Water supply and sanitation in Egypt

Egypt Egypt Egypt , officially the Arab Republic of Egypt, Arabic: , is a country mainly in North Africa, with the Sinai Peninsula forming a land bridge in Southwest Asia. Egypt is thus a transcontinental country, and a major power in Africa, the Mediterranean Basin, the Middle East and the Muslim world... : Water and Sanitation

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|-
!align="center" bgcolor="lightblue" colspan="3"|Data
|-
!align="left" valign="top"|Water coverage (broad definition)
|valign="top"| 99% (2008)
|-
!align="left" valign="top"|Sanitation coverage (broad definition)
|valign="top"| 94% (2008)
|-
!align="left" valign="top"|Continuity of supply (%)
|valign="top"| N/A
|-
!align="left" valign="top"|Average urban water use (l/c/d)
|valign="top"| 200
|-
!align="left" valign="top"|Average urban water tariff (US$/m³)
|valign="top"| 0.05
|-
!align="left" valign="top"|Share of household metering
|valign="top"| low
|-
!align="left" valign="top"|Investment in WSS
|valign="top"| 9.05 Billion US$ in the last 20 years
|-
!align="left" valign="top"|Share of self-financing by utilities
|valign="top"| N.A.
|-
!align="left" valign="top"|Share of tax-financing
|valign="top"| N.A.
|-
!align="left" valign="top"|Share of external financing
|valign="top"| N.A.
|-
!align="center" bgcolor="lightblue" colspan="3"|Institutions
|-
!align="left" valign="top"|Decentralization to municipalities
|valign="top"| No
|-
!align="left" valign="top"|National Water and sanitation company
|valign="top"| Holding Company for Water and Wastewater
|-
!align="left" valign="top"|Water and sanitation regulator
|valign="top"| Egyptian Water Regulatory Agency
|-
!align="left" valign="top"|Responsibility for policy setting
|valign="top"| Ministry of Housing, Utilities and Urban Communities
|-
!align="left" valign="top"|Sector law
|valign="top"| None
|-
!align="left" valign="top"|Number of urban service providers
|valign="top"| 23 subsidiaries of the Holding Company for Water and Wastewater
|-
!align="left" valign="top"|Number of rural service providers
|valign="top"| n/a
|-
|}

Water supply and sanitation in Egypt is characterized by both achievements and challenges. Among the achievements are an increase of piped water supply between 1990 and 2006 from 89% to 99% in urban areas and from 39% to 82% in rural areas despite rapid population growth; the elimination of open defecation

Defecation

Defecation is the final act of digestion by which organisms eliminate solid, semisolid or liquid waste material from the digestive tract via the anus. Waves of muscular contraction known as peristalsis in the walls of the colon move fecal matter through the digestive tract towards the rectum...

in rural areas during the same period; and in general a relatively high level of investment in infrastructure. Access to an improved water source

Improved water source

According to the Joint Monitoring Program for Water Supply and Sanitation by the World Health Organization and UNICEF the following are considered as "improved" water sources:* household connections* public standpipes* boreholes* protected dug wells...

in Egypt is now practically universal with a rate of 99%. On the institutional side, the separation between regulation and service provision has been somewhat improved through the creation of a national Holding Company for Water and Wastewater in 2004 and of an economic regulator, the Egyptian Water Regulatory Agency (EWRA), in 2006.

However, many challenges remain. Only about one third of the population is connected to sanitary sewer

Sanitary sewer

A sanitary sewer is a separate underground carriage system specifically for transporting sewage from houses and commercial buildings to treatment or disposal. Sanitary sewers serving industrial areas also carry industrial wastewater...

s. Partly because of low sanitation coverage about 17,000 children die each year because of diarrhea

Diarrhea

Diarrhea , also spelled diarrhoea, is the condition of having three or more loose or liquid bowel movements per day. It is a common cause of death in developing countries and the second most common cause of infant deaths worldwide. The loss of fluids through diarrhea can cause dehydration and...

. Another challenge is low cost recovery due to water tariffs that are among the lowest in the world, requiring government subsidies to the country's 14 public water and sewer companies even for operating costs. Poor operation of facilities, such as wastewater treatment plants, is also an issue.

Foreign aid from the United States, the European Union, France, Germany, the World Bank and Arab donors remains important, both in terms of financing and in terms of technical assistance and - particularly in the case of Western donors - in promoting sector reform aiming at higher levels of cost recovery and more efficient service provision. Private sector participation in operating water and sanitation systems has so far been limited mainly to Build-Operate-Transfer

Build-Operate-Transfer

Build-own-operate-transfer or build-operate-transfer is a form of project financing, wherein a private entity receives a concession from the private or public sector to finance, design, construct, and operate a facility stated in the concession contract...

(BOT) arrangements for large facilities.

Access

99% of Egyptians have access to an improved water source

Improved water source

and 94% had access to improved sanitation

Improved sanitation

According to the Joint Monitoring Programme for Water Supply and Sanitation by the World Health Organization and UNICEF the following are considered as "improved" sanitation:* connection to a public sewer* connection to a septic system* pour-flush latrine...

in 2008.

Access to Water and Sanitation in Egypt (2008)
		Urban (43% of the population)	Rural (57% of the population)	Total
Water	Broad definition Improved water source According to the Joint Monitoring Program for Water Supply and Sanitation by the World Health Organization and UNICEF the following are considered as "improved" water sources:* household connections* public standpipes* boreholes* protected dug wells...	100%	98%	99%
Water	House connections	99%	87%	92%
Sanitation	Broad definition Improved sanitation According to the Joint Monitoring Programme for Water Supply and Sanitation by the World Health Organization and UNICEF the following are considered as "improved" sanitation:* connection to a public sewer* connection to a septic system* pour-flush latrine...	97%	92%	94%
Sanitation	Sewage	n/a	n/a	n/a

These figures show that Egypt is much better off than other African countries as it already reached the Millennium Development Goals

Millennium Development Goals

The Millennium Development Goals are eight international development goals that all 193 United Nations member states and at least 23 international organizations have agreed to achieve by the year 2015...

of halving the number of people without proper access to save water and sanitation by 2015. Furthermore, especially the figures on water supply are a result of huge investments which have been made in the infrastructure sector during the last thirty years.

Continuity of supply

According to the government's National Research Center, 40 percent of Cairo's inhabitants do not get water for more than three hours per day and three large districts do not receive any piped water. Demonstrations concerning this issue took place in Suez

Suez

Suez is a seaport city in north-eastern Egypt, located on the north coast of the Gulf of Suez , near the southern terminus of the Suez Canal, having the same boundaries as Suez governorate. It has three harbors, Adabya, Ain Sokhna and Port Tawfiq, and extensive port facilities...

, where 500 people blocked a main road to Cairo. According to a survey in governorate of Fayoum, 46% of households complained about low water pressure, 30% about frequent water cuts and 22% complained that water is not available during day time. These problems lead many people to use water from canals which could be hazardous to health. Service quality is particularly poor in mature informal districts where about 20% of the Egyptian population lives.

Drinking water quality

It is estimated that each year about 17,000 children die from diarrhea

Diarrhea

. One reason is that drinking water quality is often below standards. Some water treatment plants are not maintained properly and are thus inefficient in removing parasites, virus

Virus

A virus is a small infectious agent that can replicate only inside the living cells of organisms. Viruses infect all types of organisms, from animals and plants to bacteria and archaea...

es and other parasitic microorganisms. In 2009, a study by the Ministry of Health showed that drinking water for half a million people in Asiut was unfit for human consumption. As of June 2011, nothing had been done to address the problem. Chlorination system of wells, which had been installed years ago because high levels of bacteria had been detected in the groundwater, failed for lack of maintenance and have been shut down so that untreated water is provided to the residents.

Wastewater treatment

Egypt had more than 200 wastewater treatment plants in 2004. The capacity of Egypt's wastewater treatment plants was about 11 million cubic meters per day, serving approximately 18 million people. The number has increased 10 times between 1985 and 2005. The amount of water which is released into the Nile is 3.8 billion m³ per year, out of which only 35 % was treated properly as of 2004.

The largest wastewater treatment plant in Egypt is located in Gabal el Asfar to the Northeast of Cairo, serving about 9 million people and treating 2 million cubic meters per day in 2009. The plant discharges into the Belbeis Drain and then into Bahr El Baqar Drain (BBD), which in turn drains to Lake Manzala

Lake Manzala

Lake Manzala is a brackish lake, sometimes called a lagoon, in northeastern Egypt on the Nile Delta near Port Said and a few miles from the ancient ruins at Tanis. It is the largest of the northern deltaic lakes of Egypt. As of 2008 it is 47km long and 30km wide.-Geography:Lake Manzala is long but...

170 km away from Cairo. The drain and Lake Manzala had been identified as "black spots" by the Egyptian Environmental Action Plan back in 1992. The quality of water improved substantially after the completion of the first stage of the plant in 1999, but the drain and the lake are still environmentally fragile. Tendering for further expansion of the plant with financing from the African Development Bank began in 2011. It would increase its capacity to 2.5 million cubic meters per day. A planned third stage would bring capacity to 3 million cubic meters per day, serving 12 million people and making Gabal al Asfar one of the largest wastewater treatment plants in the world.

Water resources

Egypt’s main source of freshwater

Freshwater

Fresh water is naturally occurring water on the Earth's surface in ice sheets, ice caps, glaciers, bogs, ponds, lakes, rivers and streams, and underground as groundwater in aquifers and underground streams. Fresh water is generally characterized by having low concentrations of dissolved salts and...

is the Nile River. The river supplies 56.8 billion m³ of freshwater every year, which represents 97 % of all renewable water resources in Egypt. Average rainfall in Egypt is estimated at 18 mm or 1.8 billion m³ per year. Furthermore, Egypt has four different groundwater

Groundwater

Groundwater is water located beneath the ground surface in soil pore spaces and in the fractures of rock formations. A unit of rock or an unconsolidated deposit is called an aquifer when it can yield a usable quantity of water. The depth at which soil pore spaces or fractures and voids in rock...

aquifer

Aquifer

An aquifer is a wet underground layer of water-bearing permeable rock or unconsolidated materials from which groundwater can be usefully extracted using a water well. The study of water flow in aquifers and the characterization of aquifers is called hydrogeology...

s: the Nile Aquifer, the Nubian Sandstone Aquifer, the Moghra Aquifer and the Coastal Aquifer.

These figures give an impression that Egypt is a water rich country but the growth in population makes it a water scarce country. Since 2005, Egypt is classified as a water scarce country as it has less than 1000 m³ of fresh water per year and capita. Furthermore, it is forecasted that in 2025 the population will reach 95 million, which would mean a per capita share of only 600 m³ per year.

Water use and hygiene behavior

At the national level, total domestic water use in Egypt is estimated at about 5.5 billion m³ per year or 8 % of total water use. This corresponds to an average of about 200 liter per capita per day (l/c/d), or almost twice as much as in Germany. However, actual domestic water use is lower because of network losses, and furthermore it varies considerably between different localities in Egypt. For example, the installed drinking water supply capacity ranges from 70 l/c/d in upper Egypt to 330 l/c/d in Cairo.

At the local level, a study on water and sanitation in two villages in the Nile Delta conducted in the late 1980s provides some insights into water use and hygiene behavior in rural areas at the time. The inhabitants had access to three water sources: piped water from household connections or public standpipes; shallow wells with handpumps; and canal water. Canals were used by many women for laundry and washing domestic utensils, and for cleaning vegetables and grain. Women preferred canal water to groundwater because canal water was softer

Hard water

Hard water is water that has high mineral content . Hard water has high concentrations of Ca2+ and Mg2+ ions. Hard water is generally not harmful to one's health but can pose serious problems in industrial settings, where water hardness is monitored to avoid costly breakdowns in boilers, cooling...

and was not brackish

Brackish water

Brackish water is water that has more salinity than fresh water, but not as much as seawater. It may result from mixing of seawater with fresh water, as in estuaries, or it may occur in brackish fossil aquifers. The word comes from the Middle Dutch root "brak," meaning "salty"...

. The surroundings of standpipes were dirty and the residents did not feel responsible to maintain them, seeing this as a responsibility of the government. Shallow wells were contaminated. There was no sewerage and no system to dispose greywater

Greywater

Greywater is wastewater generated from domestic activities such as laundry, dishwashing, and bathing, which can be recycled on-site for uses such as landscape irrigation and constructed wetlands...

. Household latrines were used primarily by women. Men used sanitary facilities at mosques or defecated in canals. Children defecated openly in the streets or fields. Emptying of latrines was done by donkey carts or trucks which empty their load into canals. As a result of conditions like these infant mortality remained high despite the government's provision of water through standpipes. More recent survey data show that hygiene behavior has improved since then at the national level: The rate of open defecation in rural areas declined from 17% in 1990 to less than 1% in 2005. While provision of water supply alone had only a limited impact on child mortality, subsequent improvements in sanitation and hygiene behavior contributed to significantly reduce child mortality from 90/1000 births in 1990 to 23 in 2008.

Infrastructure

As of 2008, there were 153 large and 817 small drinking water treatment plants, as well as 239 wastewater treatment plants. The length of the water distribution networks was 107,000 km and the length of the wastewater collection network was 29,000 km.

From the 19th century to contemporary Egypt

The first modern water companies in Egypt were created by European private investors in Alexandria and Cairo in the 1860s under the Khedivate of Egypt

Khedivate of Egypt

The Khedivate of Egypt was an autonomous tributary state of the Ottoman Empire.- Rise of Muhammad Ali :The Egypt Eyalet was an eyalet of the Ottoman Empire. The eyalet was ruled locally by the Mamluk military caste and their various beys , who started to fight amongst themselves for control of...

. At the same time, the French-British Suez Canal Company operated, alongside the Suez Canal itself, the drinking water supply for the Suez Canal cities Port Said

Port Said

Port Said is a city that lies in north east Egypt extending about 30 km along the coast of the Mediterranean Sea, north of the Suez Canal, with an approximate population of 603,787...

, Suez

Suez

and Ismailia

Ismaïlia

-Notable natives:*Osman Ahmed Osman, a famous and influential Egyptian engineer, contractor, entrepreneur, and politician, was born in this town on 6 April 1917....

, the latter city having been created by the company.

The Cairo

Cairo

Cairo , is the capital of Egypt and the largest city in the Arab world and Africa, and the 16th largest metropolitan area in the world. Nicknamed "The City of a Thousand Minarets" for its preponderance of Islamic architecture, Cairo has long been a centre of the region's political and cultural life...

and Alexandria

Alexandria

Alexandria is the second-largest city of Egypt, with a population of 4.1 million, extending about along the coast of the Mediterranean Sea in the north central part of the country; it is also the largest city lying directly on the Mediterranean coast. It is Egypt's largest seaport, serving...

water companies were nationalized in 1956, along with the nationalization of the Suez Canal by the socialist government of Gamal Abdel Nasser

Gamal Abdel Nasser

Gamal Abdel Nasser Hussein was the second President of Egypt from 1956 until his death. A colonel in the Egyptian army, Nasser led the Egyptian Revolution of 1952 along with Muhammad Naguib, the first president, which overthrew the monarchy of Egypt and Sudan, and heralded a new period of...

. For the promotion of investments in provincial cities, two state agencies were created, one in charge of water supply and one in charge of sanitation.

Economic opening and the arrival of foreign aid in the 1970s

With the economic opening of Egypt under the government of Anwar Sadat

Anwar Sadat

Muhammad Anwar al-Sadat was the third President of Egypt, serving from 15 October 1970 until his assassination by fundamentalist army officers on 6 October 1981...

in the 1970s (Infitah

Infitah

The Infitah was Egyptian President Anwar Sadat's policy of "opening the door" to private investment in Egypt in the years following the 1973 October War with Israel...

) substantial foreign aid arrived. In particular, USAID provided assistance for water supply and sanitation in Greater Cairo, Alexandria and the Suez Canal cities. Provincial cities and rural areas, however, were initially neglected. About half of the investments undertaken at that time were made in Cairo and Alexandria, although only a quarter of the population lived there.

Achievements. As a result of massive externally funded investments access to water supply and sanitation increased substantially during the next decades. For example, water production capacity increased from 5.5 million cubic meters per day in 1982 to 21 million in 2004 and per capita water consumption increased from 130 to 275 liter per day during the same period.

Challenges. However, the organizations in charge of operating and maintaining the infrastructure were weak in terms of financial and human resources, especially in provincial Egypt, so that service quality remained poor. A World Bank sector study in the late 1970s observed “dismal conditions”, such as
Concerning inadequate cost recovery, in provincial Egypt only about one-third of the operating cost was recovered. Rural water supply was mostly through standpipes that provided water for free. Revenues were transferred to the Central Government, which in turn provided subsidies that were insufficient for proper operation and maintenance.

Only one of the six problems diagnosed in the 1970s has been resolved: investment levels have substantially increased and have remained high. However, the other problems still largely prevail more than three decades later despite some improvements as a rsult of two sector reforms carried out in 1981 and 2004. One particular remaining problem is the fragmentation of responsibilities.

Sector fragmentation and its consequences. The structure of the water sector in the mid-1970s illustrates the problem of fragmentation:

In Cairo and Alexandria water infrastructure was owned and operated by local water authorities - Alexandria Water General Authority - AWGA - and General Organization for Greater Cairo Water Supply-GOGCWS;
in the Suez Canal cities both water and sewer infrastructure were owned and operated by the Suez Canal Authority (SCA);
the General Organization for Potable Water (GOPW) built and operated seven regional water systems, mainly in the Nile delta provinces;
115 municipalities owned and operated water systems in the larger provincial towns; and
governorate housing directorates operated about 1250 rural water supply systems relying on boreholes or wells serving those areas not covered by municipalities or GOPW.

The responsibility for wastewater collection and disposal systems was almost equally fragmented. It consisted of:

17 municipal systems of which Cairo's and Alexandria's were by far the largest. They were owned and operated by the General Organization for Greater Cairo Sanitary Drainage (GOGCSD) and Alexandria General Organization for Sanitary Drainage (AGOSD), respectively.
In provincial Egypt, investment in sewerage systems was the responsibility of the General Organization for Sewerage and Sanitary Drainage (GOSSD).
Operation of such systems, however, was the responsibility of municipalities.

The planning of infrastructure for water supply and sanitation was separated between two organizations, GOPW and GOSSD. As a result, some towns or neighborhoods received access to piped water supply, but not to sewers, which led to a deterioration of the hygiene situation.

The 1981 reforms: Reduced fragmentation and creation of public companies

To remedy this situation, donors pushed for a sector reform. In order to promote the reforms they also proposed to finance two projects in the Nile Delta, one in Beheira Governorate

Beheira Governorate

Beheira Governorate is a coastal governorate in Egypt. Located in the northern part of the country in the Nile Delta, its capital is Damanhur.-Overview:Beheira governorate enjoys an important strategical place, west of the Rosetta branch of the Nile...

financed by the World Bank and one in Kafr el-Sheikh Governorate

Kafr el-Sheikh Governorate

Kafr el-Sheikh Governorate is one of the governorates of Egypt. It lies in the northern part of the country, along the western branch of the Nile in the Nile Delta. Its capital is the city of Kafr el-Sheikh.-History:...

financed by Germany.

The government initiated the reform in 1981 with two key elements: First, it merged the water and sanitation investment agencies GOPW and GOSSD in a single new entity called NOPWASD. Second, it promoted the creation of autonomous water and wastewater companies in each governorate, following the example of the existing companies in Cairo and Alexandria. However, the central government did not push hard for their creation. Two decades later only three such companies were created.

The Water Companies in the Nile Delta. The governor of Beheira governorate, located next to Alexandria, created the first such company, the Beheira Water Company, by decree in 1981. With financing from the World Bank and France, facilities in the governorate were renovated and expanded. This led to some positive results: water supply became continuous and cost recovery for operating costs was achieved. However, the project took 13 years to complete, 7 years longer than expected and experienced 67 percent cost overruns.

Two more water companies were created in the late 1980s, both also in the Nile Delta governorates and under the influence of external financiers: the Damietta

Damietta

Damietta , also known as Damiata, or Domyat, is a port and the capital of the Damietta Governorate in Egypt. It is located at the intersection between the Mediterranean Sea and the Nile, about north of Cairo.-History:...

water company with support from the World Bank and the Kafr el-Sheikh water and wastewater company with support from Germany. In other governorates, such as in Daqahliya, resistance from the governors and from NOPWASD prevented the creation of a water company despite pressure by external donors.

The three water companies were less successful than expected. A 1991 USAID report concluded:
Public Economic Authorities in other governorates. Seven other governorates (Aswan Governorate

Aswan Governorate

Aswan Governorate is one of the governorates of Egypt. The southernmost governorate in Upper Egypt, its capital is Aswan.The Aswan Governorate borders Qena Governorate to the north, Red Sea Governorate to the east, New Valley Governorate to the west, and Sudan to the south...

, Minya Governorate

Minya Governorate

Minya Governorate is one of the governorates of Upper Egypt. The name originates from the chief city of the governorate, originally known in Sahidic Coptic as Tmoone and in Bohairic as Thmonē , meaning “the residence”, in reference to a monastery formerly in the area...

, Beni Suef Governorate, Faiyum Governorate, Dakahlia Governorate

Dakahlia Governorate

Dakahlia Governorate is an Egyptian governorate lying north east of Cairo. Its area is about 3,500 km² and it has a population of about 5 million. The capital is Mansoura.-Overview:...

, Gharbia Governorate and Sharqia Governorate) created Public Economic Authorities for water supply which took over the responsibility to operate water supply systems from the former regional systems that had been operated by GOPW. These units had less scope for financial and managerial autonomy than the water companies.

National Water Pricing Policy. In 1985 the government adopted a National Water Pricing Policy with the objective to gradually reach full operation and maintenance cost recovery for water by 1991. The policy also introduced a sewer surcharge set at just 10% of the water bill. The policy also provided for incentives (10 percent of total income) in the form of bonuses to workers in the water industry. However, tariffs were not increased as foreseen by the policy.

Remaining challenges. In 2000, almost 10 years later, things had not much changed. A report by NOPWASD stated that institutional capacity and cost recovery in the sector remained low. Infrastructure continued to fall into disrepair, while the entities in charge of water supply and sewerage systems ran large deficits that were only partly covered through subsidies. At that time, the Alexandria Water Company was the only water company in Egypt to cover its operating costs. The report concluded that there was a “duplication of administrative entities, low cost recovery ratios, and lack of qualified management and modern management systems”. A few years later, another government report observed that water and wastewater service providers were overstaffed with poorly qualified and poorly paid employees, that there was no system to evaluate staff performance, that billing and collection were poor and done manually, that there was no system to respond to citizen complaints, and no procedures for maintenance.

The 2004 reforms: Creation of the Holding Company and private sector participation

Genesis of the reforms. When donors expressed their dissatisfaction with the poor performance of the sector, the government initiated another sector reform that, again, aimed at improving service quality, gradually attaining a financial equilibrium and improving staff skills. The Ministry of Housing charged NOPWASD with the elaboration of a diagnostic study and recommendations for reforms. This was to be done under the label of decentralization through the creation of commercially oriented companies at the governorate level, just as recommended two decades earlier. However, two new elements were added to the reforms: private sector participation and autonomous regulation.

The study was presented to the Cabinet of Ministers in 1998. The Cabinet charged the Ministry of Housing with the elaboration of two documents: a decree on the reorganization of the water and wastewater sector, as well as a law on public utility concessions for water and wastewater. Both were initially approved in principle by Cabinet in 2000. However, the water concession law was never passed. A decree for the creation of a regulatory agency was also circulated. The process of enacting the reforms took many more years. During this time the decree on the reorganization of the sector was modified, creating a Holding Company that would de facto compete with NOPWASD.

Creation of the Holding Company. In April 2004 the decree that created the Holding Company, which was to become a central institution of the sector, was enacted. The existing 7 water and wastewater companies (2 in Cairo, 2 in Alexandria, and the 3 in the Nile Delta) as well as the existing 7 Public Economic Authorities were all transformed into affiliated companies of the Holding Company. While the Holding Company did not become responsible for investment, it was responsible for the acquisition of equipment to modernize its affiliate companies and for training their staff. Also, it became a key interlocutor for foreign donors.

Creation of a regulatory agency. In 2006 the sector reforms were complemented by the creation of a regulatory agency, the Egyptian Water Regulatory Agency. The creation of an “autonomous” regulatory agency for utilities was a standard recommendation made by donors for infrastructure sector reforms in developing countries at that time. The agency's tasks include reviewing proposals for tariff adjustments, monitoring the application of technical standards and reviewing customer complaints. The agency also has a mandate to both promote and regulate private sector participation. These tasks overlap with the tasks of other agencies, such as the Holding Company (which also reviews proposals for tariff adjustments, alongside the Ministry of Housing and the Cabinet), the public companies (which also review complaints) and the PPP Central Unit (which also promotes private sector participation). Five years after its creation, the regulatory agency remains a relatively weak and marginal entity whose autonomy is doubtful.

Private sector participation. In 2006 the government created a Public-Private Partnerships (PPP) Central Unit in the Ministry of Finance to promote private greenfield investments in infrastructure across various sectors. In the water sector, the unit promoted large Build-Operate-Transfer (BOT) projects for new wastewater treatment plants in Cairo and Alexandria. The unit left the operation of the utilities untouched.

Implementing the reforms. With the passing of the reforms, tariffs in Greater Cairo were increased from an extremely low base level by 100% as a signal to donors that the reforms were serious. The Holding Company started a program to replace 800,000 non-functioning meters, created a central laboratory, procured SCADA

SCADA

SCADA generally refers to industrial control systems : computer systems that monitor and control industrial, infrastructure, or facility-based processes, as described below:...

and GIS systems for the public companies and established customer hotlines. Furthermore, the Holding Company established a performance benchmarking system including bonus payments that are paid to companies that improve their performance. As a result of the reforms, donors re-engaged in the sector.

Unresolved challenges. While the reforms addressed some issues, others remain unresolved. For example, sector fragmentation was not actually reduced. No organization was dissolved; instead several new organizations were created. Cost recovery is still very low; overstaffing has apparently even increased from about 6.5 employees per 1000 connections in the early 2000s to about 10 in 2008. Also, the separation of responsibilities for investment and operation in provincial Egypt has not been addressed: NOPWASD remains in charge of investment, while the Affiliated Companies are only in charge of operation.

Overcoming the separation of investment and operation?. In the absence of a comprehensive reform, European donors have begun to address this issue at the project level. Under the Improved Water and Sanitation Program (IWSP), approved in 2009, the water and sanitation companies will be responsible for carrying out investments, thus by-passing NOPWASD. IWSP is jointly funded by four European financiers and the Egyptian government with a volume of 295 million Euro for its first phase. However, the World Bank under its Integrated Sanitation and Sewerage Infrastructure Project approved in 2008 (USD 320m in two phases) continues to channel investments through NOPWASD.

Policy and regulation

Egyptian water sector policies are set by several ministries. The Ministry of Water Resources and Irrigation (previously called Ministry of Public Works and Water Resources) is the oldest ministry in Egypt. Its responsibility is to ensure that all users receive enough water. The Ministry of Housing, Utilities and Urban Communities supervises water authorities, which are responsible for the treatment and delivery of water. The Egyptian Environmental Affairs Agency is responsible for environmental affairs and the assessment and monitoring of water use. The Ministry of Health and Population is responsible for analyzing water quality. The Holding Company for Water and Wastewater was founded by decree in 2004, charged with responsibility for financial and technical sustainability to the local Governorate-based utilities. The process of increasing financial solvency, increasing service standards, creating efficient operations and maintenance systems, and overall self-sufficiency for the local companies, has shown uneven levels of progress. The Holding Company continues to take over financial responsibility for more Governorate companies through 2009.

Three committees have been introduced in order to ensure the coordination among the different agencies and to solve occurring conflicts among them. However, the Ministry of Water Resources and Irrigation and the Ministry of Housing, Utilities and Urban Communities seem to be the main actors when it comes to policy making processes concerning water supply and sanitation.

In 2006, the Egyptian Water Regulatory Agency (EWRA) has been established in order to carry out economic and technical regulation.

Public institutions

The Ministry of Housing, Utilities and Urban Communities (MHUUC) supervises all institutions in charge of providing water and sanitation services. Broadly speaking, these are two types of institutions: those in charge of investment and those in charge of operation. However, this separation is not always clear-cut, since some companies in charge of operation also carry out investments.

Two institutions are in charge of planning and supervision of infrastructure construction within their respective geographic areas:

the Cairo and Alexandria Potable Water Organisation (CAPWO) for the country's two largest cities
The National Organisation for Potable Water and Sanitary Drainage (NOPWASD) for the rest of the country excluding new communities.
The New Urban Communities Authority is responsible for water supply and sanitation investments in new communities, of which 22 with five million inhabitants have been built so far alongside with 29 drinking water plants, 10,000 km of water pipelines, 7,000 km of sewer pipelines and 26 wastewater plants.

The Holding Company for Water and Wastewater (HCWW) and its 23 affiliated companies are in charge of operation and maintenance of water and sanitation infrastructure. The Holding Company owns all water and sanitation infrastructure in Egypt. Its affiliated companies include:

The General Organization for Greater Cairo Water Supply (GOGCWS)
The Cairo General Organization for Sewerage and Drainage (CGOSD)
The Alexandria Water Company
Alexandria Water Company
The Alexandria Water Company is the water company of the city of Alexandria, Egypt. It was originally founded in 1860 as a private company and it operated as such for more than 100 years before it was nationalized under the rule of Gamal Abdel Nasser...

, AWCO
The Alexandria Sewer and Drainage Company (ASDCO)
19 affiliated companies, each covering one or more of Egypt's 29 governorates
Governorates of Egypt
Egypt is divided for administrative purposes into 27 governorates . Egyptian governorates are the top tier of the country's five-tier jurisdiction hierarchy. A governorate is administered by a governor, who is appointed by the President of Egypt and serves at the president's discretion...

and being in charge of both water supply and sewerage. The companies that cover several governorates include the Canal governorates (Suez
Suez
Suez is a seaport city in north-eastern Egypt, located on the north coast of the Gulf of Suez , near the southern terminus of the Suez Canal, having the same boundaries as Suez governorate. It has three harbors, Adabya, Ain Sokhna and Port Tawfiq, and extensive port facilities...

, Port Said
Port Said
Port Said is a city that lies in north east Egypt extending about 30 km along the coast of the Mediterranean Sea, north of the Suez Canal, with an approximate population of 603,787...

and Ismailia
Ismaïlia
-Notable natives:*Osman Ahmed Osman, a famous and influential Egyptian engineer, contractor, entrepreneur, and politician, was born in this town on 6 April 1917....

), the Sinai (North and South Sinai governorates).

It is envisaged to establish affiliated companies in all governorates. However, in some governorates water and sewer services are still provided directly by the Holding Company.

Private sector participation

The government's support for private sector participation in water supply and sanitation is focused on build-operate-transfer

Build-Operate-Transfer

(BOT) for wastewater treatment plants, through which private finance is mobilized. This approach is limited to Cairo and Alexandria where external donors had become less keen to provide assistance. BOT contracts for two large wastewater treatment plants were in the tender process in May 2010: The upgrade of the 1.2 million cubic meter/day Abu Rawash plant and the New Cairo plant. But the private sector has also become involved in other functions beyond construction and consulting. For example, in Cairo, Suez and Ismailia

Ismaïlia

-Notable natives:*Osman Ahmed Osman, a famous and influential Egyptian engineer, contractor, entrepreneur, and politician, was born in this town on 6 April 1917....

a private company has been engaged to inspect water and wastewater networks, reduce leakage and install water meter

Water meter

A water meter is a device used to measure the volume of water usage. This article provides an overview of technical aspects of water meters. The worldwide prevalence of metering as well as its economic benefits and costs are covered in the separate article on water metering.In many developed...

Economic efficiency

The share of non-revenue water

Non-revenue water

Non revenue water is water that has been produced and is “lost” before it reaches the customer. Losses can be real losses or apparent losses . High levels of NRW are detrimental to the financial viability of water utilities, as well to the quality of water itself...

in Egypt was estimated at 34% in 2005. Other sources estimated the level at 40-50%. The good practice benchmark in the region is in Tunisia where the level of non-revenue water is 18%.

Egyptian utilities are overstaffed. They employed 98,500 staff in 2008 for 9.5 million subscribers, equivalent to more than 10 employees per 1000 connections. Good practice for water and sanitation utilities is to have less than 5 employees.

Financial aspects

Tariff level. Water and sewer tariffs in Egypt are very low in international comparison. Customer metering is low and where meters exist they often do not work, so that vast majority of urban water consumers are still charged a flat rate which is estimated according to the kind of building. In Cairo water tariffs were 29 piastres (about 5 US cents) per m³ in 2008. Sewerage is charged as a 25% surcharge to the water consumption.

Tariff setting. Tariffs are set centrally and are almost the same all over Egypt. In certain areas they were raised after the reforms of 2005. Tariff increases have to be approved by the holding company, the national water regulatory agency EWRA, the Ministry of Housing, the Cabinet of Ministers, the President of the Republic and the National Assembly. Tariffs have not been increased since 1992.

Cost recovery. The Egyptian government is highly subsidising the sector as the fees often comprise just 10 % to 25 % of the actual costs. The situation in cities is often better as cost recovery reaches up to 50% for water supply but on the other hand only 10% of the sanitation cost. Between 1982 and 2004, the government spent 65 billion Egyptian pounds (about 10.73 billion USD) for water supply and sanitation from which the revenues represented only 40%.

Investments in water supply and sanitation for Egypt exceeded 9.15 billion USD over the last 20 years. The National Master Plan for Water Supply and Sanitation estimates the investment needs for the 30 years from 2007 onwards at about 20bn Euro, out of which almost two thirds will be required for sanitation.

Financing. Investments are financed by the government with the support of external donors, as well as by the private sector. Between 2005 and 2010 Egypt received more than 1bn Euro in external aid for water supply and sanitation, out of which 30% were grants and the remainder soft loans with an average interest rate of 1%.

External cooperation

The European Union, France, Germany, the United States, the World Bank and Arab donors are among the most important external cooperation partners in the Egyptian water and sanitation sector. Other external partners in the sector include Denmark (technical assistance to Aswan Water and Wastewater Company), Italy (assistance to Cairo Water Company to procure leak detection equipment and provide training) Japan (technical assistance to Sharqeia Water and Wastewater Company), and the Netherlands (Integrated Sanitation Project). Donors increasingly fund projects jointly under the EU's Neighborhood Investment Facility (NIF), which supports the Improved Water and Wastewater Program (IWSP) in four governorates in the Delta during its first phase (Gharbia, Sharkia, Damietta, and Beheira) and four governorates in Upper Egypt during its second phase. IWSP pools loans from Germany, France and the European Investment Bank as well as a grant from the European Commission, which is used as an incentive for the other donors to pool their loans and to thus harmonize their procedures.

There is a water donor group co-chaired by the EU and the Netherlands.

European Union

The European Union provides budget support in the form of grants, institutional strengthening, the support of a National Master Plan for Water Supply and Sanitation, as well as financing for a radio network and water meters. Budget support is through a so-called Water Sector Reform Programme, including a first phase of 80 million Euro (2005-2009) and a second phase of 120 million Euro (2011-2015). Funds for institutional strengthening are provided to the Egyptian Water Regulatory Authority (6m Euro for 2008-2010 and 1.5m for 2011-2013) and the Holding Company (1.5m Euro for 2011-2013). The EU also co-finances investment jointly funded with bilateral European donors and the European Investment Bank

European Investment Bank

The European Investment Bank is the European Union's long-term lending institution established in 1958 under the Treaty of Rome. A policy-driven bank, the EIB supports the EU’s priority objectives, especially European integration and the development of economically weak regions...

, in particular the Improved Water and Sanitation Project IWSP.

France

The French Development Agency

French Development Agency

French Development Agency is the French international development agency.The Agence Française de Développement is a public institution providing development financing...

supports the IWSP (see above). It contributes with 40 million Euro to the total project cost of 295 million Euro.

Germany

Germany provides investment finance and technical assistance for projects in Qena and Kafr El Sheikh, as well as for the IWSP (see above), for which KfW

KFW

KFW may refer to:*Keith Fullerton Whitman , an American musician*KfW or Kreditanstalt für Wiederaufbau, a German public-sector financial institution...

is the lead donor. The technical cooperation agency GIZ is active in strengthening the capacity of the Holding Company and the two affiliated companies in Qena and Kafr el Sheikh.

United States

The United States has supported the development of Egypt’s water and sanitation sector since the early 1980s. It provided support to the sector reforms that established the holding company and the regulatory agency. USAID funded wastewater treatment plants throughout the country, including in Alexandria where it financed the expansion of the wastewater collection and treatment system to elimination raw wastewater discharge into the sea. It also financed technical assistance to the Alexandria General Water Authority (AGWA)

Alexandria Water Company

The Alexandria Water Company is the water company of the city of Alexandria, Egypt. It was originally founded in 1860 as a private company and it operated as such for more than 100 years before it was nationalized under the rule of Gamal Abdel Nasser...

through a strategic plan, training and a management information system. It also financed water treatment plants in villages in Minya and Beni Suef Governorate as well as in Mansoura City, the capital of Dakahlia Governorate, all in the Nile Delta. In 2008 USAID began two technical assistance projects, one to provide managerial systems and tools to utilities, the other aimed at "developing a strategic plan for the sector", "creating a framework for public-private partnerships", and "improving investment planning" at the national level.

World Bank

The Integrated Sanitation and Sewerage Infrastructure Project was approved in 2008 and is expected to end in 2014. Its main objective is the sustainable improvement of the sanitation and environmental conditions as well as the water quality in in the three Delta Governorates of Beheira, Gharbia and Kafr El-Sheikh. Furthermore, a local result-based monitoring and evaluation system will be established in order to improve sanitation coverage and thus environmental and health conditions. The project also contains a component of institutional development and capacity building. According to the World Bank, the project is the first large scale effort to address rural sanitation in Egypt. The total cost of the project is 201.5 million USD, out of which the World Bank provides more than half (120 million USD). A second phase of the project, extending it to four more governorates (Menoufia and Sharkia in the Delta, Assiut and Sohag in Upper Egypt) was approved in 2011 with a volume of 200 million USD.

External links

Ministry of Water Resources and Irrigation
Ministry of Housing, Utilities and Urban Communities
Holding Company for Water and Wastewater
Egypt Water Regulatory Agency (in Arabic)
Youtube
YouTube
YouTube is a video-sharing website, created by three former PayPal employees in February 2005, on which users can upload, view and share videos....

:Egypt's clean water crisis - Al Jazeera English Version 15 July 2007 about lack of clean drinking water in communities in the Nile Delta

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