I have long tracked the nationwide debate sparked by public-private partnership (PPP) policies in Tanzania’s water sector, and I have long observed that this discussion has moved far beyond the technical scope of infrastructure financing to develop into an ideological dispute over the future roles of the state, the market, and public service delivery.
Idrissa Kwekweita, a political commentator who published work on the Sauti ya Ujamaa platform, put forward the core argument of the opposing camp, claiming that the PPP model currently being rolled out is nothing more than a disguised form of privatisation for the water sector.
The public grievances underpinning these criticisms are fully justified: Tanzanian residents’ anger at long-standing flaws in local water institutions, including operational inefficiency, pipe network leakage, insufficient service coverage, and a lack of accountability mechanisms, is entirely well-founded. However, I must raise a core, reality-centred question: if the PPP model is rejected completely, where will the massive funds needed to upgrade Tanzania’s already decaying water infrastructure come from?
In my view, Tanzania’s current water crisis is fundamentally structural rather than an issue reducible to an ideological label.
Data from Tanzania’s official 2015–2020 water sector report corroborates this: over the same period, only 11 percent of the country’s water sector funding came from government fiscal budgets, while the remaining 89 percent relied entirely on donors and international development partners.
To clear up misunderstandings, I will address the opposing camp’s two core criticisms one by one. First is the oversimplified claim that “PPP equals privatisation.”
Under Tanzania’s current legal framework, the state permanently retains ownership of core infrastructure in the water sector, and maintains statutory authority to regulate water prices and oversee all stages of service delivery.
Second is the widespread concern that “private capital will only focus on profitable urban areas and ignore poor communities.”
In fact, across four major global infrastructure sectors- electric power, telecommunications, transportation, and banking- a common universal logic is widely adopted: revenue from mature, profitable service hubs is used to support the expansion of services to less developed regions, and the applicability of this logic leaves space for further in-depth discussion.
Can states design sound institutional frameworks that leverage mature market forces to subsidise the expansion of water services to underserved communities?
Our core argument is that a modern, well-regulated Public-Private Partnership (PPP) framework is precisely the key pathway to address this question: it can resolve Tanzania’s current water development dilemma and refute criticisms opposing the entry of private capital into the water sector.
First, in response to the counterclaim that “existing public water systems shield low-income residents from prohibitive water costs”, we dismantle this assertion using empirical data from official Tanzanian government reports.
Currently, urban households spend an average of Sh5,000 per day to purchase water from informal water vendors, while rural households spend Sh2,000 per day for unreliable access to water.
The price of water from existing public systems is 46 percent below actual operating costs, a gap that has directly led to long-term underinvestment and ageing infrastructure.
Nationwide, 43 percent of treated freshwater is lost to leaks, illegal connections, and other issues, totalling nearly Sh2 trillion in losses over seven years.
This translates to annual economic losses of roughly $2.4 billion, accounting for 3.2 percent of Tanzania’s GDP. Citizens also spend nearly 1 billion hours each year coping with water supply shortages.
The country’s water use breakdown is 85 percent for agriculture, nine percent for domestic use, and one percent for industrial use.
Tanzania has 29.4 million hectares of land suitable for irrigation, but only 727,280 hectares had been developed as of 2022.
The government’s 2028 development target is to exceed 1.6 million hectares, a core development goal tied to national food security and industrialisation that is impossible to meet relying solely on public funding.
The crises of Bolivia’s “Water War” and Argentine social unrest cited by critics stemmed from weak regulation, flawed contracts, political instability, and governance failures, not from private capital itself.
Well-regulated PPP models implemented across Asia, Africa, Europe, the Americas, and Latin America have delivered outcomes, including expanded service coverage, reduced water leakage, and improved service quality.
In fact, private capital is already deeply embedded in Tanzania’s core economic sectors, including banking, mining, telecommunications, energy, and manufacturing.
The core challenge for the country’s water sector has never been whether to introduce private capital, but how to establish a compliant, standardised PPP framework.
Can Tanzania build institutions strong enough to ensure that capital serves the country’s long-term transformation rather than becoming a tool for private actors to pursue narrow self-interest?
To achieve this goal, reliance must be placed on transparency, accountability, regulation, and political discipline, not merely emotional slogans.
David Kafulila, a guest speaker at a previous policy forum, argued that “PPPs are not free lunch”, which highlights the core reality of related debates: all infrastructure construction, modernisation, and development come with costs.
Tanzania must choose between the traditional state-led model, which is struggling to bear the pressure of rising demand and ageing infrastructure, or a new smart, accountable system that can unlock investment while protecting public interests.
The real challenge has never been rejecting capital, but preparing to regulate and manage capital wisely.
Dr Bravious Kahyoza is an economist and World Bank-certified PPP expert
