Water privatisation in SSA : progress, problems and policy implications : presented at the development studies association annual conference, University of Greenwich, 9th November 2002

Water privatisation is increasingly widespread and in sub-Saharan Africa (SSA), privatisation is now on the agenda in most countries. Although widely promoted, privatization is difficult and costly to achieve in practice and the results may be limited. Given the widespread weakness in regulation of the water sector in SSA some alternative means of accounting for the performance of multinational corporations in the water sector in poor countries is required. The conventional approach to regulation pre-supposes a capacity and a bargaining position which is often absent in many low-income economies. Where MNCs are supplying water to some of the poorest in the world, it is important to know that consumers are not being exploited. To enable policy makers in the host country to assess whether and how efficiency gains have been achieved, companies need to be required to publicly disclose details of their operations, including information on turnover, profit, number of connections, average price charged, capital expenditure, transactions with parent company and outstanding debts.

This paper aims to analyse developments by looking at what privatisation has taken place in the region; considering the countries where privatisation has not taken place and the reasons for this; and reviewing the findings from case studies on the impact of privatisation. Three main points emerge from this discussion : 1) the limited impact of privatisation depends on the initial state of the enterprise; 2) regulation has proved extremely difficult, even where regulatory capacity is relatively advanced; and 3) privatisation has been constrained by the lack of investor interest in the water sector in the region.