Water

2^nd Southeast Asia Water Forum

29 August - 3 September 2005
Bali, Indonesia

There is an inherent conflict between the main stakeholders in the water sector: Investors and utility operators work towards increased revenues whereas consumers strive for decreased costs. On one end of the spectrum, the monopolistic nature of water utilities leaves the door open to abuses by utility operators in charging too much. On the other extreme, keeping tariffs artificially low to please consumers makes utilities economically unviable, eventually resulting in deteriorating services. On top of these is the escalating problem of providing water and sanitation services to a growing number of urban poor settlers in large Asian cities.

An important challenge is how to improve access to good-quality water for all consumers while ensuring that it is affordable and provided on a sustainable basis.

Part of the problem is a lack of a clear division of responsibilities in the sector between policy makers and service providers, and the lack of independent, credible regulators.

Regulation can play an important role in balancing the interests of consumers, operators, and investors. The primary objectives of economic regulation are to ensure that services are delivered to customers at a fair and reasonable price, customers receive the expected levels of service, and the interests of the customers, service providers, and investors are appropriately balanced and protected. While the interest in increasing private sector participation in the provision of water services has been largely driving the development of economic regulation, the objectives are equally applicable to publicly-run utilities, particularly where governments are encouraging public sector utilities to operate more efficiently.

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• Discuss the scope of economic regulation and its benefits to public and privately-run water supply
• Discuss strategies on tariff reform and the roles of policy makers and regulators in ensuring sustainability and affordability, especially for the urban poor;
• Share knowledge on the challenges and success stories on introducing regulatory systems in different Asian countries
• Discuss the steps needed by various stakeholders to champion such reforms, and how this could be assisted

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Almud Weitz
ADB Project Implementation Specialist, Indonesia Resident Mission
Phone: +62-21-251 2721
Fax: +62-21-251 2749
E-mail: aweitz@adb.org
Postal address: Gedung BRI II, 7th floor, Jl. Sudirman Kav 44-46, Jakarta 10210, Indonesia

Mai Flor
Consultant, [Water Governance Specialist]
ADB Manila
Phone: +632-633-4444 local 70161
Fax: +632-636-2444
Email: mmflor@adb.org; maiflor@info.com.ph
Postal address: 6 ADB Avenue, P.O. Box 789, 0980 Manila, Philippines