1 FRAMEWORK CONDITIONS FOR PRIVATE SECTOR PARTICIPATION IN WATER INFRASTRUCTURE IN MEXICO

2012 provide the broad policy frameworks under which private sector is expected to contribute to the national efforts to build and manage water infrastructure. According to the PNH, private sector is expected to contribute the necessary technology and funding to construct, operate and maintain the major works required by the water sector. The National Infrastructure Program identifies public-private partnerships as the appropriate vehicle for these efforts and puts forward some 300 infrastructure projects in multiple sectors, including water. The 2030 Water Agenda launched by CONAGUA in March 2011 builds on these programmes to highlight the importance of mobilising investment in the water sector, of strengthening the financial autonomy and sustainability of water utilities and of bringing technical and commercial efficiency gains in water systems. Under the appropriate enabling environment, the private sector is seen as being part of the solution. The rapid uptake of BOT contracts for the development of mainly wastewater treatment plants has shown that should incentives be in place – subsidies for project investment and the consequent reduction of long term fee, guarantees for private sector, specific financial instruments to manage the project funds, financial and risk sharing mechanisms as provided by the PROMAGUA programme (Box 4) –, there was private appetite for private sector participation (PSP) in water infrastructure. There is a need today to evaluat