Peru Charts Course for Private Water Investment
On 15 September 2014 Peru’s Ministry of Housing, Construction, and Sanitation (MVCS) released its new 8-year plan for the sanitation sector. The plan budgets over US$18 billion of investment in water distribution, water treatment, and wastewater treatment of which 80% represents new projects.
Access to drinking water in Peru increased from 68% to 86% nationally between 2007 and 2013, while wastewater treatment access climbed from 60% to 68%. The country still faces major gaps between urban and rural coverage, as wastewater coverage is still only 19% in rural areas. The 2014-2021 plan offers an ambitious set of targets and budget earmarks aligned with population growth to reach 100% drinking water and wastewater coverage by 2021.
Most of Peru’s 54 municipal water utilities posted significant operating losses in 2013, and the government requires greater private participation in the sector to meet its targets– including the sale of a 49% stake in Peru’s largest state water utility, SEDAPAL, serving 9.4 million people in Lima.
- Plan zeroes-in on acute wastewater treatment capacity shortage
- State water utilities ailing for lack of management efficiency
- Spanish players well-positioned to tap new wastewater build-up, industrial projects key