ABSTRACT
The pricing and political problems outlined in the previous chapter are compounded by fact that the business climate in most developing countries is not conducive to investment in such a risky sector. Key elements such as macro-economic stability, rule of law, fiscal management, regulatory institutions and the functioning of the judicial system are in need of improvement in many developing countries. An enabling policy environment is critical for access to finance for the sector. This situation is exacerbated by the decrease in public and private investment in infrastructure in general and the water and sanitation sector in particular.
