because we, as humans, are directly dependent on healthy and safe water for our health and survival. We also wish to live in a safe and secure environment in which we are well protected from floods, for example, but in which we are also able to take effective action against water shortages in times of extended drought. Such shortages could threaten the water supply for drinking water production, industry, agriculture and energy (cooling water). In short, water management has been inextricably connected to human welfare since time immemorial.

With all these connections, it is clear that good water management needs to be accompanied by efficient collaboration at multiple levels: local, regional, national and international. To understand Europe’s role and how we have given institutional form to our water sector it would be useful to review a number of its features. This will show that Europe, at the EU level, plays an important coordinating role.

Ancient Mesopotamia, around 3000 BC, provides a useful historical milestone to mark the beginning of water management. It had a system in which urban development and relatively advanced agricultural irrigation and wastewater management went hand in hand. But the first real treatment of wastewater was only instituted in the 18th century. It then developed rapidly after the industrial revolution and the resulting urbanisation.

ECA Journal short read

Municipal water utilities remain the norm — the rise of large professional organisations has contributed to growth in the water sector. However, small and local water utilities remain the norm.

Cooperation at multiple levels — water management requires collaboration at multiple levels. At international level cooperation concerns the basic technical-scientific principles upon which good water management has to be founded.

Public supervision is crucial — water infrastructure is mostly financed publicly or by private stakeholders and managed under tight government supervision. Supreme audit institutions, including the ECA, play an important role in ensuring standards and compliance.

Good governance as the unifying concept — the water sector is connected with a numerous other sectors. And water does not respect frontiers. Good governance is key to the water sector and vital to addresssing water’s many uses.

EU as a global innovation engine — the EU has acted as a stimulus to the water innovation landscape with programmes such as Horizon 2020 and its Framework Programmes, inspiring partnerships, network development and knowledge sharing.

But it was not until the mid-19th century that we began to fully comprehend how untreated wastewater could cause massive mortality. The observational acuity of John Snow — a ‘physician-researcher’ we would say today — played a central role in this discovery. He suspected that there was a link between people’s use of a water pump on Board Street in London and a raging cholera epidemic. The pump, which was connected to a water source contaminated by the cholera bacteria, was the local contamination source and its users spread the infection.

We now know that from a historical perspective access to safe drinking water has been central to ensuring a healthy population — and actually more so than the availability of antibiotics, for instance. Healthy water is therefore a key element in human welfare.

Water: think globally, act locally!

The history of water management reveals two of its main dimensions: the global and the local. The global — and thus the international — concerns the basic technical-scientific principles upon which good water management has to be founded. The second, local, dimension is the one within which the technical provisions have to be shaped. In the water sector this always involves issues concerning, on the one hand, water availability (too much, too little, sufficient) and, on the other, water quality (clean or dirty, more or less calcareous, more or less arsenical, etc.). After all, there are very different requirements concerning water quality, depending on the large number of different users -humans, nature, industry, agriculture, etc.

Since the International Conference on Water and the Environment (1992, Dublin), the water sector has also considered water management in terms of Integrated Water Resources Management (IWRM). Such management is defined as ‘a process which promotes the coordinated development and management of water, land and related resources, in order to maximize the resultant economic and social welfare in an equitable manner without compromising the sustainability of vital ecosystems.’ The concept is based on three main principles: social equity (equal access for all users), economic efficiency (benefit optimisation) and ecological sustainability (acknowledgement of aquatic ecosystems as water users).

One of the key international players helping to disseminate this concept is the Global Water Partnership (GWP), a worldwide network of more than 3000 organisations in more than 180 countries. All of these organisations are engaged in promoting and facilitating the implementation of IWRM. Over the last 50 years, this conceptual development has led many users to organise themselves — locally, nationally and internationally — around the theme of water, as a central factor in society. In this context we frequently distinguish between the so-called ‘large’ and ‘small’ watercycle.

By the large watercycle we mean the hydrological cycle that water follows in its natural course from evaporation from the sea, to precipitation, and to its return to the sea via a river, surface runoff or subsurface runoff. In the world of this watercycle we need to ensure, through the construction of infrastructure (river embankments, dams, weirs and dikes), our constant access to sufficient water supplies, but also our protection against any threat of flooding. It also provides the framework within which we act to prevent the desiccation of nature and to supply the water that agriculture needs.

Figure 1 illustrates the case of the Netherlands, which has a water shortage in summer although it has an annual water surplus. In an increasing number of cases Aquifer Storage and Recovery (ASR) bridges the supply gap. In most cases, it is the national governments that bear an important responsibility in providing enough water year round.

Figure 1: Annual mismatch between water supply (precipitation) and demand in Rotterdam, the Netherlands. Source: KWR Watercycle Research Institute.

By the small watercycle we mean the technical cycle in which water, via a number of treatment steps, is prepared for human and industrial use, and is transported to the customer through distribution networks. But it also encompasses the subsequent steps, in which the used water is retreated, recycled or returned to nature. This is the interconnected world of the drinking water utilities and of wastewater management.

Against the background of these two interwoven watercycles, a large number of applied science fields, such as hydrology and ecology, but also civil engineering, have experienced extremely rapid development over the last 75 years.

Developments in the water sector since WWII

The water sector has grown steadily since World War II. Of course, the need to repair war damages provided a major impetus, but so did the need to develop new water infrastructure for a Europe that was industrialising with an expanding population; a population that has over the decades increasingly settled in urban environments with central drinking and (a little later) wastewater provisions.

Interestingly, the scale to which the water sector has grown mirrors the above developments. As we will see, despite the emergence of large professional international organisations, the water sector itself is essentially characterised by its small scale and local nature. Many European member states — with the exception of a number of their large cities — still have predominantly small, local drinking water or wastewater utilities. Moreover, they are still often in public ownership. The municipal water utility in fact remains the norm.

Germany, for instance, has about 6000 water utilities — Wasserwerke, the majority of which are municipal and public, although there are also public-private ones. In this regard, cities like Berlin and Hamburg are renowned for their large and very innovative public, municipal utilities. But, on average, large countries such as Germany still have very many small utilities.

One can define drinking water provision as ‘local’ when the needs of 13,500 residents are met by a single drinking water plant.

In contrast, a small country like the Netherlands, as a delta metropolis, has experienced a major sectoral consolidation in which the more than 200 water utilities that existed shortly after the war were reduced to today’s 10 (for a population of more than 17 million). One could say that Dutch drinking water production is actually regional rather than local in nature. However, although drinking water provision in many European member states may sometimes be organised regionally, much more often, it is still organised locally. This is not so surprising in view of the geographical diversity (for instance dry vs. wet, lowlands vs. highlands), and the fact that preferences for public and/or private ownership frequently depend on political factors. The situation with regard to wastewater management is not that different.

The formulation of the IWRM principles means that the quest for cohesion in water management is being pursued everywhere and more intensively than ever. This is not a simple challenge, in light of the fact that we in Europe already have tens of thousands of entities whose activities focus on the small watercycle. And it calls for cohesion and tailored governance. This is not unique to Europe. The situation in the United States with regard to dimensions is not very different. There is good reason that an organisation like the National Rural Water Association (NRWA) has attracted a membership of over 30,000 non-city water utilities and small utilities, offering them advice and support.

Supervision and Control

In all of this, public supervision is crucial. Much of the water infrastructure, and therefore the associated management, is either publicly financed or financed by private stakeholders, who conduct their water-related activities under tight government supervision, passing on the costs to the customer (on the basis of tightly regulated rates). Of course, this raises questions of both effectiveness — Is the service provision up to standard? — and of compliance — Are the agreed financial terms respected? Here national audit offices often play a key role. The same naturally applies at the EU level, where this function is performed by the ECA.

This auditing role is clearly illustrated in a number of examples taken from both the large and small watercycles. In the United Kingdom, the National Audit Office assessed the privatised water sector in a 2015 report entitled: ‘The Economic Regulation of the Water Sector’. In general terms, the water sector in England and Wales, which was privatised in 1989, functions under the supervision of the Department for Environment, Food & Rural Affairs. More specifically, with regard to the rates system, supervision is carried out by the Water Services Regulation Authority (Ofwat), which is also responsible for monitoring the performance of the privatised companies.

This monitoring role is of extreme importance, particularly in a situation in which the traditional public tasks, such as water provision and water safety, are transferred to private hands. The private performance of these tasks does after all frequently elicit public debate and sometimes even unease. In such cases, an independent, non-politically-motivated supervision of the agreements often provides an objective framework and is useful for an orderly debate.

A good example from the large watercycle is the recent (2017) audit of the Netherlands Court of Audit regarding the expenditure of what is known as the Delta Fund. This national fund finances the measures that need to be taken in the Netherlands, as a low-lying delta metropolis, with regard to water safety (problem: flooding) and the supply of freshwater (problem: water scarcity). In 2017, this amounted to expenditure of almost € 1 billion. Such a huge amount means that the parliament and the public would like to be kept informed of the investments.

Such supervision is provided for, and very openly carried out, at EU level as well. In the case of the water sector and its societal function, the ECA plays an important role in monitoring spending, for instance, on the implementation of the Drinking Water Directive. One example is ECA special report 12/2017, which was produced ‘to determine whether or not all of the Drinking Water Directive’s parametric values are being complied with’ by Hungary (EU accession in 2004), Romania and Bulgaria (EU accession for both in 2007). This is hugely important for EU citizens, but certainly also for the EU water sector. After all, by international standards, the bar is set very high for this sector. Preserving high-level water provision is therefore not only important for the citizen and for the water sector itself, but also for the associated business community which has to confront the challenge of innovation.

Another example illustrates the control of the way in which policies in different areas, such as water and agriculture, are harmonised at the level of the EU. We know that, worldwide, about 70% of water-use is related to agriculture. In Europe this figure, above 30%, is also significant. Moreover, the Common Agricultural Policy (CAP) will probably account for almost 40 % of future EU’s budgets — all good reasons for examining the consistency of measures taken in these two important policy areas: water (health) and agriculture (food). In this regard, ECA special report 4/2014 on the theme of ‘the integration of EU water policy objectives with the CAP’ is enlightening: there is room for improvement.

Water as a complex organisational challenge

It has therefore become clear over the last decades that water is an important binding element in society. Not only because people themselves need healthy water for a healthy life, but also because water is an important factor of production in the agricultural, energy, transport and industrial sectors. Furthermore, in many societies the water sector has developed to become a very high-quality technological system. This involves not only water-related infrastructure, but also the associated governance: from small water utilities to regional, national and even international river basin management organisations.

A good example of the latter is the International Association of Water Works in the Rhine Basin (IAWR), a collaboration of Austrian, German, Swiss, Dutch, French and Liechtenstein water utilities set up in 1970 encompassing the entire Rhine basin — in effect, the entity was established to safeguard the basin as a healthy source of water for the drinking water sector. In 1994, with a view to supporting this kind of organisation in their shared objectives, the International Network of Basin Organizations (INBO) was established. The specific objective was to bring about the collaboration of basin organisations in different countries.

One sees such organisational ‘stacking’ in many sectors, but primarily in the water sector, because water does not respect frontiers and the healthy-water theme is something that connects humans worldwide. National water umbrella organisations are also increasingly organising themselves in international contexts, forming umbrella organisations for umbrella organisations. EurEau offers a good example. Established in 1975 as the European Federation of National Water Services, it represents national drinking and wastewater service providers from 29 countries, from both the private and the public sectors.

The growing prominence of water as a societal factor has also been at the origin of a number of global cooperation initiatives, transcending the national and regional. They are not the result of the bundling of national initiatives, but constitute international initiatives in themselves. They have been shaped from four different perspectives with regard to water.

Four kinds of water perspective

The technical-scientific perspective: in 1999, the International Water Association (IWA) was established, an organisation with a focus on all aspects of the watercycles and the product of the fusion of a number of international water organisations set up in the decade following World War II. Today, the IWA numbers 10,000 individual members besides a large group of institutional members from both the private and public sectors.

The sectoral perspective: the World Water Council (WWC), which was set up as a thinktank and institutional action group by private initiative in 1996, constitutes an important multi-stakeholder platform for the international water community. One key WWC instrument is the World Water Forum, which has been organised somewhere in the world every three years since the first in 1997 in Marrakech (Morocco).

The Forum has grown to become a mega-event, typically attracting tens of thousands and sometimes more than one hundred thousand visitors (Forum+Fair+Expo). It is the most comprehensive gathering in the field of water, boasting a wide variety of participants. It is used as a podium by small grassroots organisations, SMEs, but also by multi-utilities, multinationals, governments and politicians (in the form of the ministerial water conference). One European, annual variant to this is the Stockholm International Water Week (SIWW), which is smaller in scale, and more oriented towards science than the public. It has a science committee which sets out its annual themes.

The societal perspective: water has been attracting more and more attention from this perspective. For example, in the eight Millennium United Nations Development Goals (MDGs) of 2000, water still had a relatively modest presence as part of MDG 7 (Ensure Environmental Sustainability). By 2015, in the UN’s 2030 Agenda, with its 17 Sustainable Development Goals (SDGs), water had become a prominent, explicit component: SDG 6 is entitled ‘Clean Water and Sanitation’. Water is also an inseparable part of, and sometimes a prerequisite for, a great number of other SDGs, such as those concerning Sustainable Cities and Communities, Responsible Production and Consumption, Climate Action, but also Life under Water, to mention the most obvious ones.

The economic perspective: water is an important factor of production. In the programme of the European Management Forum, established in 1971, and the later World Economic Forum (WEF, the name was changed in 1987), concern for the environment played practically no role at first. The main impulse was to improve the quality of European business management and to better anchor businesses in society.

Since the Forum became formally recognised as an international organisation in 2015, it can be seen as a global platform for public-private economic collaboration. Moreover, WEF’s Global Water Initiative (GWI) has made water the focus of much attention. Importantly, a number of leading large companies — for example, Grundfos, Nestlé and Coca-Cola — but also organisations such as the Swedish International Development Cooperation Agency (Sida) have committed themselves to the global water agenda. The question of course is whether this initiative will manage to connect with the many other initiatives such as those described in this article.

Water Technology trade fairs

The Water Technology trade fairs must also be mentioned within the economic perspective. They are frequently a mirror of developments in policy: new norms and standards often immediately result in new technological solutions and products. In this regard, the Singapore International Water Week (SIWW) stands out. The SIWW only began in 2008, but it has evolved extremely fast and made Singapore a global water hub. The process has been driven in particular by Singapore’s huge water challenges which, combined with its creditworthiness and determination, have resulted in the creation of a superb practical space for experimentation. This context has attracted many innovative companies from the global water sector, which, in a blink of an eye, have produced a compelling mix of research, development and market.

Does Europe have a response to this mix? Absolutely, when it comes to water technology. Aquatech (water technology, Amsterdam, the Netherlands) and IFAT (environmental technology, Munich, Germany) are European trade-fair showpieces in the environmental area. And one can see that these trade fairs are acquiring a policy and political bent. T Dutch Aquatech fair has now established a partnership with the Amsterdam International Water Week (AIWW), which, for example, also has the global water challenges related to the SDGs on its agenda.

Despite all this, what is really lacking in Europe is that golden operational mix of societal need, R&D and implementation capacity. In terms of power of implementation and perseverance, Europe can’t hold a candle to the city-state of Singapore. We like to keep business at arm’s length from politics, and are not interested in such a close interweaving of the two as in Singapore. This, at a time when global demand for innovative water solutions is huge and Europe still holds the lead in R&D. But there is a relative lack of experimental space at the European level. An experimental space with ambition and determination and, importantly, a pact between government and business to provide the practical means to fulfil such ambition.

Unifying concept

The question then becomes: what is the overarching concept that can set all these initiatives in context, that can even unify them?

Actually, as the water community, we are in general agreement about this: the unifying element is good governance. Good governance is the key factor, because water has become a unifying societal subject, a subject that affects all sorts of societal issues and the associated problems and actors. It therefore came as no surprise that this conclusion was among the most important outcomes of the World Water Forum in 2012 (Marseille). A very significant conclusion, when you consider that the water sector is highly fragmented and connected with numerous other sectors, such as agriculture, health, safety, industrial development, energy and spatial development. In addition, water does not respect frontiers and the sector is characterised by its many multi-level governance issues.

In 2013, the Organisation for Economic Cooperation and Development launched the Water Governance Initiative (WGI), which in 2015 led to the formulation of a number of Principles on Water Governance. The WGI has three important objectives: efficiency, effectiveness and trust & engagement, and twelve principles which support the formulation of tailor-made water solutions for each situation. For the time being, this initiative is an important milestone in a process that has been evolving since the establishment of the WWC in 1996.

The European Union as a global innovation engine

Naturally, European players have contributed to all these developments, either individually or within their international umbrella organisations as described above. But there has also been an associated EU effort nested, as it were, within the ensemble of international developments. EU programmes, such as Horizon 2020 and its predecessor Framework Programmes for Research and Technological Development (FPs) in particular, have helped shape and structure the water innovation landscape.

It is striking in this context to observe how since 1984 (the first FP) the number and variety of the participating organisations has surged (Figure 2). A total of almost 7 800 individual water-related organisations have taken part since FP1. In FP1 there were 198 participants, a figure that rose to over 1300 in FP7.

Figure 2: Share of type of participants in EU research and development programmes based on their water related contributions and scientific output. Source: Pieter Heringa, 2015.

A breakdown of the participants by category (Consultancy, Education, Government, Industry, Non-profit, Other, Research) shows that the joint share of the dominant categories of Education and Research (over 75% in FP1) dropped to under 50% in little more than 30 years. In this regard, water-related projects contrast with FP projects generally, in which these categories’ dominance has persisted. For water-related projects, the participation of Industry over the same period doubled from about 15% to 30%, while the Government category remained stable (5%), as did the categories Non-profit and Consultancy (<5%).

In a general sense, one can say an FP water network is small in scale and has a relatively high degree of network clustering. The latter is a measure of the probability that if, for example, stakeholder A works with stakeholders B and C, these last two will also work together in another setting. Although the European water sector may be small-scale and fragmented, the Framework Programmes have clearly stimulated coalition formation, network development and knowledge sharing. This is a closely-knit sector in which people tend to know each other well. The European Commission’s Directorate General Environment has also made a major contribution to knowledge sharing and network formation through the creation of the European Innovation Partnership (EIP) Water. This is done by facilitating Action Groups, which today number about 29. Their task is ‘to develop, test, scale up, disseminate and stimulate the uptake by the market of innovative solutions to water-related challenges.’

A significant number of stakeholders that are active both in the Framework Programmes and in EIP Water are also members of the Water Supply and Sanitation Technology Platform (WssTP), one of the EU Technology Platforms. Established by the Commission in 2004, WssTP became an independent foundation in 2007. Its principal objectives include innovative water technology, a competitive water sector, a European response to global water problems, and a contribution to the challenges in the ambit of IWRM.

With just under 200 institutional members, the platform is currently concentrating, through working groups and clusters, on elaborating the European water challenges through the WssTP Vision and Strategic Innovation and Research Agenda (SIRA), and also on advancing the position of European companies in the global water market.

Through three annual outreach activities (Water Market Europe, Water Innovation Water and Water Knowledge Europe), WssTP also supports the water sector in the fields of Market Development and Innovation Management, and in shaping Knowledge Coalitions, within the Framework Programmes for instance. And, more recently, WssTP has also begun facilitating relations between the European Union and third countries through its International Water Dialogues. The aim is to enrich these relations with substantive sector knowledge and skills from the field of water technology. One example is the China Europe Water Platform (CEWP).

The way forward

It is fair to ask what all this has given the EU. In any event, a home-market of over 500 million citizens who all benefit from water services that are properly monitored and tightly regulated, in terms of quality and price. But also a water sector that develops top-quality technology. The water sector is, as a whole, a highly performing technological system whose utility actually extends beyond the provision of water services. It is, after all, a system in which a large number of companies are active and, together, represent an enormous innovation capacity. What lessons can we now draw from this with regard to our organisational capability when it comes, for instance, to the opportunities present in the global water market for the European business community?

In broad outline, we see the following European instances of collaborations placed on different rungs of the Technology Readiness Ladder (TRL), which is a means of positioning different types of knowledge products in terms of their distance from the market (the levels range from 1 to 9, with basic research placed at level 1 and market uptake at level 9):

  • at levels 1–3: Joint Programming Initiatives (JPIs) of European basic research. There is a specific Water JPI, ‘Water Challenges for a Changing World’, aimed at reinforcing national research efforts with European programme funding;
  • at levels 4–8: Clustering of R&D in Regional Innovation Centres. WssTP (see above) desires, as an EU institutional umbrella organisation for water, to support regional knowledge centres in the development of which many of WssTP members are involved. The ambition of all of these entities is to become leading regional innovation centres. Examples include initiatives in Aragon (Spain), Friesland (the Netherlands), Centre-Val de Loire region (France), Puglia (Italy), Central Denmark, South Western Finland, the Swedish North Baltic water district, the Basque region (Spain), the Hydro Nation (Scotland) and the region of Malta. Given their wide variety, the different centres provide a nice palette of multiple kinds of problems and solutions;
  • at level 9 and beyond (market). At this level we have to make a distinction between the experimental space that has been created primarily by public end-users in Europe, and the space that is directed at the private market;
  • creation of Public Communities of Practice. Among the most recent (2012) developments is for instance the creation of the Watershare collaboration model (see Figure 3 and text box), in which mainly public, knowledge-oriented end-users share their practical water-innovation experience within Communities of Practice.
Figure 3: An example of water network building with Europe as home-base. Source: Watershare.
  • creation of platforms for the commercial replication of innovations. Bringing innovations to the market is difficult. The ‘valley of death’ concept in the start-up world is all about this: research that succeeds but innovations that are not taken up by the market. In a number of the above-mentioned regional European knowledge clusters, a great deal of energy and enthusiasm is of course directed at generating new commercial activities. Wetsus (Friesland, the Netherlands) for example is a centre that is wholly dedicated to this objective, working closely with a dozen or so universities all over Europe. Another example is Allied Waters, an organisation in which a small number of stakeholders has, for example, succeeded in taking Subsurface Water Solutions — partly on the basis of the Horizon 2020 project referred to — to the heights of global market acceptance under the name SALutions.

Watershare consists of world-leading, mainly public water organisations teaming up in a member community to set standards and share best practices. Watershare involves a number of large stakeholders, such as the Public Utility Board (PUB) of Singapore, Aysa, the water utility of Buenos Aires (Argentina), Diam, the Public Authority for Electricity & Water (Oman), and the Japanese Water Research Center (JWRC), to mention only a few (see Figure 3 for all members). Naturally, the European members draw on many of the Horizon 2020 research outcomes in their participation. A good example is SubSol, the subsurface water solutions project (2015–2018, 15 partners), which forms the core of the set of tools that the Watershare’s Subsurface Water Solutions CoP implements.

Cooperation on water as model?

The water sector has been following with great interest the developments surrounding the new FP Horizon Europe, which has ‘mission-orientation’ as its governing theme. Based on the above, it should be clear that the water sector believes that there is every reason to designate water as a ‘mission area’. Societal considerations also point in this direction. Moreover, the combined top-down and bottom-up manner in which the global water agenda has been implemented over the years offers a good model for a possible successful cooperation approach. In this manner, Europe would at the same time send an important message to the global water technology market, which amounts to almost € 650 billion and is growing at an annual rate of almost 4%.

What would help us gain an objective view of how things stand in our sector is an independent study of the relation between our water R&D effort and our success on the world market. National preferences and ambitions naturally play a part in the formation of national opinion about the role and utility of the EU conquering the world water market. It is therefore an area in which the ability to regard matters objectively can have a beneficial influence on framing an informed dialogue and letting the facts speak for themselves. Public audit institutions, in view of their independence and increasing focus on performance issues, are ideally positioned to contribute to that. Here the ECA — probably in cooperation with national audit institutions — could play a positive and productive role.

This article was first published on the November-December 2018 issue of the ECA Journal. The contents of the interviews and the articles are the sole responsibility of the interviewees and authors and do not necessarily reflect the opinion of the European Court of Auditors.

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