Senegal shifts its thinking: Context is everything

Editor's note: this is the second in a two-part series. Click here to read the first part, "Senegal shifts its thinking: Rural water delivery moves to private operators."
 

In the rural water sector in Senegal, as with many parts of the world that have experienced tremendous changes, context is everything. Rarely does one single act spur a shift at the government level; many elements combine to prompt a change in approach.

The PPP team in Senegal was privileged to be able to develop a brand-new system for rural water delivery in Senegal (see previous post here), but our activity was just one contributing factor in a much larger national and even international effort. The political context in Senegal, along with sustained attention to the Millennium Development Goals (MDGs), created the right atmosphere for this PPP.   
 
Here are five important elements that came together to make Senegal’s paradigm-shifting PPP possible:

1. Government officials’ forward-thinking views. Coming up with an original plan for the delivery of rural water depended on zoning changes. Our group’s internal study showed that dividing the country into three zones would make it possible to cluster services. Government’s willingness to consider clustering pipe systems across 14 regions was critical, because it made support from the private sector a viable option.
2. Government’s master plan. One of the ways Senegal is unique is that government  manages water service delivery at the central level, making distribution of water service especially complex. But the government has invested a lot in rural water over the years, and it is interested in making whatever new plan it has sustainable in the long-term. With an asset holding company, the new program can be managed centrally – so the government’s master plan can provide for water services to villages that have not yet received water delivery.
3. Understanding what makes an effective PPP contract.  Early in the process, the government developed its own PPP contracts, but over time – and because of a rigorous, ongoing lessons learned process – officials moved away from this approach. For the second PPP in the Central zone area (which comprises five regions), OFOR – the asset holding company – developed an outstanding contract that has become our blueprint since the transaction launched last month. The government is now discussing procurement for PPPs, and once that phase of the project is complete, the five regions in question will serve 3 million rural residents of Senegal through this PPP.
4. Legislation. The 2014 PPP Act, adopted by Senegal’s parliament on February 10, 2014, reaffirmed the Government of Senegal’s commitment to leveraging private sector engagement and creates an opportunity for increased donor and partner support. The 2014 Act replaces the 2004 BOT (Build-Operate-Transfer) Act and improves on it by enlarging the reach of PPPs to new traditionally “social” sectors such as agriculture, education and health. In addition, two rural water affermage procurements are already underway and a new model for partnering with private operators is being launched in Dakar’s urban sanitation system.
5. International milestones.  Community-based management of rural water systems in Senegal shifted to private operators within a new institutional framework partly because of the Government of Senegal’s commitment to meeting the country’s water and sanitation MDGs. MDG tracking against similarly-situated nations allowed Senegal’s government officials to compare progress and promoted greater ambition.

There’s no shortage of resources listing best practices, accounts of lessons learned, and theories on what makes some PPPs successful.  In Senegal’s rural water sector, hard work and close study over many years played a role, but so did elements that are beyond our reach.  The key is paying attention – knowing when the time is right for a PPP – and this includes an assessment of the overall environment. 

In this case, our attention to context and a commitment to long-term success was key to unlocking water delivery for 7.5 million rural Senegalese.
 
For more information: “Open for Business: Senegal’s Rural Water & Urban Sanitation Sectors Leverage Private Sector Participation to Improve Service"