Access to clean, piped water is a critical part of United Nations’ Sustainable Development Goal 6 covering “water and sanitation for all”, aiming to achieve universal and equitable access to safe and affordable drinking water for all by 2030.

Despite this, as of 2020, up to one-in-four people globally do not have access to safe drinking water.

While many governments in developing countries have difficulty finding public funds to invest in essential infrastructure, Cambodia has seen strong private sector participation in the provision of clean piped water.

But according to the recently published study on Provincial Investment Plan for Piped Water Supply in Cambodia (PIP), as of 2020, only 47 percent of all Cambodia’s villages, about 53 percent of Cambodian households, have access to clean, piped treated water.

That number is low, especially when compared with Cambodia’s neighbouring countries Vietnam and Thailand.

“We hope the PIP will provide a useful roadmap and policy tools for the Cambodian Government to achieve its goal of providing clean water to all Cambodians by 2030”, said Australian Ambassador to Cambodia Pablo Kang during the launch of the report.

The report, conducted by Australian Government’s Investing in Infrastructure (3i) program in collaboration with Ministry of Industry, Science, Technology, and Innovation (MISTI), and its findings are timely, as it also contains implementation recommendations on policy changes, development, and other mechanisms to facilitate and fast-track the provision of clean, piped, treated water in rural Cambodia.

H.E. Prasidh Cham, minister of Industry, Science, Technology, and Innovation, echoed the ambassador and noted that “the partnership between MISTI and 3i through the PIP study establishes an important strategic direction for the development of Cambodia's clean water sector."

The Potential for Piped Water

The report and study assesses the current coverage status of piped water supply, identifies the potential for the establishment of treated piped water in villages that do not have access to piped treated water yet, estimates required investment costs, and identifies the support needed to stimulate infrastructure investment.

Cambodia allows for private companies to get a license to provide piped treated water services to most parts of the country, and as a result, the majority of piped water suppliers are private, amounting to over 400 companies, 80 of which have received grants from 3i, while only 13 water suppliers are public water utilities.

3i’s study indicates that the clean water sector has the potential to leverage private water investment further and reduce the burden of public investment or funding and suggests ensuring that the right support systems and policies are in place to further assist the private sector to jump in and help close the piped treated water gap in the uncovered villages. This is especially relevant in the recent months as government budgets have been constrained in the face of COVID-19.

To estimate the costs to bring piped treated water to the uncovered areas across Cambodia, the PIP study team designed 782 piped water systems on Google Earth for 4,966 villages covering 1.06 million households. Based on the design and its application on investment technical model developed for the study, it is estimated that an investment of USD 150.20 million is needed to close the gap of uncovered areas in Cambodia.

Closing the Gap with Viability Financing

Additionally, the study estimates that approximately USD 48.80 million will be needed as grant subsidy to leverage private water investment of around USD 100 million to invest in the 4,918 villages. One way of tackling this funding gap is Viability Gap Financing, an approach used by 3i to co-invest with private water operators to establish their water treatment infrastructure and expand their network.

As of writing, 3i has stimulated a total investment of USD 35 million to establish and expand treated piped water infrastructure through investments of more than 80 private water companies by using a Viability Gap Financing approach with the subsidy of 42 percent of total investment cost.

Mola Tin, Chief Technical Officer of 3i, notes, “Through our experience, Viability Gap Financing approach has stimulated private investments in piped water supply in areas, where the commercial viability is not strong enough to make the private sector invest by themselves, has proven to work well and be successful.”

Further, Tin suggests that the government and development partners should consider the approach in their clean water supply work to fast-track the provision of clean piped treated water in Cambodia as planned.

“This will enable Cambodians especially those from remote areas to enjoy the use of piped treated water and build back better especially during the post COVID-19 pandemic as more jobs and businesses will be created with the access to piped treated water as suggested by UN Water’s 2016 report ‘Water and Jobs,” stressed the Chief Technical Officer.

For more information, download the full report and contact info@thepalladiumgroup.com