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Private Sector Participation in Water Supply and Sanitation in Latin America


  • Emanuel Idelovitch
  • Klas Ringskog


The water and sanitation sector in Latin America and the Caribbean is facing a crisis of confidence. The return of cholera to the region in 1991 was a symptom of deep seated problems and exposed the fragility and inadequacy of publicly operated water supplies and sanitation systems. Despite substantial efforts to improve the quality and coverage of service, one quarter of the urban population is not connected to a public water system, half lacks public sewerage, and the sewage is virtually untreated. The results are a constant threat to the health of the entire population, a perpetuation of unmet basic needs of the poor, and a steady deterioration of the environment. In recent years, private sector participation in water and sanitation has been a topic of discussion among various countries in Latin America, as evidenced by the large attendance at a number of regional seminars organized by the Technical Department of the World Bank's Latin America and the Caribbean Regional Office. These seminars have shown that virtually all public water companies are interested in cooperating with the private sector. Some have advanced further and have already involved the private sector in their operations in one way or another. The seminars have catalyzed the pursuit of greater private sector participation and the evolution of privatization models adapted to the institutional realities of Latin America and the Caribbean. This publication incorporates some of the insights gained at these seminars and is aimed at assisting the decisionmaking process that many countries face. The publication consists of two chapters. In the first¾Options for Private Sector Participation¾the main problems of the public sector are analyzed, the rationale for private sector participation (PSP) is explained, and the array of options for PSP is reviewed. In the second chapter Case Study: The Buenos Aires Concession the large concession for the Greater Buenos Aires water supply and sewerage services awarded by the government of Argentina to a private consortium of foreign operators and local investors is presented and analyzed, because it provides an excellent example of the planning and implementation stages that are needed to ensure a successful transition from public to private management.

Suggested Citation

  • Emanuel Idelovitch & Klas Ringskog, 1995. "Private Sector Participation in Water Supply and Sanitation in Latin America," Reports _017, World Bank Latin America and the Caribean Region Department.
  • Handle: RePEc:wop:bawlad:_017

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    2. Deardorff, A.V., 1989. "Economic Perspectives On Dumping Law," Working Papers 240, Research Seminar in International Economics, University of Michigan.
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    Cited by:

    1. Sylvy Jaglin, 2001. "L'eau potable dans les villes en développement : les modèles marchands face à la pauvreté," Revue Tiers Monde, Programme National Persée, vol. 42(166), pages 275-303.
    2. Guisan, M.C. & Aguayo, E., 2007. "Health Expenditure, Poverty and Economic Development in Latin America 2000-2005," International Journal of Applied Econometrics and Quantitative Studies, Euro-American Association of Economic Development, vol. 4(2), pages 5-24.
    3. Kerf, Michel, 2000. "Do state holding companies facilitate private participation in the water sector? evidence from Cote d'Ivoire, the Gambia, Guinea, and Senegal," Policy Research Working Paper Series 2513, The World Bank.
    4. Johnstone, Nick & Wood, Libby & Hearne, Robert R., 1999. "The Regulation of Private Sector Participation in Urban Water Supply and Sanitation: Realising Social and Environmental Objectives in Developing Countries," Discussion Papers 24142, International Institute for Environment and Development, Environmental Economics Programme.
    5. Herrera, Veronica & Post, Alison E., 2014. "Can Developing Countries Both Decentralize and Depoliticize Urban Water Services? Evaluating the Legacy of the 1990s Reform Wave," World Development, Elsevier, vol. 64(C), pages 621-641.
    6. World Bank, 2006. "Approaches to Private Participation in Water Services : A Toolkit," World Bank Publications, The World Bank, number 6982, June.
    7. Philippe Marin, 2009. "Public-Private Partnerships for Urban Water Utilities : A Review of Experiences in Developing Countries," World Bank Publications, The World Bank, number 2703, June.
    8. Mike Garn & Jonathan Isham & Satu Kahkonen, 2002. "Should we Bet on Private or Public Water Utilities in Cambodia? Evidence on Incentives and Performace from Seven Provincial Towns," Middlebury College Working Paper Series 0219, Middlebury College, Department of Economics.
    9. Klein, Michael, 1996. "Economic regulation of water companies," Policy Research Working Paper Series 1649, The World Bank.

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