Cost-Benefit Analysis for Investment Decisions: Chapter 20 (Restructuring The Water And Sewer Utility In Panama)
AbstractIn the 1980s, investments in Panamaâ€™s water supply and sanitation sector centered on expanding the system capacity to meet the growing demand. However, since the facilities were constructed, maintenance had been neither fully performed nor properly programmed and maintained. As a consequence, the water supply and sanitation systems were inefficient and functioning under serious constraints. To remedy these shortcomings, the Panamanian government, with the support of the Inter-American Development Bank (IADB), launched the Public Enterprise Reform Program for the water supply and sewerage sector. The programâ€™s objective was to scale back the public sectorâ€™s role and to promote the participation of private operators in service delivery. The program, in particular, aimed to strengthen the Instituto de Acueductos y Alcantarillados Nacionales (IDAAN), the public utility responsible for providing water supply and sanitation services by rationalizing its staff, outsourcing support activities to the private sector, and collecting outstanding accounts. This chapter explains how the results of the financial and economic appraisal of a program aimed at improving the overall efficiency of the water utility with no expansion of coverage can differ significantly when viewed from different perspectives.
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Bibliographic InfoPaper provided by JDI Executive Programs in its series Development Discussion Papers with number 2011-20.
Length: 53 pages
Date of creation: Aug 2011
Date of revision:
Financial Appraisal; Economic Appraisal; Stakeholder Analysis; Economic Value of Water; Concessionaire; Economic Cost of Foreign Investment;
Find related papers by JEL classification:
- H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
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- Dinwiddy,Caroline L. & Teal,Francis J., 1996.
"Principles of Cost-Benefit Analysis for Developing Countries,"
Cambridge University Press, number 9780521479165, April.
- Dinwiddy,Caroline L. & Teal,Francis J., 1996. "Principles of Cost-Benefit Analysis for Developing Countries," Cambridge Books, Cambridge University Press, number 9780521473583, April.
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