Americas ok.indd - World Water Council

Table 4.2 Contribution to investment forall water related activities indeveloping countriesI. Source of financing ContributionII. Domestic government/public sector 62%Domestic non government 15%International aid flows 14%International private companies 9%SOURCE: Sunman 2002 from GWP Framework for Action 2000region. There are four main sources of finance for capitalinvestment in water (Table 4.2) and the various modelsof financing continue to be a source of debate, which isoften overshadowed by polemics (Vaughan 2005b). LatinAmerican and Caribbean countries typically follow thispattern, although the share of international private capitalmay be higher (Sunman 2002).The challenge of meeting increasing demands forservice provision have been compounded over thelast 30 years by lack of adequate financial resourcesin many countries. As a result both infrastructureand service quality have deteriorated, exacerbatingperceptions that governments were incapable ofensuring adequate service provision. Emergingfrom this experience it was acknowledged that newapproaches were needed and these have subsequentlyincluded increased private sector and communityparticipation in the operation and maintenance ofwater supply and sanitation services.However, private involvement is not akin toregulatory retreat or deregulation. On the contrary,the record shows that with the introduction of privateconcessions, more (not less) regulatory oversightis needed to ensure that the terms of reference ofconcessions are met (Vaughan 2005). The privatizationprocess undertaken in Argentina has resulted in thecreation of multiple regulatory bodies, with almost onefor each privatized service provider. This has resultedin the creation of a Federal Association of RegulatoryEntities (AFERAS) that includes 14 regulatory bodiesand has facilitated useful exchanges of informationand experiences, benchmarking of service providers in374th World Water Forum