Ilembe Siza Water Concession

This case study examines a 30-year water and sanitation concession between the Ilembe District Municipality and Siza Water Company (Pty) Ltd in South Africa. Established in 1999, the partnership initially struggled with underinvestment and profitability but evolved into a profitable and effective service provider by managing systemic public sector capacity constraints and improving infrastructure.

• Siza Water Company (Pty) Ltd entered a 30-year concession in 1999 with the Borough of Dolphin Coast in the Ilembe District of KwaZulu-Natal to "oversee manage and implement the provision of water and sanitation services within the theMunicipal boundary". The concession area covers 12,5km² and serves between 55,000 and 60,000 users across urban, rural, residential, commercial, and light industrial sectors.
• The PPP faced significant early barriers, including a "historical legacy of underinvestment" and a lack of funding from local government structures, which resulted in Siza Water declaring no profits until approximately 2004/5. Other early challenges included public sector capacity constraints due to a "lack of administrative and technical know-how", poor data collection—especially for poorer communities—and an "unprofitably small concession area".
• The partnership's performance improved after 2005/6, aided by a "boom period of the 2005-2008" that increased residential and business demand. While performance was initially mixed and skewed toward wealthier areas, the overall impact has been an improvement in "levels of water loss, water quality, faults and maintenance".
• Residual barriers persist, including a dependency on the state-owned entity Umgeni Water for bulk water supply, "high staff turnover in the public sector department responsible for contract management", and delays in permit authorization by the public sector partner.
• Siza Water improved the PPP's outcome by building a close relationship with the Ilembe District Municipality, taking more responsibility for consumer communication, and implementing a "negotiated expansion strategy" to ensure a sustainable number of consumers.

APA

South African Institute of International Affairs (2012). Ilembe Siza Water Concession. https://saiia.org.za/saiia-toolkit/ilembe-siza-water-concession/

Chicago

South African Institute of International Affairs. Ilembe Siza Water Concession. 2012. https://saiia.org.za/saiia-toolkit/ilembe-siza-water-concession/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Ilembe Siza Water Concession |date=24 July 2012 |url=https://saiia.org.za/saiia-toolkit/ilembe-siza-water-concession/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2012ilembe, author = {{South African Institute of International Affairs}}, title = {{Ilembe Siza Water Concession}}, institution = {South African Institute of International Affairs}, year = {2012}, month = jul, url = {https://saiia.org.za/saiia-toolkit/ilembe-siza-water-concession/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }