In January 1997 the Government of the Philippines awarded two long-term concession contracts, handing over to private consortia the responsibility to operate and expand water and wastewater services in Greater Manila. With a combined population of 11 million in the two service areas and investment needs projected at $7 billion over the contract period, the transaction was hailed as the largest water concession in the world. By tendering the contract competitively, the government was able to deliver an immediate benefit to customers: the winning bidders not only accepted contractual...