This paper evaluates efforts made by development banks to promote tariff reform using covenants in infrastructure loan agreements. These covenants are evaluated within the broader context of tariff regulation in the water supply and sanitation sector. The paper outlines prerequisites for effective tariff regulation and reviews the experience with tariff regulation in developing countries and the current thinking regarding regulatory reform. Efforts by development banks to promote tariff regulation using loan covenants are often misdirected in light of the complexity of tariff regulation and the regulatory reform process.
Research Article|February 25 2013
Using covenants in loan agreements to promote tariff reform
Michael Fortin; Using covenants in loan agreements to promote tariff reform. Journal of Water, Sanitation and Hygiene for Development 1 September 2013; 3 (3): 315–321. doi: https://doi.org/10.2166/washdev.2013.059
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