Region: Europe and Central Asia
Sector: Water and Sanitation
Armenia’s sixteen years of experience with public-private partnerships (PPPs) in the water sector is a rich illustration of how partnering with private operators can be done in a strategic manner to improve water services in a developing country. The Government took a phased and cautious approach to the PPP reform, gradually increasing the geographical scope of the PPPs as well as the level of transfer of risks to private operators while learning lessons as it moved forward.
The sequence of PPPs was as follows:
Armenia’s experience with water PPPs began in 2000 with a 5-year management contract in the capital city Yerevan, which had a service area of about 1.2 million people;
In 2004, a management contract was put in place for the Armenia Water and Sewerage Company (AWSC), a utility that covered almost 320 cities, 37 urban centers and 283 rural communities with a total population of about 620,000 spread through most of the secondary cities, towns and villages in the rest of the country;
In 2006, the management contract in Yerevan was replaced by a 10-year lease contract whereby a private operator took all commercial and operating risks and was remunerated through collection of tariff revenues;
In 2009, another management contract was put in place for the 3 regional utilities that were still under public management. This contract centered around the cities of Lori, Shirak and Nor Akunq (about 330,000 people).
Updated: April 12, 2022