Sedapar needs "radical" changes" - shareholders' chairman

Sedapar, the municipal water utility (EPS) operating in Peru's southern city Arequipa, has to be profoundly reformed, local newspaper La República quoted Manuel Vera, the chairman of the shareholders' meeting, as saying. "The firm needs radical changes to improve its services," Vera said. Beyond reshuffling the board, the whole water pipe network has to be upgraded because "service interruptions are not caused by the firm, but by pipes that have been there for over 30 years." However, Sedapar, which is the country's second largest water utility, currently lacks the financial resources to invest in new infrastructure, Vera added. The central government has just approved a reform of the municipal water utility industry aimed at overhauling the sector by introducing a new watchdog, Otass, and creating more room for private operators to step in and carry out investments. Within this context, an eventual privatization of Sedapar is not the answer, because it would lead to tariff hikes, Vera added.