Mexico to Pilot Output-Based Efficiency Investments in Water Utilities
A new World Bank loan to strengthen water operators in Mexico will include a pilot program aimed at improving the efficiency of the more sophisticated utilities by basing payments on results. The US$5 million output-based disbursement (OBDOutput-Based Disbursements in Mexico: Transforming the Water Sector in Guanajuato
A project in the Mexican state of Guanajuato shows how tying disbursements to specific outputs can provide incentives for effective implementation of a water sector strategy. The disbursements, from pooled government and World Bank loan funds, are made against connections to safe and reliable water service and improvements in utilities’ efficiency and wastewater treatment.
