Private Sector Participation in the Provision of Quality Drinking Water in Urban Areas of Ghana: What Do Households Want and Can Afford?

• Published date: 01 June 2016
• Date: 01 June 2016
• DOI: http://doi.org/10.1111/saje.12099
• Author: Godwin K. Vondolia,Francis Mensah Asenso‐Boadi

PRIVATE SECTOR PARTICIPATION IN THE PROVISION OF

QUALITY DRINKING WATER IN URBAN AREAS OF GHANA:

WHAT DO HOUSEHOLDS WANT AND CAN AFFORD?

GODWIN K. VONDOLIA

*

AND FRANCIS MENSAH ASENSO-BOADI

†

Abstract

This study conducts a survey among households in three cities in Ghana on how water delivery

should be managed. The contingent valuation method was used to estimate the willingness to pay

for improved water delivery under private sector participation. Results indicate that most

households will remain connected to their current water supplies if private sector is engaged to

improve water delivery at higher monthly water bills. Given that the mean household monthly

water bill of GH¢10.82, the results indicate that there is demand for water quality improvement,

and private sector engagement is likely to provide these services. However, this policy measure

marginalises the poor in terms of access to water. Therefore, private sector participation in water

delivery may require a complementary programme to promote access to water.

JEL Classification: Q51, Q5, H44, H4, Q25, Q2

Keywords: Contingent valuation, water quality, private sector participation, Ghana

1. INTRODUCTION

The proportion of urban population worldwide has exceeded the 50% mark. In 2014, it

is estimated that 53.6% of world population is living in urban areas (UNDESA,

2014).This rapid urbanisation places greater demand on provision of utility services such

as water. Access to clean drinking water is a fundamental human right and a critical

requirement for sustainable development, economic growth and poverty reduction (see

World Bank, 2003). Universal access to potable water remains a mirage because of the

high population growth rates and the low investment for rehabilitation and expansion of

water infrastructure. Achieving equitable access to water complicates water delivery

especially in urban centres in developing countries. The World Health Organization’s

daily requirement for water is 20-40 litres a day per person, and an additional

requirement is that water source should be located within a reasonable distance from the

household. At the turn of the millennium, 78% of the urban poor were reported not to

have regular access to piped water.

* Corresponding author: Research Fellow, Department of Economics, Norwegian College

Fishery Science, University of Tromsø, Tromsø 9037, Norway. Tel: +47 776 455 64.

E-mail: kofi.vondolia@uit.no or gkvond@yahoo.com

†National Health Insurance Authority, NHIA, PMB, Ministries Post Office.

We acknowledge a research grant from African Economic Research Consortium. We are grateful

to researchers and resource persons at the 2009 AERC research workshops especially to MelvinD.

Ayogu, Ann Veiderpass and Anke E. Hoeffler for their useful guidance. We also acknowledge

constructive comments from two anonymous reviewers.

South African Journal of Economics Vol. ••:•• •• 2015

© 2015 Economic Society of South Africa. doi: 10.1111/saje.12099

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