Drinking water supply and sanitation in Argentina is characterized by relatively low tariffs, mostly reasonable service quality, low levels of metering and high levels of consumption for those with access to services. At the same time, according to the WHO, 21% of the total population remains without access to house connections and 52% of the urban population do not have access to sewerage. The responsibility for operating and maintaining water and sanitation services rests with 19 provincial water and sewer companies, more than 100 municipalities and more than 950 cooperatives, the latter operating primarily in small towns. Among the largest water and sewer companies are Agua y Saneamientos Argentinos (AYSA) and Aguas Bonarenses S.A. (ABSA), both operating in Greater Buenos Aires, Aguas Provinciales de Santa Fe, and Aguas Cordobesas SA, all of them now publicly owned. In 2008 there were still a few private concessions, such as Aguas de Salta SA, which is majority-owned by Argentine investors, and Obras Sanitarias de Mendoza (OSM).
Most service providers barely recover operation and maintenance costs and have no capacity to self-finance investments. While private operators were able to achieve higher levels of cost recovery, since the Argentine financial crisis in 2002 tariffs have been frozen and the self-financing capacity of utilities has disappeared. Roughly two-thirds of provincial water and sanitation spending since 2002 has come from general transfers from the federal government, the remainder coming from various national programs directed specifically to the sector.
Services are regulated by the 23 Provinces, in the case of 14 through regulatory agencies that have some limited autonomy from the government. Overall, however, responsibilities are not always clearly defined, and institutions are often weak, subject to political interference and lacking enforcement powers. The various national institutions with policy-setting responsibilities in the sector are not always well coordinated. There is no coherent national policy in terms of sector financing, subsidies, tariffs and service standards. The federal structure of the country and the dispersion of sector responsibilities between and within various levels of government make the development of a coherent sector policy all the more difficult.
Between 1991 and 1999, as part of one of the world's largest privatization programs covering a range of sectors, water and sanitation concessions with the private sector were signed covering 28% of the country's municipalities and 60% of the population., p. 9 The highest profile concession was signed in 1993 with a consortium led by the French firm Suez for the central parts of Greater Buenos Aires. After the 2001 economic crisis, many concessions were renegotiated. Many were terminated, as it was the case in Buenos Aires in 2006.
The impact of private sector participation in water and sanitation is a controversial topic. While the public perception of the mostly international concessionaires is overwhelmingly negative in Argentina, some studies show positive impacts. For example, a 2002 study assessed the impact of privatization on child mortality based on household survey data, finding that child mortality fell 5 to 7 percent more in areas that privatized compared to those that remained under public or cooperative management., p. 1 The authors estimate that the main reason is the massive expansion of access to water. According to Suez, the private concession in Buenos Aires extended access to water to 2 million people and access to sanitation to 1 million people, despite a freeze in tariffs imposed by the government in 2001 in violation of the concession agreement. The government argues that the concessionaire did not fully comply with its obligations concerning expansion and quality, saying that the supplied water had high levels of nitrate, pressure obligations were not kept and scheduled works were not carried out., p. 168
Access In Argentina, in 2015, 99% of the population had access to "special" water, 98.9% in urban areas and 99.9% in rural areas. Still, in 2015, around 390 thousand lacked access to "improved" water. Regarding access to "improved" sanitation it includes 96% of the population, 96% and 98%, in urban and rural areas, respectively. Approximately, 1.5 million of people were still without access to "improved" sanitation, in 2015.WHO/UNICEF Joint Monitoring Programme for Water Supply and Sanitation
Urban (92% ofthe population) Rural (8% ofthe population) TotalWater Improved water source 98% 80% 97% Piped on premises 83% 45% 80%Sanitation Improved sanitation 91% 77% 90%Sewerage (2006 JMP survey & census data) 48% 5% 44% Source: Joint Monitoring Programme for Water Supply and Sanitation of WHO/UNICEF.JMP , 2010 Estimates.
According to a study by the Centro de Implementación de Políticas Públicas para la Equidad y el Crecimiento (CIPPEC) or Center for Implementation of Public Policies for Equity and Growth, the increase of coverage between 1991 and 2001 was lower in the poorest provinces.
Service quality
In urban areas of Argentina, service is generally continuous and of potable quality. However, water rationing occurs in some cities during the summer months, and drinking water quality is sometimes sub-standard.
In Buenos Aires, in 2008 there were two water treatment plants and a new one was about to begin.
Concerning sanitation, existing sewage collection systems are insufficient to handle the increasing flows as a growing number of households connect to the sewer systems, leading to frequent sewer overflows.
The level of wastewater treatment varies among the Argentinean regions. According to the Pan American Health Organization, at the national level 10% of the collected wastewater was being treated in 2000. Whereas in many regional capitals, such as Mendoza, Córdoba, Tucumán, Neuquén, Jujuy, Salta and San Juan, most of the wastewater was treated, in the two largest urban areas of the country, Buenos Aires and Rosario, there was practically no treatment at all, resulting in serious environmental problems. However, in 2008 a bidding process was launched to build a wastewater treatment plant in Buenos Aires.
Health Impacts The most frequent water-related diseases in Argentina are acute gastrointestinal diseases, paratyphoid, typhoid fever and intestinal parasitosis. Diarrhea is one of the most pressing health problems. . Hepatitis ("A" and those not specified) has a strong incidence, with 30,661 notifications being registered nationwide in 1997, evidencing marked increases in coincidence with areas of low socioeconomic development.
History and recent developments From 1880 until 1980, the national utility Obras Sanitarias de la Nación (OSN) was in charge of providing water and sewer services in the main cities, while in smaller cities it was the responsibility of provincial governments, municipalities and cooperatives.
In 1980 the military government under Jorge Rafael Videla decentralized the provision of water and sanitation services in the main cities served by OSN, except for the metropolitan area of Buenos Aires where OSN continued to provide services. In other cities OSN transferred its responsibilities to provincial governments. Each province chose its model of service provision (municipal, public enterprises, cooperatives or others).
Between 1991 and 1999 under the government of Carlos Menem, as part of one of the world's largest privatization programs covering a range of sectors, water and sanitation concessions with the private sector were signed in 28% of the country's municipalities covering 60% of the population. The highest profile concession was signed in 1993 with a consortium led by the French firm Suez for the metropolitan area of Buenos Aires. After the 2001 economic crisis, under the government of Néstor Kirchner, many concessions were renegotiated. Some were even terminated and the responsibility for service provision reverted to public entities, as it was the case in Buenos Aires where the newly created public enterprise Aguas y Saneamientos Argentinos took over the responsibility for service provision in 2006. At the beginning of 2008, the government of the Province of Mendoza announced that it is interested in increasing its control of the provincial water utility "Obras Sanitarias de Mendoza", of which it owns 20%, buying another 20% from Saur International.
Impact of private sector participation So far there has been no comprehensive, objective assessment of the impact of private sector participation in water supply and sanitation in Argentina. However, there has been some partial evidence. For example, a 2002 study assessed the impact of privatization on child mortality based on household survey data, finding that in the 1991-1997 period child mortality fell 5 to 7 percent more in areas that privatized compared to those that remained under public or cooperative management. It also found that the effect was largest in poorest areas (24%). The authors estimate that the main reason is the massive expansion of access to water, which was concentrated in poorer areas that did not receive services before private sector participation was introduced.
The Buenos Aires concession
The largest and best-known case of private sector participation in the Argentine water and sanitation sector was the Buenos Aires concession, signed in 1993 and revoked in 2006. Its impact remains controversial and in early 2008 an arbitration case was still pending with the International Center for Settlement of Investment Disputes (ICSID) of the World Bank Group.
Critics argue that the concessionaire failed to achieve the targets set under the concession contract. When the government rescinded the concession in March 2006, it argued that Aguas Argentinas did not comply with obligations concerning expansion and quality. According to the government, the supplied water had high levels of nitrate, pressure obligations were not kept and scheduled waterworks were not executed by the concessionaire. On the other hand, proponents of private participation state that a freeze in tariffs at the time of the devaluation of the Peso during the Argentinean economic crisis in 2001 substantially reduced the real value of tariff revenues and thus made it difficult to achieve the original targets.
One factor which may have caused the cancellation of the concession contract was the precipitate preparation. Alcazar et al. list some features of the concession which indicate an overhasty process:, p. 20-23 The regulatory agency ETOSS (Ente Tripartito de Obras de Servicios de Saneamiento, Tripartite Entity for Sanitary Services) lacked experience, since it was founded quickly as part of the concession process. The available information in the concession contract about the state of the existing infrastructure was so poor, that the Argentinean government denied taking responsibility for it. This lack of information could have let the bidder to accept the contract in the expectation of future renegotiation., p. 41 Instead of creating a new and more transparent tariff system, the old one was adopted from OSN.