Ability and willingness to pay for water supply service in the Gaza Strip

Water scarcity in the Gaza Strip forms a real crisis for people in this area. The ground water is the main source for domestic use in the Gaza Strip and it suffers from rapid decline in both quality and quantity. The crisis should be managed carefully to secure the water demand with an appropriate price. The water sector cannot be managed successfully without a suitable water pricing system because any improvement process for the water supply service will increase the cost of this service. Water pricing must be integrated with other measures to ensure that environmental, economic and social objectives are met cost effectively. Globally, evaluation of water pricing systems continues to be a very essential issue. Subsequently, this paper reports on a research that studied the ability and willingness of customers to pay for improved water supply service in the Gaza Strip. This factor is an important factor, which strongly affects water pricing systems. Seven hundred and sixty (760) questionnaires were distributed among the subscripted households in the governorates of the Gaza Strip. Only 609 of them were used in data analysis. The results of the study revealed that the willingness to pay (WTP) for improved water supply service, that matches the WHO standard, was about 3.0 NIS/m3. This price also was affordable by all income groups. This study concentrated on socioeconomic factors that have not been given sufficient attention by previous studies. In other words, this paper has investigated the affordability and WTP for improved water supply service in the Gaza Strip. It was recommended in this study to build the water tariff structure, for the improved service that matches the WHO standards, on the average price 3 NIS/m3. The use of cross subsidy technique also was recommended to help the poor households that cannot afford the average price.