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LESSONS:

Manila South Water Distribution Project

sector: Water and Other Urban Infrastructure and Services | country: Philippines

All three projects – Angat Water Supply Optimization Project (AWSOP), Manila South Water Distribution Project (MSWDP), and Umiray-Angat Transbasin Project (UATP) – were implemented by the same executing agency, and affected by the same issues, mainly delays resulting from the legal dispute about fiberglass pipes and the impact of privatization. They were also complex and, except UATP, involved several funding agencies. During implementation, the impact of one project was not always reflected in the planning of the other projects, which could have been mitigated by improved program management, and one senior person in charge of critical path monitoring, and risk management.

The failure to meet the projected nonrevenue water (NRW) reduction targets has greatly affected project benefits envisaged at appraisal. Considerable investment in water supply improvements has not resulted in the expected timely reduction of NRW, including in the project area of Manila South Water Distribution Project (MSWDP). It appears, that NRW reduction is far more complex and difficult than initially assumed. Projections for NRW reduction have major impact on the calculation of project benefits, and assumptions should therefore be conservative to avoid overestimation of project benefits at appraisal. Besides investing in system improvements, the utility must take responsibility for NRW reduction as an ongoing operational activity. Project design should make use of experiences gathered and lessons learned in NRW reduction from successful and efficient water utilities in the region.

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