Supporting the Policy Enabling Environment for Development

Promoting Investment in the Water Sector

DNAAS has become more focused on the critical importance of private sector investment to help meet DNAAS’ estimate that USD 3.1 billion investment is required for Mozambique to fulfill their commitment to SDG Number 6 (universal access to water by 2030).  To help attract more investment in private water systems, SPEED+ will support DNAAS and AFORAMO communicate opportunities to potential investors and upgrade their capacity to effectively manage PWPs.

SPEED+ will assist DNAAS and AFORAMO to design a communication strategy and promotional campaign targeting increased investment by new and existing PWPs.  Assistance will include budgeting for the promotional campaign, and identifying adequate funding for the roll out.  SPEED+ intends to speak with Mozambican banks to see if a line of credit can be established for PWPs and explore the possibility of using USAID Development Credit Authority (DCA) to guarantee loans to PWPs.  SPEED+ will also consider opening a challenge grant window to finance innovative approaches to securing new investment in PWPs throughout Mozambique.

As PWPs become regularized and are required to comply with technical and service standards, there will be new demands on PWPs to invest and upgrade existing services.  The GRM is also committed to attracting new investment into the sector to expand service.  The establishment of a predictable tariff model will provide the foundation for analyzing investments and enable the private sector to calculate ROI and profit.  The establishment of technical and service standards defines the technical capacities required of PWPs to maintain compliance.  As standards and regulations are implemented, PWPs will require assistance to meet and comply with new regulations and expand their investment outlays.  To ensure PWPs can comply with new standards and regulations, SPEED+ will support DNAAS and AFORAMO to develop and offer capacity building assistance to PWPs, on a co-funding basis. Following a training of trainers, it will be rolled out by AFORAMO, Provincial Directorates of Public Works and Housing (DPOPHRH), and Water Research Institute (IIA).  The training will include modules on project finance for water system upgrades and expansion, financial management including software for automated billing, receipts, tracking of payments and expenses, cost control, etc.  Technical modules will include repair and maintenance of water systems, water loss detection, and rapid response intervention systems. This activity is expected to be initiated in Quarter 3.