Innovations in Private Sector Development
• 6,615 household water connections in four provinces (Son La, Ha Nam, Nghe An, An Giang) in Vietnam as of December 2019 • 4 manuals with instructions and methodology to formulate full cost recovery tariff and guidance on the approval procedure • 3 dissemination workshops at national and regional levels • 2 water kiosks and 20 membrane filters were installed in Chieng Mai Commune, Son La delivering approximately 30,000 liters per day, providing 4,700 local residents with safe drinking water Despite significant improvements in rural water supply, Vietnam still faces considerable challenges in “reaching the last mile” i.e., providing the poorest quintile of the population with access to clean water and sanitation. Connection costs, technical and financial sustainability issues are among the reasons for limited coverage and low-quality services. Research in Vietnam shows that the local private sector can deliver efficient water supply service, and be adaptive to new technologies, as well as deliver high quality services in the right contexts. However, current legal conditions and preferential policies on private enterprise are unclear or only partially implemented. With funding from the Australian government (DFAT), the Private Sector Development in Rural Water Supply Sector project (2016-2020) used government funding to leverage maximum private sector investment while ensuring sustainable and equitable services in Vietnam’s rural water supply sector. While maximizing social welfare for households, the project supported the financial sustainability of private enterprises’ business operations. The results from the project are being used to advocate for regulatory reforms and encourage government buy-in to transparent bidding processes and innovative financing mechanism. The project outcomes also call for appropriate safeguards and service standards, which are critically needed to ensure public health and safety.