The private sector's involvement in the water industry of Ghana

Abstract

Purpose – The past few years have seen some private sector involvement in urban and small-town water provision in Ghana, as the government strives to improve access to water supply services for its citizens in line with millennium development goals. Since 1995, both central and local governments have entered into various forms of public-private partnerships (PPPs) contracts. The paper aims to examine challenges and investment needs of Ghanaian water supply sector that necessitated private sector involvement; trends, and factors that constrain the development and implementation of projects with private sector involvement in the sector. Design/methodology/approach – A research approach integrating multi-stage critical review of relevant related literature and case studies is adopted in this paper. The study is further informed by the authors' experience in the sector and knowledge of PPPs. Analysis of data from different sources, using both approaches, provides both historical and contemporary approach to water management practice in Ghana. Findings – The paper reveals that the Ghanaian water supply sector mirrors the classic challenges of public sector utilities in developing countries. Under-investment by government is the major cause of the ill-performance of the sector, necessitating private sector involvement. Management contract has emerged as a popular form of water supply PPP in Ghana. Further, optimal risk allocation has not been widely adopted in these contracts, and not yet been given much attention by practitioners and researchers in the literature of water management in Ghana. Originality/value – The paper provides useful insights into the constraints of the water supply sector, development and implementation challenges of PPPs in the sector, and prompts a need for more research on risk allocation in water supply PPP contracts.