The battle over water

by Claudia Theophilus     Published 16 Sep 2004     Source : Malaysiakini

Water privatisation is taking on an increasingly serious dimension in the developing world, particularly in the Asian region where major transformations are underway in the organisation and management of water resources.

Described as the oil of the 21st century, water is a major global concern mainly shared by south countries.

Water security issues has dominated many non-government organisation and civil society forums in recent years, mainly to discuss private efforts to reorganise water resources in terms of ownership, management, distribution and access.

The prevailing argument is that private money, as opposed to the government borrowing from banks, would cost more as it is based on borrowed capital with attached interest rates.

Last week, two workshops at the 5th Asia-Europe (ASEM) People's Forum in Hanoi shared experiences in the Philippines, the UK, Vietnam and Malaysia on attempts by the private sector to harness the world's most vital natural resource.
 
Strict regulations

Peter Hardstaff, head of campaign policy at UK-based World Development Movement, noted that the supposedly left-wing Labour government was actually actively pushing for deregulation.

He said the Department for International Development (DFID) which replaced the Overseas Development Administration in 1997, has been pushing hard for aid in privatisation policies.

"In water privatisation, DFID is the key player and in essence, the UK is exporting privatisation to developing countries," he told the workshop participants.

"Tying developmental aid is in line with the policies of the World Bank and the Asian Development Bank where 15 percent of such aid is channeled directly into national budgets."

Hardstaff said DFID is pushing for aid-funded businesses for UK companies abroad, similar to the Japan Bank for International Cooperation, a state-owned entity with heavy investments in the Asian region.

"This year, a water action plan released by DFID talked about a fund that was only available to the private sector, as per its policy," he said, citing Indonesia, Bolivia, Columbia and Argentina as having the largest water privatisation programmes in the world.

"The UK government's aim is to increase private sector presence in developing countries. This results in large borrowing from international financial institutions, increases debts and places a heavy burden on consumers."

The introduction of water privatisation in the UK, he said, was initially controversial but the government told the people that it could not afford to provide free water.

"People only accepted it because there are very strict regulations over the cost, management and distribution of water which has led private companies to face problems of meeting those standards."
 
Constitutional right

Workshop moderator Charles Santiago, and director of Kuala Lumpur-based Monitoring Sustainability of Globalisation Malaysia, said rights to water was entrenched in the constitutions of many countries.

"But in South Korea, the government was forced to withdraw the constitutional guarantee of water due to loan conditions set by the International Monetary Fund.

"In India, rivers are being privatised and in about 10 other countries, pre-paid cards are now required to access water such as in South Africa, despite being a constitutional guarantee."

In Malaysia, the federal government is considering the best model for water privatisation that can be adopted by other states in the country.

The government, which is in the process of taking over water management, treatment, distribution as well as sewerage treatment from state authorities, will resume privatisation plans after setting up a National Water Service Commission by the year-end.

But the situation in Thailand was different. The government first announced plans to privatise the country's power company last February followed by the privatisation of water in March/April.

"Hundreds of thousands of people from all walks of life, including journalists, took to the streets to protest the move," said Itthipol Sripranarm from the Bangkok-based Labour Union of Metropolitan Waterworks Authority.

"It was not just a workers' issue but also a citizens issue. We produced 200,000 video compact discs because the capitalist-controlled media did not cover our street demonstrations which was very intense but cause any disruptions to the water services."
He said the challenge was to mobilise mass support to oppose privatisation of power and water resources, adding that the government had rejected a call for a referendum over the issue.

"We must educate others and teach them to speak up for their rights, that water is a basic human right. When more people speak out, there will be more public support.

"In Norway, water is free of charge because they realised that it is a priceless commodity and they know about environmental protection and conservation."
 
Trojan horse

Uwe Hoering, of Berlin-based World Economy, Ecology and Development, said international financial institutions such as the World Bank are now pushing even harder for privatisation of water.

"They want a bigger slice of the water privatisation cake and they are denying that public-private partnerships amount to privatisation," he told participants. "Such partnerships are the Trojan horse of privatisation."

Vietnam, which is expected to face the privatisation of water after its transition from a central to a market economy, was more concerned over how to convince its people that privatisation is bad.

Tran Hoei, chief of the ruling party's Hue Community Education, said the Vietnamese people think that privatisation is good due to existing problems in the management and cost of water resources.

"How to convince them that privatisation is bad and that water should remain with the state? "

Walden Bello, director of Focus on the Global South, said one way to meet the challenges of privatisation is to expose the corporate interest that is pushing for it.

Another, he said, is to counter or show the myth of arguments on inefficiency or bad management of water resources by the government with real examples of success stories.
He said governments should also start thinking about subsidising public services and utilities, including water, in order to make it more affordable for the poor.

---

CLAUDIA THEOPHILUS, a malaysiakini journalist , attended the Asem Alternative Summit. Her trip was sponsored by the Transnational Institute, a Netherlands-based organisation for scholar-activists, and the Institute for Popular Democracy, a political research and advocacy institute in the Philippines.