Author

Cointreau-Levine, Saundra

1994

Number of Pages:

52

Full Text

Private Sector Participation in Municipal Solid Waste Services in Developing Countries

Abstract

Municipal solid waste management is an essential public service which benefits all urban residents. It is not

feasible to exclude from service those who do not pay, because public cleanliness and the safe disposal of

wastes are essential to public health and environmental protection. As a result of these characteristics, solid

waste management is a public good for which local or metropolitan governments are typically responsible.

This does not, however, mean that local government has to accomplish the task of solid waste service

delivery entirely with its own staff, equipment, and monies. In fact, this is where the role of the private sector

comes into play.

This paper discusses the reduction of government activity through the participation of the private sector in

service delivery. The paper poses the questions of whether and how to involve the formal private sector in

the provision of municipal solid waste services. Private sector participation is a possible opportunity – not a

panacea. In situations in which existing service delivery is either too costly or inadequate, private sector

participation should be examined as a means of enhancing efficiency (and thus lowering costs) and mobilizing

private investment (and thus expanding the resources available for urban infrastructure and equipment).

To decide whether to have private sector participation, many factors need to be analyzed, such as cost

recovery, efficiency, public accountability, management, finance, economies of scale, legislation, institution,

and cost. Cost factors in particular should be analyzed separately for the different components of solid waste

service collection, cleansing disposal, and transfer.

Methods of private sector participation most common to solid waste management am contracting,

concessions, franchise, and open competition, These options are discussed with particular emphasis given to

the roles and responsibilities of local government in each case. The suitability of each of these methods may

also vary for collection, cleansing, disposal, and transfer services.

The paper summarizes decision making criteria for whether to have private sector participation in delivery of

solid waste management services. Furthermore, it recommends steps for proceeding beyond the discussion

of issues and privatization approaches and moving toward field studies that will support decision-making in a

specific city and, where justified, lead to phased involvement of the private sector.