Could the 'sponge city' approach prevent untreated sewage discharges?
I'd never heard of the Chinese notion of a 'sponge city' but it's not as odd as it sounds - and it's the opposite of the concretisation that characterises modern urban development. If the Chinese can make this idea work, to cope with monsoon conditions, then the idea should be capable of being exported to countries where extreme rain has drastic effects because the local infrastructure isn't designed to cope with occasional downpours.
On a small scale, this resembles the rain garden approach, where rainwater is used directly in the garden rather than being piped away to rainwater tanks and butts or down into the sewers. A well-designed rain garden can apparently absorb all the rainfall that falls on an average house.
So a true 'sponge city' should be able to absorb most of heavy rainfall, thus preventing the flooding of inadequate sewers, the overloading of water treatment facilities and thus the discharge of untreated sewage into rivers and the sea.
See eg https://www.bbc.co.uk/news/world-asia-china-59115753