2005 - 2006 - Pinsent Masons Water Yearbook 2012

GUINEA PART 2: COUNTRY ANALYSIS
Guinea
Economics (2003)
GDP per capita US$430
GDP per capita (PPP) US$2,080
GDP in Agriculture 25%
GDP in Industry 36%
GDP in Services 39%
From DEG to SONEG
The Enterprise Nationale de Distribution des Eaux de Guinee (DEG) was responsible for all technical
and commercial operations up to the end of the 1980s. From 1976 to 1985, the World Bank provided
a restructuring loan, the results of which were extremely disappointing in spite of extensive technical
assistance from abroad. Indeed, by 1985, the urban water supply system in Guinea was one of the
least developed in West Africa. The utility had no management autonomy from the ministry and was
not able to finance maintenance work. In 1986 the Guinean authorities decided to liberalise the water
management regime and in 1987 established Société d’Exploitation des Eaux de Guinee (SONEG) as
an independent water services provision company wholly owned by the state. SONEG was
responsible for implementing and managing water supply, acting as owner of the facilities to serve
Conakry, the capital, and 16 other towns. The Minister of Natural Resources and Energy remains
responsible for approving and monitoring any capital investment.
Population
2002 (million) 7.9
2015 (million) 9.8
Urbanisation in 2003 29%
Urbanisation by 2015 44%
In urban agglomerations, 2015 32%
Commercialising water provision
In 1987, the World Bank recommended that radical institutional reform be carried out, with financial
support from the IDA, transferring management and risk to the private sector. The legal separation
between asset-management activities (SONEG) and operating activities (SEEG) took place in 1989
with the two companies formally established. One, the newly created Société Nationale des Eaux de
Guinée (SONEG), was to be responsible for conserving and enhancing the public assets, but also for
servicing the debt by levying a fee on the managing entity. SONEG in turn awarded a ten year
leasing contract for operations to SEEG (Société d'Exploitation des Eaux de Guinée), which has the
task of supplying water in Conakry and a number of smaller cities for a period of 10 years. The
contract can be renewed at the end of this period. SEEG was then privatised, with the government
maintaining a 49% stake in the entity.
Urban Data
Served by piped water 61%
Access to sewerage 54%
With sewage treatment 0%
Accountability and affordability
All of SEEG’s activities are defined in its terms and conditions and in a three-year performance
contract. SONEG derives its income from a fee paid by SEEG. The latter, for its part, operates the
water supply facilities. It also carries out maintenance of the facilities and replaces smaller items of
equipment. Lastly, it takes care of all aspects of consumer relations.
At the outset, tariff reforms would have created problems because water had never been regarded as
an economic good. The Guinean authorities therefore decided upon a six-year transition period
during which the rate actually paid by the consumer would be lower than the full rate, thanks to
subsidies from the state and from external sources. The World Bank paid a subsidy for the six years
(having required the introduction of a realistic price) which gradually decreased after the first four
years. This was to ensure that the sudden increase in price did not appear to be excessive for the
users.
105 Pinsent Masons Water Yearbook 2005 – 2006