The Government of Benin wishes to ensure access to drinking water for all throughout the country by 2024, a much more ambitious deadline than that of the SDGs, which sets it for 2030. To achieve this, a very ambitious investment program, estimated at around FCFA 440 billion in urban areas, has already been launched.
Since 2013, the Central African Republic has experienced significant inter-community tensions that have had serious economic and social impacts. The country is now one of the poorest in the world, with an HDI index that declined between 2013 and 2017. Access to water services (75% in urban areas, 40% in rural areas) and electricity (around 5% nationally) is among the lowest in Africa and is concentrated in urban areas, particularly in Bangui, the capital. However, due to events, development actions have also been concentrated in Bangui or in rural areas. A large number of small towns (5 to 10,000 inhabitants) do not have any services, even though the demand seems high. Thus, in complementarity with the actions underway, the AFD wishes to develop a different approach adapted to these small towns, allowing the coupling of water and electricity access services with innovative equalization systems. Phœnix accompanies the AFD in the analysis of the legal and institutional feasibility of coupling these services, the evaluation of potential demand and capacity to pay of the populations and the definition of the guidelines of the project (intervention zone, institutional arrangements, management model, services and technological options).
The reform of the water and sanitation sector in Lebanon, which is based on the new Water Code adopted in April 2018, is an opportunity to better meet the needs of the population by moving from a public policy focused on the development of infrastructure to a policy oriented towards a sustainable and quality service offer for all by improving the existing services. In the framework of the support programme for the reform of the water and sanitation sector, the European Union has delegated a fund to AFD for the implementation of an ambitious Technical Assistance (TA) programme to the Ministry of Energy and Water (MoEW) and the four regional Water Establishments (WEs): strengthening of the legal framework, implementation of monitoring indicators, definition of service delegation modalities, reduction of losses, cost control, capacity building of actors, better planning and sectoral coordination in particular. The programme, which will last five years, has three main components: 1. Programme management and support for the MoEW and the regional WEs by a team of resident technical assistants ; 2. Carrying out of specific studies under a Framework Agreement with subsequent contracts financed by a study fund ; 3. Enhancement of the AFD Agency in Beirut for program implementation and supervision and sector coordination. Phœnix provided support to AFD to prepare the specifications for this TA, identify the main risks and define specific clauses of the TA contract in order to mitigate them, define the bid evaluation criteria and the contract remuneration terms and conditions.
In Burkina Faso, if the access to drinking water in urban areas has improved in recent years, with 93% reached in 2017, pressures remain on water resources. The country’s increasingly rapid urbanization is challenging the Government’s ability to meet the social demands of access to water, and increasing the pressures on water resource. In Bobo-Dioulasso, the country’s economic capital, water supply is not continuous, and certain areas suffer from a significant deficit, especially during the dry season. With a population that exceeds one million inhabitants, the challenges of access to water are therefore significant. In this context, the National Office for Water and Sanitation (ONEA), which provides the public drinking water service in centers with more than 10,000 inhabitants, started in 2015, with financial support from the French Development Agency (AFD), a program to strengthen the city’s drinking water production system, called PAPEP, to meet water needs by 2030. The objective is to define an investment program for the strengthening of the city’s distribution network and, thus, optimize the investments made by PAPEP by proposing a better distribution of the resource. Phœnix is responsible for assessing the conditions for the financial viability of these two projects with regards to their costs and the financing structure envisaged, including whether the two projects can support debt financing. This part of the study should therefore allow the AFD to decide on the conditions for on-lending State funding to ONEA.
With an urbanization rate of 55% and an urban population growth rate of 3.7% per year, Ivory Coast is one of the most urbanized countries in Africa. In addition, about 200 towns outside Abidjan suffer from a water supply deficit of more than 50% and more than 200 sub-prefecture capitals are not supplied by the public drinking water service. Therefore, substantial investment is needed to ensure satisfactory quality water services for the urban population. In terms of rural water supply, more than 8,000 water points should be added to the 20,800 existing ones to ensure good coverage of the rural territory, again leading to significant investment needs. Faced with these requirements, the portfolio of investment projects, which would amount to more than CFA 1,500 billion, is necessarily very ambitious, but its financial sustainability is not assured. Moreover, even the achievement of a “small balance” of operations is impossible today in a context where no tariff increase has been achieved since 2004. In order to think about a future sustainable financing scheme for the entire water sector, the Ivory Coast government has entrusted the consortium formed by Artelia, PwC and Phoenix to carry out a strategic study to identify all cost optimisation possibilities and all sources of financing. Phœnix is in charge, on the one hand, of ONEP’s organisational audit and institutional proposals for the sector and, on the other hand, of financial projections for the sector based on modelling. This study is to be completed in 6 months, so that the new government arriving in October will have all the elements in hand to make informed decisions
In the beginning of this year, Valérie Audibert, partner at Phœnix, carried out two training missions to update the financial models in place with the stakeholders in the water sector in Togo and Benin. The Phœnix partners have recognized expertise in financial analysis and modeling of the sectors and operators of water, sanitation and electricity in developing countries, especially on the African continent, resulting from long practice. Over the last fifteen years, several water companies in the sub-region have decided to adopt the technico-financial simulation model developed specifically by the teams led by Valérie Audibert during studies: SONES in Senegal, ONEP in Ivory Coast, ONEA in Burkina Faso, SPEN in Niger, SONEB in Benin, SOMAPEP in Mali, TdE and SP-Eau in Togo. They trust us today to support them in updating and evolution of this decision support tool. Shared between the different actors (operators, regulators, line ministries, donors), these models have the objective to constitute a full part decision support and negotiation tools allowing strategic arbitrations in terms of coverage of the service, investment, financing and pricing. In Togo, a technico-financial model of the urban water service had been developed in 2016 during the implementation of the tariff study carried out by Valérie Audibert. In Benin, the model has been in place within SONEB for more than 10 years, and redeveloped during the project manager assistance of the Cotonou DWS project – Phase 2. Each time, it is a complete financial simulation model, projecting by 2030, the term of the Sustainable Development Goals, the water demand of all the centers of the current and future perimeter, the investment program to meet this demand and the financial statements of the companies in charge of operating and managing the infrastructure. It enables the calculation of the average price ensuring the financial balance of the companies. Phœnix is delivering a training and support series for a team of agents in the water sector using a technico-financial model. In Togo, with funding from AFD, 9 agents from the TdE – the farmer -, from SP EAU – the assets company – and from ARSE – the regulatory authority of the sector – follow training for three consecutive years. In Benin, with SONEB’s own funding, the sessions are geared towards an annual update of the model, with an increasingly complete control of the tool by the agents. These training must allow the agents to understand, master and update the model, with updating exercises in real situation.