Publication: Getting the Private Sector Involved in Water : What to Do in the Poorest of Countries?
Date
1997-01
ISSN
Published
1997-01
Author(s)
Brook Cowen, Penelope J.
Abstract
Water has historically been hugely
underpriced in most developing countries. Water systems are
often poorly run. Regulatory frameworks are often lacking,
incomplete, or internally inconsistent, and the relevant
skills thinly spread. There is little trust that the
government will maintain a favorable operating environment
and a tariff yielding a reasonable rate of return. It is
not a setting attractive to the private sector. While much
stands in the way of private provision of water services in
the poorer countries, the following four options,
individually or in combination, may speed transformation: 1)
taking a stepwise approach; 2) simplifying contracts; 3)
contracting out parts of the regulatory function; and 4)
increasing predictability in the use of discretion. There
is often a sharp difference between what private companies
see as a minimal return necessary to go into business in a
risky country and what governments view as an acceptable
level of profit. Governments should be realistic about the
profits that they should allow, recognizing the need of
their private partners to earn a reasonable return and to be
rewarded for the risks that they shoulder.
Citation
“Brook Cowen, Penelope J.. 1997. Getting the Private Sector Involved in Water : What to Do in the Poorest of Countries?. Viewpoint. © World Bank, Washington, DC. http://openknowledge.worldbank.org/entities/publication/6c3be1c7-e0df-534e-ad99-d8d431fb1e59 License: CC BY 3.0 IGO.”
Report Series
Report Series
Other publications in this report series
-
PublicationInvestment Climate in Africa(World Bank, Washington, DC, 2015-07-01)The World Bank Group has been working on investment climate reform in Sub-Saharan Africa for nearly a decade, a period characterized by dramatic economic growth on the continent. Establishing links between such reform interventions and economic growth, however, is a complex problem. Although this note finds some connection between investment climate reform and economic growth, establishing more concrete evidence of causation will require greater focus at the country level, as well as on small and medium enterprises. This is where investment climate interventions generate change.
-
PublicationExport Competitiveness: Why Domestic Market Competition Matters(World Bank, Washington, DC, 2015-06)This review of the empirical literature shows that industries with more intense domestic competition will export more. Competition law enforcement can be traced to export performance and is complementary to trade reforms. Pro-competition market regulation that reduces restrictions and promotes competition, where it is viable, is an important determinant for trade. The elimination of barriers to entry and rivalry, and a level playing field in upstream sectors contributes to export competitiveness in downstream manufacturing sectors. In some sectors, effective competition policy can directly lower trade costs.
-
PublicationPrimary Care for the Poor: The Potential of Micro-Health Markets to Improve Care( 2015-01)Much of the primary curative care provided to the poor by the private sector occurs not at large hospitals but at small, single-person clinics. While such micro-health providers increase access, questions persist about quality. Some have argued that the micro-health sector needs to be better regulated. This note cites recent studies in arguing that the micro-health sector needs to be better understood. A more evidence based approach may enable the World Bank Group to better target investments and interventions and help these providers fulfill an important role serving the poor. The following recommendations are made at the conclusion of this paper: (1) Effort, rather than hardware or training, may count the most. (2) Scaling up interventions to improve quality requires understanding and addressing market failures. (3) Changing the way impacts are measured will lead to smarter investments.
-
PublicationSmall Business Tax Regimes(World Bank, Washington, DC, 2016-02)Simplified tax regimes for micro and small enterprises in developing countries are intended to facilitate voluntary tax compliance. However, survey evidence suggests that small business taxation based on simplified bookkeeping or turnover is sometimes perceived as too complex for microenterprises in countries with high illiteracy levels. Very simple fixed tax regimes not requiring any books or records tend to be overly popular but prone to abuse. System reforms will require more precise tailoring of the simplified regimes to their target beneficiaries, coupled with strong compliance management to detect and deter abuse. The overall objective of simplified taxation for micro and small enterprises (MSEs) in developing countries is generally to facilitate voluntary tax compliance and remove obstacles in moving toward business formalization and growth.
-
PublicationCompetition and Poverty(World Bank, Washington, DC, 2016-04)A literature review shows competition policy reforms can deliver benefits for the poorest households and improve income distribution. A lack of competition in food markets hurts the poorest households the most. Competition in input markets and between buyers helps farmers and small businesses. And more competitive markets bolster job growth over the longer term. More research is needed, however, to better understand the impact of competition reforms and antitrust enforcement on poverty and shared prosperity.