Crowding-in Commercial Financing to Water Supply and Sanitation Utilities
January 15, 2021 | < 1 Minute ReadIn this article, Michael Ashford and Lance Morrell discuss how the private sector can be tapped as a source of capital to fund the development of infrastructure and services around the world.
This post originally appeared on the Rural Water Supply Network blog.
Achieving SDG6, clean water, and sanitation for all by 2030 requires estimated investments of US$114 billion per year. The present value of the total investment needed is US$1.7 trillion, and these estimates do not include costs of operation and maintenance. At three times current levels, this far exceeds the financing capacity of the entire public sector and donor community, combined.
We in the development community need new tools and approaches to address this gap. Using donor and public funds to “crowd-in” private investment can help. USAID’s recently announced Private-Sector Engagement (PSE) Policy, for example, recognizes the urgency of using development funding to attract private sector capital into development of infrastructure and services around the world. Similarly, USAID’s Water, Sanitation and Hygiene Finance (WASH-FIN) program is developing and piloting specific interventions to increase private and public investment in WASH. The World Bank’s Public-Private Infrastructure Advisory Facility (PPIAF) is another important source of information and successes on how to leverage the public and donor sectors’ financial power to increase private investment in public infrastructure and services. In all cases, the policies and prescriptions call for the use of market-based approaches as the only sustainable path to sustainably support communities in achieving development and humanitarian outcomes…Read the full blog post on the Rural Water Supply Network blog.
Posts on the blog represent the views of the authors and do not necessarily represent the views of Chemonics.
