A mixed-capital model for water and sanitation in Cartagena—one of the first instances of private sector participation in Latin America—raised public health standards and restored the coast, revitalizing this historic city.

Cartagena, Colombia has a population of around one million, and it has experienced rapid growth as the population doubled over the last two decades. Because of its history and spectacular natural attractions, Cartagena is also Colombia’s largest tourist area, welcoming around one million visitors annually. But just a few decades ago, Cartagena faced an uncertain future. By the mid-1990s, rapid population growth, unplanned urban development, and poor wastewater management had severely deteriorated Cartagena’s rich coastal resources, generating a public health and environmental crisis. At this time, less than half of the households had connections to a wastewater disposal system and none of the wastewater was treated.

Desperately in need of solutions to save the city, the District of Cartagena became one of the first municipalities in Colombia to introduce private sector participation in the water sector. This followed the 1994 Public Services Law that expanded the role of private operators and created a national tariff regulator alongside a service quality regulator. After many years of chronic inefficiencies in the provision of water supply and sanitation services (WSS), the District decided to liquidate the municipal utility and create a new public-private mixed capital enterprise with the World Bank’s support. In December 1994, Aguas de Barcelona (AGBAR, the privately owned Water Company of Barcelona), was selected as the partner of the municipality, and the mixed enterprise Aguas de Cartagena (ACUACAR) was created.

ACUACAR took over responsibility for the provision of WSS services in June 1995. The District was responsible for capital investments to expand the existing WSS system, while ACUACAR was responsible for capital expenditures to improve the existing system. Although this model is commonly used in Spain, this was the first time such an arrangement had been tried in Latin America.

Dual priorities

Tackling Cartagena’s public health risks and severe coastal environmental degradation in the mid-1990s required a long-term incremental approach. ACUACAR and the Cartagena Regional Environmental Authority (CARDIQUE) both played an important role. Strategic priorities over the last two decades included:

  • Improving water supply service in order to enhance ACUACAR’s financial stability and cost recovery;
  • Improving drainage in high-value economic areas that were subject to frequent flooding and sewer overflows into the streets and surrounding beaches;
  • Improving water circulation in the Ciénaga de la Virgen (an estuary that at the time received 60 percent of Cartagena’s untreated wastewater) with the construction of self-actuating tidal gates to increase flow into the Lagoon, and a long seawall within the estuary to route the tidal flows through the Lagoon and flush out the pollution; and
  • Collecting, treating, and disposing of Cartagena’s wastewater through the construction of a submarine outfall coupled with a preliminary wastewater treatment plant.

Results

Improvements have been dramatic. Coastal beaches are virtually pollution-free, and there have been significant improvements in the Cartagena Bay water quality and the ecological restoration of the Ciénaga de la Virgen. Moreover, through improvements in utility management, moderate increases in tariffs, and infrastructure investments, ACUACAR has been able to significantly improve the quality and efficiency of water and sanitation services and achieve sustainability. Potable water, which meets the national quality standards, is provided on a continuous basis to all households—even to the poorest neighborhoods.

Based on its tariff revenues, ACUACAR is able to cover all operating and maintenance costs, and help contribute to infrastructure investments. ACUACAR’s mixed capital model has become institutionalized in Cartagena, and the combination of local political control of the company combined with professional private sector management has performed remarkably well.

Key lessons

As with every significant public-private partnership, the officials behind the project faced many challenges along the way. Some of the lessons learned from Cartagena’s rich experience include:

An efficient and sustainable water utility is crucial for effective wastewater management—which is fundamental for coastal cities. The creation of ACUACAR in 1995 was a key component of Cartagena’s success.

Partnerships at the local, national, and international levels can facilitate and expedite environmental improvements. The Colombian national government formulated the policy framework for private participation in the water sector and enhanced environmental management, as well as providing significant financial support for Cartagena’s infrastructure. Strong partnerships at the local level between CARDIQUE, the District of Cartagena, and ACUACAR were indispensable to program continuity and coherence. International institutions, such as the World Bank, provided financial support and technical assistance.

Public relations, community outreach, and building consensus among local stakeholders is critical to planning and implementing wastewater programs. There is usually no obvious “best technical solution,” but in consultation with all stakeholders, a “preferred alternative” often emerges. The challenge is then to implement this approach in an expeditious manner to avoid further environmental degradation.

Comprehensive wastewater management is a long-term process and can take a decade or longer. In Cartagena, it took around five years (1995-2000) to ensure the proper policy, institutional planning, and financial arrangements were in place before the construction could commence, and then over ten years (2000-2013) before the wastewater treatment system could be fully constructed and commissioned.

Long-term, incrementally phased, and prioritized programs are necessary for water pollution control and environmental restoration. With the commissioning of the wastewater management system, Cartagena has completed the first phase of its long-term program to restore the coastal environment.

Submarine outfalls, combined with preliminary treatment, can be an appropriate solution for protecting coastal areas such as beaches, bays, and estuaries, while providing flexibility for future upgrades as necessary and when affordable. The feasibility of an outfall approach depends, of course, on the capacity of the receiving water body to assimilate the discharges and must be accompanied by extensive environmental, engineering, and social studies.

This article is adapted from and updates “Restoring the Coastal Environment in Cartagena, Colombia,” published in the World Bank’s Environment & Water Resources Occasional Papers.