- A clear legal mandate and scope for service provision;
- Financial capacity—a solid financial track record with a positive net cash flow over several years;
- Strong management—including business-minded leadership, operational efficiency and strong performance; financial capacity (i.e., strong revenues to cover costs of operations and debt services); and good asset management and business planning;
- Track record of borrowing and repaying debts;
- An asset base against which collateral can be taken.
2. Materials and Methods
3.1. Governance at the Sectoral Level
3.1.1. Planning and Financing Strategies for Maximising Public and Commercial Funds to Achieve Social Objectives
3.1.2. Effective Tariff-Setting Practices and Economic Regulation
3.1.3. Adequate Performance Regulation and Transparent Accountability Mechanisms
3.1.4. Clarity of Mandate and Performance Obligations of Service Providers
3.2. Service Provider Level
3.2.1. Improved Financial and Operational Management and Efficiency
3.2.2. Capacity Strengthening for Business Planning
3.2.3. Enhanced Autonomy and Legal Framework
3.3. Supply of Finance
- Market finance is abundant and available—provided its risk-versus-reward terms are met—and is needed to close the infrastructure financing gap for services.
- There is no shortage of finance globally; there are excess funds available for investment through both simple and sophisticated private financial systems and instruments.
3.3.1. Rectifying the Mismatch between Commercial Bank Risk Profiles and WASH Sector Realities
3.3.2. Avoiding Mechanisms That Can Result in Market Distortions
3.3.3. Targeting Development Finance for Maximum Impact
- The governance, institutional, policy, tariff and regulatory arrangements to ensure transparency, consistency and sustainability (grey box with foundational issues 1 to 4);
- The technical and financial efficiency of service providers to sustain creditworthiness (light blue box with issues 5 to 7);
- Issues related to the supply and suppliers of finance (dark blue box with issues 8 to 10).
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