FINANCING AND MANAGING WATER AND WASTEWATER SERVICES: A GLOBAL PERSPECTIVE

There are two great challenges to be faced in providing water and sanitation services to people in developing countries. The first challenge is to complete the “old agenda ” of providing household services-- a billion people still lack access to an adequate supply of water, and 2 billion do not have adequate sanitation facilities. What is needed is to change the focus from supply-driven, subsidized programs to ones in which users are provided the services they want and are willing to pay for. The private sector-- both for-profit and not-for-profit-- will have to play a much larger role, for reasons of both service quality and financing. The second challenge is to address the “new agenda ” of managing water in an environmentally sustainable manner. This is a challenge which no industrialized country has yet met successfully, and it poses an even more daunting one for developing countries, where resources are much more limited and starting conditions far worse. Emerging experience from industrialized and developing countries alike shows that the approach must include: participation by all stakeholders in basin management, close attention to costs in setting standards and prioritizing investments, and substantial use of economic instruments, such as water markets, and abstraction and pollution charges