Category Archives: Financing

Towards sustainable water services in La Paz, Bolivia

Woman in Chuquiaguillo siphoning water from tank to fill jerry cans. Photo: Erma Uytewaal, IRC.

Woman in Chuquiaguillo siphoning water from tank to fill jerry cans. Photo: Erma Uytewaal, IRC.

A Dutch-funded project aims to bring piped drinking water to peri-urban neighbourhoods of the Bolivian capital La Paz. What will determine its success? Is it the inhabitants’ willingness and ability to pay for improved water services? No, the biggest threat to the sustainability of the project is the lack of a national sector strategy that clearly outlines how to finance the full costs of service delivery.

At present, the 125,000 inhabitants of the Chuquiaguillo sub-district have to rely on a network of plastic/flexible tubes providing untreated water through public taps. Or they get water from water tankers and unprotected springs.

"Network of plastic/flexible tubes providing untreated water " in Chuquiaguillo. Photo: Erma Uytewaal, IRC.

“Network of plastic/flexible tubes providing untreated water” in Chuquiaguillo. Photo: Erma Uytewaal, IRC.

The Chuquiaguillo Water Supply Service Improvement and Extension Project will connect 25,000 homes to a new water supply system by 2015. The system consists of a water treatment plant and 50 km of distribution pipes. The project wants to ensure that services are sustained long after the infrastructure is in place. The IRC International Water and Sanitation Centre contributed to this aim by supporting consultants Royal HaskoningDHV to carry out a socio-economic feasibility study of the Chuquiaguillo project. The study examined the pro-poor impact of the project and the ability and willingness of the poor to pay for the services.

Royal HaskoningDHV and water operator Vitens Evides International (VEI) are advising Bolivia’s state-run water utility EPSAS to implement the Chuquiaguillo project. It faces several technical and environmental challenges due to the difference in altitude between the water reservoir and the service area, and climate change (for more details see the NL Agency website).  The project is being financed by the Facility for Infrastructure Development (ORIO), a grant scheme operated by the Dutch Ministry of Foreign Affairs.

Critical for the project’s sustainability is a national sector strategy that clearly outlines how to finance the full costs of service delivery. As it stands now, tariffs only cover direct operations and some maintenance costs. In line with the present governments’ pro-poor policy, service providers apply a solidarity tariff for the first 10 cubic metres of water. However, it is unclear how the solidarity tariff will be subsidised. This needs to be clarified in a sector financing strategy, which also promotes a life-cycle costs approach (LCCA) in which all costs for capital expenditure, capital maintenance, and direct and indirect support are covered.

The social action plan, to be implemented by EPSAS, will also contribute to the sustainability of the project. Enhanced transparency and accountability are important elements of the plan. This refers to  performance indicators on service levels provided, cost recovery, investments, customer satisfaction, and operation and maintenance (O&M).

For more information contact Erma Uytewaal

For more on IRC’s activities in Latin America go to: www.irc.nl/page/36926

For more on the Life-cycle costs approach go to: www.washcost.info

For more on sustainable service delivery go to: www.waterservicesthatlast.org

Colombia: testing innovative models for rural water and sanitation services

Photo: IRC

NGO “Give to Colombia” will implement several pilot projects that will serve as models for the Rural Water Supply and Wastewater Management Program in Colombia. This large-scale programme is financed with the help of a US$ 60 million loan from the Inter-American Development Bank (IDB).

The pilot projects have four components:

  • School water, sanitation and hygiene promotion (SWASH), which will implement and evaluate UNICEF’s model for SWASH interventions in at least 25 rural public schools
  • Post-construction support and the sustainability of rural water projects with a focus on innovative financial models
  • Sustainable models for the financing and provision of household connections
  • Sustainable self-supply models for disperse rural communities

The AquaFund and Japan Fund for Poverty Reduction are financing the pilot projects. Contributors to the Aquafund are IDB, the governments of Switzerland and Austria, and the PepsiCo Foundation.

The pilot projects will cost about US$ 2.1 million. The implementing agency Give to Colombia (G2C) receives resources from the Embassy of Japan and the General Electric Foundation. PepsiCo Colombia is supporting the dissemination of the innovative models being developed in the projects.

In 2011, IRC International Water and Sanitation Centre and CINARA carried out a study on behalf of IDB, about post-construction support on rural water supply services in Colombia [1]. The study [2] shows that those service providers that receive more structured support perform better.

[1] IADB publishes report on post-construction support on rural water supply services in Colombia, IRC, 21 Aug 2012 ; Webinar – Impacts of post-construction support on the performance of rural water supply in Colombia, IRC,

[2] Smits, S. et al., 2012. Gobernanza y sostenibilidad de los sistemas de agua potable y saneamiento rurales en Colombia. (Monografia; IDB-MG-133). [online] Washington, DC, USA: Inter-American Development Bank. Available at: <http://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=36986189>

Related websites:

Source: Latin American Herald Tribune, 10 Oct 2012 ; IDB, 02 Oct 2012

Spanish Cooperation Fund for Water and Sanitation launches new web site

FCAS web site

The Spanish Agency for International Development Cooperation (AECID, has launched a new website (in Spanish only) for its Cooperation Fund for Water and Sanitation, a financing instrument that supports water and sanitation initiatives in Latin America and the Caribbean.

Launched on 7 June 2011, it provides detailed information about the fund and is set to host a list of upcoming tenders carried out by Spain’s partner organisations and countries. The website also contains eligibility criteria and application instructions.

The Cooperation Fund for Water and Sanitation began operating in 2008 with a US$ 1.5 billion budget. The launch of the website is line with the Spanish government’s commitment to make the fund’s operation more transparent, AECID explains in a news release.

Web sitewww.fondodelagua.aecid.es

Source: Ivy Mungcal, Devex.com, 08 Jun 2011

Latin American development bank CAF and PAHO sign water and sanitation agreement

CAF – Latin American development bank – and the Pan American Health Organization (PAHO/WHO) have agreed to expand their cooperation on access to water, sanitation and health in the region. The agreement, signed on April 1st, 2011, was an amendment to an earlier Framework Agreement on Technical Cooperation signed on January 3rd, 2011.

CAF has been active in the sector for over 20 years and in the last five years it has approved about US$ 1.80 billion for the water sector. Most recently CAF approved US$ 12 million for water and sanitation projects in five districts of Bolivian city El Alto in La Paz department.

The CAF president Enrique García said:

“the importance of this signing is that we are joining forces with the world’s oldest public health organization which is actively working in the region. The resulting synergy will strengthen the mechanisms required for disease prevention.”

Related web sites:

Source: CAF, 05 Apr 2011 ; BNamericas.com [subscription site], 13 Apr 2011 ; PAHO [in Spanish], 02 Apr 2011

Haiti: US$ 10 million World Bank grant to bolster efforts against cholera, WHO warns that 400,00 could be affected

In response to the cholera outbreak in Haiti, the World Bank is preparing a US$ 10 million Cholera Emergency Grant as part its US$ 479 million reconstruction support. As of 22 November 2010 the outbreak has caused 1,523 deaths and could kill up to 10,000 people and affect 40,000 if the outbreak is not contained, according to the Pan American Health Organization (PAHO). The UN has appealed for US$ 164 million for additional treatment centres, scaled-up public information campaigns, supplies of medical equipment, rehydration salts, water purification tablets and bars of soap to respond to the outbreak.

The US$ 10 million grant will bolster the surveillance and monitoring capacity of the Ministry of Public Health and Population (MSPP) and the Haitian National Directorate of Water Supply and Sanitation (DINEPA). The initiative is aligned with the Cholera Inter-Sector Response Strategic Plan for Haiti, under the leadership of MSPP and DINEPA.

The grant will also help NGOs provide clean water and basic health services to affected people, and safe sanitation and waste management in high risk areas. These activities will complement existing hygiene awareness and prevention efforts such as the creation of a “Public Health Brigade”.

Through a Global Facility for Disaster Reduction and Recovery grant of US$ 200,000, the World Bank is identifying national and international actors already involved in these tasks, preparing a standardized training plan and training a core group of 250 trainers. It will also finance an awareness and prevention campaign.

The Bank has also provided assistance to the Directorate of Civil Protection since the beginning of the cholera outbreak to coordinate the response of the Government and its partners. This assistance has supported the setup and manning of the National Emergency Operation Center and management of the national campaign “Konbit kont Kolera,” which raises awareness on cholera and its prevention.

Civil unrest since 15 November 2010 has slowed down several activities, particularly in the Northern city of Cap Haitian. Trainings on cholera treatment and initiatives to chlorinate water for 300 000 people had to be postponed.

For the latest updates on the Haiti cholera outbreak go to ReliefWeb.

Source: World Bank, 24 Nov 2010

Bolivia: US$126mn CAF loan for water and irrigation projects

The Bolivian government has approved a US$ 126 million 14-year loan from Andean Development Cooperation (CAF) for water and irrigation project (PROAR) as part of a five-year programme. Over 600,00 people will get new (400,000 people) or improved (200,000) access to drinking water.

The projects, involving the Ministry of Environment and Water (MMyA) in coordination with municipal governments, will serve rural scattered populations and small towns. Implementation will start in January 2011.

Related web site: CAF – Programa Agua y Riego para Bolivia – PROAR

Source: ABI [article 232763, in Spanish], 24 Nov 2010

Spain Providing $164 Million for Safe Drinking Water Projects in Latin America

Latin American Countries by HDI (2008)

Image via Wikipedia

 

Seven Latin American countries will benefit from contributions approved on the 15th of October by the Spanish government amounting to 117.2 million Euros ($164 million) for projects providing safe drinking water and improving aqueducts and sanitation.

The contributions are intended for projects in Cuba, Ecuador, El Salvador, Guatemala, Honduras, Mexico and the Dominican Republic and will be managed by the Water and Sanitation Cooperation Fund of Spain’s AECID international development agency. There will also be a complementary contribution of 12.9 million Euros ($18 million) to finance new projects to be carried out in cooperation with the Inter-American Development Bank.

About 120 million people lack access systems for potable water and basic health services in Latin America and the Caribbean, according to figures released earlier this year at the 2nd Latin American Sanitation Conference.

Related news: Guatemala: US$ 100 million from Spain and the IDB to improve water and sanitation services, Source News, 21 January 2010.

EFE Source : Herald Tribune, 18 October 2010.

Honduras, Tegucigalpa: climate change fund approves water project

A project to improve water management in the capital Tegucigalpa is one of two first projects that the climate change Adaptation Fund has approved. The two projects (the other is in Senegal) together are worth US$ 14 million.

The proposal for the Tegucigalpa project was put forward by the Government of Honduras through the United Nations Development Programme (UNDP).

This project will reduce the vulnerability of at least 13,000 of the poorest households in the capital region of Tegucigalpa in Honduras by improving water management. The region already suffers from a constant water shortage in many of its poor neighborhoods and an inability to harness the occasional heavy rains that cause floods and landslides resulting from rising temperatures brought about by climate change.

The Adaptation Fund Besides receives direct contributions from developed countries, and through about 2 percent on credits generated by the Clean Development Mechanism (CDM) set up under the Kyoto Protocol, which in turn operates under the UN Framework Convention on Climate Change (UNFCCC).

Source: Adaption Fund, 17 Sep 2010 ; IRIN, 24 Sep 2010

Uruguay: drinking water for 355 rural schools and villages

In the presence of President José Mujica, Spanish ambassador Aurora Díaz-Rato and singer Jorge Drexler, a US$ 6.85 million grant agreement was signed for a four-year program that will improve water and sanitation at 355 rural schools, improving access to water for 24,000 people.

Left to right: Pres. José Mujica, Carlos Colacce (OSE), Jorge Drexler

The grant for the “Small Rural Communities Water Supply Program” comes from the Spanish Cooperation Fund for Water and Sanitation in Latin America and the Caribbean. The government of Uruguay will provide an additional US$ 6.85 million for the programme administered by the Inter-American Development Bank (IDB) and executed by the state-owned utility OSE.

The program focuses on rural schools, which play a key role in social integration and are at the centre of community initiatives. OSE has already started the program in 37 localities, each with an average of 20 houses. OSE charges a “social” tariff of 53 pesos (US$ 2.60) for up to 15 cubic metres of water.

By focusing on rural schools, the program will help maximize the benefits of installed water supply capacity and introduce education in hygiene and water conservation. It will begin by installing public standpipes and cylindrical water towers common in many rural areas. At a later stage, individual home connections will be implemented.

The program will upgrade schools’ water and sanitation infrastructure and ensure proper management of wastewater.

The grant signing ceremony was the the first official appearance of Jorge Drexler as “Water Ambassador” for Latin America and the Caribbean. The Spanish government appointed the Oscar-winning Uruyguan musician and doctor as goodwill ambassador for the Spanish Cooperation Fund for Water and Sanitation in Latin America and the Caribbean on World Water Day 2010.

Related web sites:

Source: Portal 180 [in Spanish], 16 Sep 2010 ; OSE, IDB, 30 Jul 2010 ; Portal 180, 22 Mar 2010

Nicaragua, Granada: Japan grants US$2.5mn to improve sanitation

The Japanese government has signed a 55mn-cordoba (US$2.56mn) grant agreement for the expansion of the sanitation system in western Nicaragua’s Granada city, local paper La Prensa reported.

Full article available on: BNamericas.com [subscription site], 13 Aug 2010