Large concessionaire companies find it difficult to provide water services in small centres and the informal areas of large cities, since their structure and their marketing policy are poorly suited to these marginal or not very profitable areas. And yet, these areas shelter a large and fast-growing proportion of the population of the countries of the South, and without a "modern" water service, an alternative water service is obviously being provided by private operators generally belonging to the informal sector.

HydroConseil has conducted studies on the latter in five countries. These reveal their great dynamism, their marketing skills and their overwhelming economic significance in the sector, in terms of jobs, of turnover and of the number of families they serve. Any water supply programme must include these private operators, all too long ignored because project approaches, borrowed from water service operations in the countries of the North, find it difficult to take them into account.

Our research programme related to the poorly defined (in terms of land plots), informal or peripheral areas of three capital cities (Port-au-Prince, Dakar and Nouakchott) and of two large cities (Kayes and Bobo Dioulasso). It also considered the secondary centres of four countries (Mali, Senegal, Mauritania and Burkina Faso). We were able to bring together and exploit the experience of eight organisations (NGOs and consultancies) involved in water supply programmes in these countries, including HydroConseil, AFVP, GRDR, Gret, Faq, Epureh, Ifan, and Tenmiya.

The number and the range of operators contacted during field surveys provided post hoc confirmation of the initial hypothesis of our research activity, i.e. that a large proportion of water services, (and virtually all sanitation services) is being provided by private operators (mostly in the informal sector), even though these operators had been until now "invisible" and had been the object of only very rare studies.

Private operators' activities were addressed, wherever possible, on two levels: a macro-economic level (to assess the significance of these actors in the drinking water sector on the scale of a whole city) and a micro-economic level (to analyse each enterprise's own dynamics).

Water attribution (in litres per day and per pers--on) and volumes distributed	Population Country	Niangologo 12000 Mali	Kayes 55000 Mali	Bobo Dioulasso 450 000 Burkina Faso	Dakar 2000000 Sénégal	Port-au-Prince 2 000 000 Haiti
Average attribution	1/ d. per hab.	11,1	28,1	24,5	-	55,0
Volume distributed	M3/day	133	1 544	11 036	75 400	110 000
Domestic connection	%volume	37%	64%	74%	86%	24%
Standposts proportion	%volume	63%	36%	26%	14%	1%
Annual turnover
T/O public enterprises	FF	138 600	469 500	15 170 000	65 540 000	11 000 000
Proportion of total T/O	%	32%	31%	67%	79%	16%
Standpost T/O	FF	76 420	450 700	2 573 733	16 550 000	1 400 000
Water carrier T/O	FF	216 000	587 200	4 8000 000	918 600	3 900 000
Cistern manager T/O	FF	0	0	0	0	30 000 000
Lorry T/O	FF	0	0	0	0	18 800 000
Private boreholes T/O	FF	0	0	0	0	4 000 000
Proportion of total T/O	%	68%	69%	33%	21%	84%

By analysing the turnover of operators in five cities (see table above), we showed that the average budget spent on drinking water ranged from 4 to 9 US $ per person per year, i.e. 2 to 3% of the GNP per inhabitant in these countries.

Small private operators (water carriers, cart drivers, standpost managers, lorry drivers, water vendors selling from cisterns and boreholes, etc.) represent between 21% and 84% of the added value of the production and distribution chain, despite most of them being in the informal sector. No serious economic analysis of water services can therefore afford to turn a blind eye to these private operators.

The proportion accounted for by private operators (in terms of volume distributed and added value) is generally greater in small centres than in large cities. Port-au-Prince is the exception to the rule here, because of the complete atrophy of the public sector.

Distributing water in small quantities is also an activity which generates a great many jobs. There are far more jobs amongst private water distribution operators (3 to 15 times as many!) than within concessionaire companies (public or private). Staff employed represent 2 to 4 per thousand of the population of the cities concerned, i.e. 1 to 3% of regular jobs.

The service provided by private operators complements that of concessionaire companies, which fail to meet demand from low-income families adequately. Private operators are on the increase precisely in the "interstices" of the public service, i.e. they fill the gaps in the services provided by national enterprises (public or private), notably by meeting fragmented demand for very small quantities in underprivileged or recently installed areas.

In addition, it is clear that the proportion of the water market and of jobs occupied by private operators is in inverse proportion to the performances of the national water service concessionaire company. An enterprise such as SDE in Dakar, now private and free from the burden of funding infrastructure (which is borne by Sonnes), provides a high quality service in practically all the areas of the city. The informal sector operators are therefore active only on the edges of SDE's operations, supplying water to building sites or door-to-door delivery. In this case, the turnover of the private sector in water distribution accounts for only 20% of the total. By contrast, an enterprise such as Camep, in Port-au-Prince, serves only half of the city and 13% of its families. In addition, the network has enough pressure for only a few hours per week in each area. Under these circumstances, private operators play a much greater part and their activities represent 80% of the turnover of the sector.

In certain situations where the service provided by the national operator is particularly poor, private operators may occupy all the segments of the "drinking water" production and distribution chain, forming a chain parallel to that of the national operator. The best example of this is Port-au-Prince, where the gradual deterioration of the metropolitan public service has led to the rise of private water producers (boreholes on the periphery of the city), of private water transporters (lorries delivering water to areas poorly served – if at all – by the national operator), and finally of private water vendors.

The idea is sometimes advanced that to improve the service provided by these private operators (better quality, more stable prices, etc.), they must be made to join the formal sector, making it easier to structure and train them. Not one of the findings of our research confirmed this hypothesis. "Formalisation" is a major constraint for operators whose survival depends first and foremost on being able to adapt to an irregular and minutely fragmented market. Acquiring a formal status with its baggage of constraints therefore leads most often to increased costs (additional charges) and a deterioration in the service (less adaptability to demand). The best example of this is when it is forbidden to re-sell water within a neighbourhood, which most frequently results in putting the "formal" standpost in a monopoly situation, without, however, providing any additional guarantees on the quality of the service.

In whichever country, the most marked feature is the dynamism of these operators and the range of the strategies they adopt. In drinking water supply projects, there is often a tendency to turn a blind eye to existing operators (somewhat hastily declared to be "not competent") and to promote an ideal, but fictional operator, supposed to serve as a model for the production and distribution chain as a whole. Generally speaking, this "made to measure" operator fails to survive the project which spawned it.

Despite the scale of importance of these private operators, "project" type dynamics find it difficult to provide them with effective support:

• what projects can offer does not match the needs which the enterprises feel they have;
• the white collar workers who design and steer projects are national or international civil servants who find it difficult to put themselves in entrepreneurs' shoes;
• the rigidity of the decision-making criteria of "project" structures encourages enterprises to provisionally adopt "project" vocabulary and its assumptions, without these representing any genuine internal shift on the part of the enterprise;

Requests for help expressed by the alternative operators we met therefore related not so much to financial aid (subsidies or loans) but rather to better access to public markets (calls for tender suited to entrepreneurial realities, flexible forms of contract, regular disbursements, etc.) and better legal security against abuses on the part of the central administration or certain competitors (sometimes artificially placed in monopoly situations by the very projects themselves).

ContactsHeads of the research activity:Bernard Collignon and Bruno Valfrey, HydroConseil, 53 rue du Moulin des Prés, 75013 Paris, France. Tel. / Fax: (33) (0)1 45 65 11 16. E-mail: h2oconseil@aol.com. Web: http://www.HydroConseil.com

Associate partners

- Denis Dakouré (Regional water department of upper watershed areas - Burkina Faso)- Alexandre Brailowsky, Patrick Vilaire, Alain Pamphile, Alice Conte, Gasner Bonhomme (Gret Haiti)- Moussa Dao, Thierry Vercauteren, Jean Kis (GRDR Kayes) et Thierry Vallée (GRDR Paris)- Bernard Gay, Rodolphe Carlier (Gret)- Sidi Aly Ould Moulaye Zeine (Gret Mauritania)- Mohamed Ould Tourad (Tenmiya)- Tidiane Koita (Epureh)- Séverine Champetier, Philippe Durand, Cédric Estienne (AFVP) and Youssouf Guissé (Ifan Senegal)

Countries: Burkina Faso, Mali, Mauritania, Senegal, HaitiResearch pole: 1.3Contexts: peri-urban areas and small centresDuration: 11 months (28.11.96 -30.10.97)Cost: 349,800 FRF