Environmental Services and Competition: A Global Perspective

Authors


  • Robin Simpson is a senior policy adviser at Consumers International, specializing in international trade and public utilities. He has advised consumer organizations worldwide on utility policy, notably in Central and Eastern Europe and Latin America. He was Head of Policy at the National Consumer Council of the UK during the period following privatization of the UK's utility sectors, and has been a member of the steering committees of Watertime, an EU project on decision making in water, and the Water Dialogues, which brings together different stakeholders in the water and sanitation sector. He has also advised OECD and the World Bank on policy in this area in recent years.

Abstract

Competition theory has been poorly applied in infrastructure sectors characterized by joined-up physical networks, such as water, sanitation and electricity. Crude tendering mechanisms have been used to promote competition, resulting in unstable contracts. Meanwhile, competition issues are hardly recognized, or are even suppressed in the non-networked (i.e. not yet connected) parts of these sectors. The difference between the networked and non-networked sectors within a given service is arguably as important as that between the different services, such as water and electricity.

Competition has been seen as being fostered by liberalizing trade and this has raised hopes and fears among protagonists and opponents, respectively. In this context, the impact of the World Trade Organization's General Agreement on Trade in Services (GATS) on environmental services has been slight and the main contribution to be made by competition policy could prove to be at the micro-level. In that regard, it may be more helpful to refer to de-monopolization rather than competition.

Ancillary