20 years of WASH project financing in Latin America and the Caribbean: lessons and insights

ABSTRACT

Schematic representation of the study framework, methodology, main findings, and conclusions on WASH project financing in Latin America and the Caribbean.

This study explores the financing of water, sanitation, and hygiene (WASH) projects in Latin America and the Caribbean (LAC) over the last 20 years (2004–2024). It analyses 658 development bank (DB) projects, 167 private infrastructure projects, and country and WASH sector factors, to identify financing trends and potential impacts on project and sector success. The data were submitted to systematic quantitative review, comparative, statistical, and/or regression data analyses. The results underscore the importance of DB involvement for sector success (e.g., the amounts committed by DBs had a positive correlation with water supply and sanitation coverages of 0.337 and 0.297, significant at the 0.01 level, respectively) while emphasizing the need to reduce reliance on grants (high statistically significant impact on the percentage of population using at least basic drinking water services, with a p-value <0.001 and a correlation of −0.333 significant at the 0.01 level). DBs could more effectively leverage the confidence they instill in the financial community (i.e., their ‘halo effect’) to attract co-financiers. It is important to strengthened governance (high statistically significant impact on drinking water coverage with a p-value <0.001 and correlation of 0.644 significant at 0.01 level) and enhance transparency to increase financiers' interest in the WASH sector.