Policy Note: Advancing Water Policy in Europe: Addressing Challenges in the Southeast Mediterranean within the Water Futures Project.

Water-system stress challenges driven by aridification, rapid urbanization and tourism peaks, irrigation-intensive agriculture, pollution, fiscal underinvestment and entrenched social inequities need integrated and adaptive policy responses. We present the Global Climate Hub's interdisciplinary approach along with an application framework that was developed under the ERC-funded Water Futures project, aiming to tackle such challenges: We couple cross-sectoral modeling (physical and natural systems, water-energy systems, and economics), digital-twin forecasting and real-time monitoring, with experimental-economics, behavioral-economics and Living Labs to allow stakeholders' feedback and solutions' co-design. Through regulated sandboxes and randomized trials, the project tests pricing reforms, behavioral nudges and technological pilots (IoT/AI leak detection, decentralized treatment, nature-based solutions), producing robust socio-economic narratives and distributional metrics to inform investment choices. Preliminary policy guidance urges an iterative evidence loop of modelling-valuation- Living Lab validation and solution co-design, supported by open data, toward equitable tariff design, targeted subsidies, matched innovation financing and capacity building to scale proven solutions. The proposed approach translates diverse theories into operational pathways for resilient, efficient and socially just urban drinking-water systems, offering a replicable blueprint for regions facing water scarcity. [ABSTRACT FROM AUTHOR]