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United Nations Environment Programme
Division of Technology, Industry and Economics
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Newsletter and Technical Publications
<International Source Book On Environmentally Sound Technologies
for Wastewater and Stormwater Management>

1.9.4 Private Sector Participation (PSP)

In many countries of Africa, the reality is dawning that mechanisms and guidelines for private sector participation (PSP) should be developed, particularly for wastewater collection and disposal. Who will invest and what are the returns and collection methods? Opportunities identified include taxing landlords and ploughing back such tax for the improvement of their informal settlements.

Some of the reasons given by wastewater and stormwater management services for the desire to involve the private sector include:

  • enabling rapid expansion of areas of supply or service coverage;
  • demand on available resources is too great;
  • a desire, indeed urgent in most cases, to improve the level of service; the need to reduce cost of the service through increased efficiency; the need to find additional sources of funding.
  • The delivery options (see also World Research Commission (1995) and Oyebande 1996) which are available for PSP have been outlined by the World Bank, and adapted to the African situation by South Africa in its preliminary guidelines for PSP (Water Research Commission 1995). The options range from service contracts, management of assets, rent of assets, to investment linked contracts and sale of assets. The following policy principles should guide such PSP to ensure optimum benefit to the public as well as the private sector company.
  • Performance of the service providers must be monitored;
  • The engagement of private sector should provide for technology transfer and capacity building;
  • The service providers must be accountable to the people they serve;
  • Provision of infrastructure must be done in a sustainable manner; and
  • Opportunity should be given to all competent contractors to bid for the contract.

Table 1.22 shows some examples of private sector involvement in the water sector in Africa, and the level of such involvement.

Table 1.22: Examples of infrastructure privatization in Africa in the water sector
Management contract Lease contract Concession
Gabon Central African Republic -
Gambia Cote d’Ivoire -
Mali Guinea -
- South Africa -

 

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