Water Deregulation

Although the absolute figure looks large, the water and waste sector lags sadly behind other the infrastructure sectors in the private investment it receives. By the end of 2011, 743 PSP projects in 62 countries worth a cumulative total of $64,126 million had been closed in the water and sewage sector in developing countries and a further amount in developed countries. This amounted to only 4% of the cumulative global PSP investment total of $1,695 billion between 1990 and 2011. This also included telecommunications (45%), energy (34%) and transport (17%).

For water and sanitation, East Asia and the Pacific region received a total of $30.0 billion (or 47%), Latin America and the Caribbean $26.0 billion (or 41%), Europe and Central Asia $3.8 billion (or 6%), Middle East and North Africa $3.8 billion (or 6%), South Asia $355 million (or <1%) and Sub-Saharan Africa $266 million (or <1%). Between them, Asia Pacific and Latin America received just fewer than 90% of the entire expenditure in the water and waste sector from 1990 to 2011.

Over the past 20 years, investment in the water and sanitation projects averaged $2,978 million annually and $3.0 million per project. Investment has been erratic. Investment in South Asia and the Middle East has increased over the past ten years. By contrast no investment has been reported in Europe and Central Asia, though it should be noted that only a small number of these countries are classed as developing.

Likewise the number of reported projects has generally increased, with a drop in financing in 2009 and 2010. China accounts for the largest number of reported projects at 359; followed by Brazil with 81 projects; and Colombia with 51 projects.

There have also been increases in the number of reversals, especially in East Asia and Latin America. 63 PPI projects have been cancelled or were in distress, totalling $20.6 billion or 32% of investment by the end of 2011. 56% of this investment ($11.6 billion) was cancelled or in distress in East Asia and the Pacific region and 44% ($9 billion) in Latin America and the Caribbean.

The cancellations have not all been one sided, they have been instigated either by governments, by popular opposition or by the concessionaires. There is an escalating degree of opposition, mainly regarding privatisation in developing countries. However, there has also been criticism of private participation in the developed countries, with several notable examples.

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