Private Provision of Rural Infrastructure Services: Competing for Subsidies

Market-oriented reforms of infrastructure in developing countries tend to focus primarily on commercially viable services in urban areas. Nevertheless, an increasing number of countries are beginning to experiment with extending the market paradigm to infrastructure services in rural areas that are often less attractive in commercial terms. In these cases, subsidies are used to close the gap between market requirements and development needs, and are increasingly determined and allocated on a competitive basis. The authors discuss the conditions under which competition among firms for such subsidies-successfully used in the telecommunications sector in a number of middle-income countries-could also be applied to electricity, water and sanitation, and transportation services in lower-income countries.

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Bibliographic Details
Main Authors: Wellenius, Bjorn, Foster, Vivien, Malmberg-Calvo, Christina
Language:English
en_US
Published: World Bank, Washington, D.C. 2004-08
Subjects:RURAL INFRASTRUCTURE, RURAL DEVELOPMENT, RURAL ELECTRIFICATION, RURAL ENERGY, TELECOMMUNICATIONS SECTOR, WATER & SANITATION, TRANSPORT SERVICES ACCESS BARRIERS, BIDDING, BUSINESS MODELS, BUSINESS OPPORTUNITIES, BUSINESS OPPORTUNITY, BUSINESS ORGANIZATIONS, BUSINESS STRATEGIES, CAPITAL INVESTMENTS, COMMUNAL FACILITIES, COMMUNICATION TECHNOLOGIES, COMMUNITY DEVELOPMENT, COMMUNITY WATER, COMPETITIVE BASIS, COMPETITIVE MARKETS, CONNECTION CHARGES, CONNECTION FEE, CONSUMER GOODS, CONTRACTORS, COST RECOVERY, CROSS-SUBSIDIES, DEBT, DEBT FINANCING, DEVELOPED COUNTRIES, DOMESTIC CONNECTIONS, ECONOMIC DEVELOPMENT, ECONOMIC POLICIES, ELECTRICITY, EXTERNALITIES, FARMS, HAND PUMP, HOUSEHOLD CONNECTIONS, HOUSEHOLDS, INCOME, INITIAL INVESTMENT, INVESTMENT COST, INVESTMENT COSTS, LEVIES, LICENSES, LOCAL AUTHORITIES, LOCAL OPERATORS, LOCAL WATER, MAINTENANCE COSTS, MARGINAL COST, MARKET DISTORTIONS, MUNICIPALITIES, PAYPHONES, POLICY RESEARCH, POTABLE WATER, PRIVATE COMPANIES, PRIVATE FINANCING, PRIVATE OPERATOR, PRIVATE OPERATORS, PRIVATE SECTOR, PROGRAMS, PROVISION OF SERVICES, PUBLIC SECTOR, PUBLIC SERVICE, PUBLIC TRANSPORT, QUALITY STANDARDS, RADIO, REFRIGERATION, REGULATORY FRAMEWORK, RENEWABLE RESOURCES, RESPONSIBILITY FOR SERVICE PROVISION, REVENUE COLLECTION, ROADS, RURAL COMMUNITIES, RURAL OPERATORS, RURAL TELECOMMUNICATIONS, RURAL TELEPHONY, RURAL WATER, RURAL WATER SUPPLY, SANITATION, SANITATION FACILITIES, SANITATION SERVICES, SAVINGS, SCALE ECONOMIES, SEPTIC TANK, SERVICE CONTRACTS, SERVICE DELIVERY, SERVICE DELIVERY MECHANISMS, SERVICE DEVELOPMENT, SERVICE PROVIDERS, SERVICE PROVISION, SERVICE QUALITY, SERVICE STANDARDS, SEWERAGE SYSTEMS, SMALL MUNICIPALITIES, SMALL TOWNS, SURFACE WATER, TAX, TAX REVENUE, TAXATION, TECHNICAL ASSISTANCE, TELECENTERS, TELECOMMUNICATIONS, TELECOMMUNICATIONS COMPANIES, TELECOMMUNICATIONS NETWORKS, TELEPHONE LINES, TELEPHONES, TELEVISION, TOWN, TOWNS, TRADEOFFS, TRANSPARENCY, URBAN AREAS, URBAN WATER, URBAN WATER SUPPLY, USER CHARGES, WASTEWATER TREATMENT, WATER, WATER COVERAGE, WATER DISTRIBUTION, WATER QUALITY, WATER SERVICE, WATER SERVICES, WATER SOURCES, WATER SUPPLIES, WATER SUPPLY, WATER SUPPLY COMPANY, WATER SUPPLY SYSTEMS, WATER SYSTEM, WATER SYSTEMS, WATER USER, WILLINGNESS TO PAY,
Online Access:http://documents.worldbank.org/curated/en/2004/08/5064627/private-provision-rural-infrastructure-services-competing-subsidies
https://hdl.handle.net/10986/14168
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Summary:Market-oriented reforms of infrastructure in developing countries tend to focus primarily on commercially viable services in urban areas. Nevertheless, an increasing number of countries are beginning to experiment with extending the market paradigm to infrastructure services in rural areas that are often less attractive in commercial terms. In these cases, subsidies are used to close the gap between market requirements and development needs, and are increasingly determined and allocated on a competitive basis. The authors discuss the conditions under which competition among firms for such subsidies-successfully used in the telecommunications sector in a number of middle-income countries-could also be applied to electricity, water and sanitation, and transportation services in lower-income countries.