International Water Services Guayaquil Interagua C. Ltda.

MIGA achieved several firsts with the signing of an $18 million guarantee for the rehabilitation and expansion of water services in Guayaquil, Ecuador. The project represents MIGA's first coverage of a water project and of a performance bond. The guarantee offers protection against the risks of expropriation and war and civil disturbance for an investment by International Water Services B.V. of the Netherlands in an Ecuadorian subsidiary. It also covers a performance bond—posted in accordance with the 30-year concession—that guarantees the company's successful management, expansion, and operation of the water services, against the risk of wrongful call.

The investment aims to improve the services and operating performance of the existing municipal water utility, especially to poor areas that have little access to potable water and poor sanitary conditions, by reducing the amount of water that is unaccounted for and increasing cash collection. During the first five years of the concession, improvements must be made in the quality of water services, as well as in the number of potable water and sewage connections. Service coverage is expected to increase by 30-40 percent. The new project is expected to help improve health and living conditions for the local population, while reducing the cost of water for those who currently rely on other sources of water.