Since 1990, many national and localgovernments in developing countries have contracted withprivate companies to operate or manage their water utilitiesunder Public-Private Partnership (PPP) contracts. Theassumption was that the private sector will improveutilities by bringing in new capital, raising the level ofstaff expertise, and making operations more cost-effectiveand efficient. More than 260 PPP contracts have been signedto provide water services in more than forty developingcountries. The recourse to private operators has beenaccompanied, however, by a good deal of controversy. Severalhigh profile contracts, such as in Buenos Aires, werecancelled in recent years following conflicts between thepublic and private partners. This has raised doubts aboutthe suitability of PPPs to help improve water services indeveloping countries. Yet, there has been only littleobjective data available in the literature about theperformance of PPPs, and the resulting debate has been basedmore on ideology than fact. This study attempts to redressthe shortage of information by examining, through objectiveindicators, the actual performance of PPPs in developingcountries over the last fifteen years. It collected datafrom as many as 65 PPP projects, representing a servedpopulation of about one hundred million people half of theurban population served at one point in time since 1990 byprivate water operators, and 80 percent of the populationserved by a private operator for more than 3 years and undera contract signed before 2003.
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