Water and Sanitation in Latin America and the Caribbean: An Update on the State of the Sector

Abstract

The purpose of this paper is to provide with an updated snapshot of the water and sanitation sector across Latin American countries, focusing of its key policy characteristics. Access to water and sanitation in the region has improved since the 1990s, decade during which almost every country adopted major reforms of the sector, consisting mainly in increasing private sector participation and the creation of autonomous regulatory bodies. We find that challenges remain in tariff design, service quality, financial health of the sector, and in governance issues related to a lack of coordination between the level of decentralization of the regulation and management of the sector. Finally, the paper provides with a review of the related empirical literature.

Keywords: Water, sanitation, Latin America, privatization, regulation, tariffs, service quality

JEL Classification: L33, L38, L43, L51, L95, O13, O18, O54