THE DOG IN THE MANGER: DEFINING THE STATE'S ENTREPRENEURIAL ROLE IN LATIN AMERICA

Abstract

Peruvian sources of fresh water supply are abundant, yet Peruvians have the second lowest level of access to piped water and sewerage in South America. Only 72 percent of households have piped water (but don’t dare to drink it from the faucet) and only 51 percent have access to sewerage. According to government figures, 40 percent of piped water is not billed because of leaks and unauthorized connections.[1] Current estimates project that Peru needs to invest US$4.6 billion in infrastructure just to reach the levels of piped water and sewage of Colombia and Chile.[2] Opposers to the privatization of the state-owned Peruvian water and sewage system (mainly the government enterprises’ labor unions and advocates for middle class consumers with access to piped water and sewerage) argue that water is a human right, not a commodity. Meanwhile, per each cubic meter of water that is delivered by tanker-trucks, the less fortunate (about ten million of them) pay roughly ten times the amount charged by government enterprises to piped water users, as dengue-fever (a tropical disease) outbreaks have become common in the lower-income settlements located in the desert areas outside of Lima due to lack of sewerage. [1] See Private Investment In Peru's Water Industry, The Economist (February 16th, 2006), at 36-38. [2] Estimates by the Instituto Peruano de Economía.