The Manila Water Concession

In January 1997 the Government of the Philippines awarded two long-term concession contracts, handing over to private consortia the responsibility to operate and expand water and wastewater services in Greater Manila. With a combined population of 11 million in the two service areas and investment needs projected at $7 billion over the contract period, the transaction was hailed as the largest water concession in the world. By tendering the contract competitively, the government was able to deliver an immediate benefit to customers: the winning bidders not only accepted contractual obligations to expand service coverage much faster than in the past, they also offered large rebates on the tariffs of the incumbent public utility. Mark Dumol was a key player in the Government team which steered the Manila transaction. In this book, he tells the story: how the idea of a concession emerged and gained support, how the preparation effort was designed and launched, how they surmounted the main hurdles and, how some of the key contract features were thought out. Overseeing a water concession of this size is a challenging process, which involves complex preparation work and extensive stakeholder consultation, and can be derailed easily by procedure or politics. Often--like in Manila--the government officials involved in preparing a concession have to learn by doing, as few countries have relevant prior experience. Mr. Dumol's objective in donating his time to write this book is to better prepare fellow government officials, who face similar challenges in other countries, for some of the issues they will have to address.