Palau’s water, sanitation to be corporatized

13/10/2011

<p style="text-align: justify;">Palau last week received a US$16 million loan to improve the sustainability and cost effectiveness of its water and sanitation services. The financial assistance will help create a new corporate entity, albeit government owned, called the Palau Water and Sewer Corporation.<!--more--></p>
<p style="text-align: justify;">The loan will fund the “Water Sector Improvement Program”, which will address regulatory, management, technical and pricing problems that currently result in high non-revenue water losses and undermine cost recovery.</p>
<p style="text-align: justify;">Impressive growth in the tourism sector – which accounts for half of Palau’s GDP – has put pressure on the island’s water supply and sanitation. The government currently subsidises the bulk of the cost of water, which strains its finances. The loan, made possible by the Asian Development Bank’s Pacific Department, will help device a strategy to meet an estimated supply gap of some 1.4 million gallons a day by 2020.</p>
<p style="text-align: justify;">The corporate body will be set up to provide sustainable and efficient water and sewerage services throughout Palau and, over time, fully recover the cost of supply. ADB is to provide management and technical skills training to ensure the new agency is professionally managed. The project will be completed in 2014.</p>
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