He's letting the moisture evaporate so the meat can brown in the fat that remains - well-browned food has much more flavor because of the Maillard reaction. If he didn't, the meat would steam in the liquid and not develop as much flavor. The evaporation also leaves flavor compounds on the surface of the pan which are picked up by adding liquid - the water, beef base and tomato sauce - to the beef; this is known as deglazing. Hope this helps.
The trouble with eating Italian food is that five or six days later you're hungry again. ~ George Miller