Several years ago, Ismail Serageldin, vice-president of the World Bank, said that the wars of the 21st century will be about water. He was referring to the fact that the world is running out of fresh water sources at an alarming rate and that conflict over what remains will be invevitable.
To respond to the crisis, the World Bank has recently adopted a policy of water privatization and full-cost water pricing. This policy is causing great distress in many Third World countries, which fear that their citizens will not be able to afford for-profit water. Ironically, this policy has also created the first of the "water wars" Mr. Serageldin predicted, the bloody civil unrest that plagued Bolivia in recent weeks.
Two years ago, the World Bank (whose official attends Bolivian government cabinet meetings as a full participant) refused to guarantee a $25-million (U.S.) loan to refinance water services in Cochabamba, Bolivia's third-largest city, unless the government sold the public water system to the private sector and passed the costs on to consumers. Only one bid was considered, and the utility was turned over to a subsidiary of a conglomerate led by Bechtel, the giant engineering company implicated in the infamous Three Gorges Dam in China, which has caused the forced relocation of 1.3 million people.
In January, 1999, before the company had even hung up its shingle, it announced the doubling of water prices. For most Bolivians, this meant that water would now cost more than food; for those on minimum wage or unemployed, water bills suddenly accounted for close to half their monthly budgets. To add insult, the World Bank granted absolute monopolies to private water concessionaires, announced its support for full-cost water pricing, pegged the cost of water to the American dollar and declared that none of its loan could be used to subsidize the poor for water services. All water, even from community wells, required permits to access, and peasants and small farmers even had to buy permits to gather rainwater on their property.
The selling off of public enterprises such as transportation, electrical utilities and education to foreign corporations has caused a heated economic debate in Bolivia. But suddenly, debate turned to protest, and thousands took to the streets. A general strike and transportation stoppage brought the city to a standstill. Polls showed that 90 per cent of the public wanted Bechtel turfed out. Police reacted to peaceful demonstrations with violence and arrests.
In early April, President Hugo Banzer, a Pinochet-type dictator during much of the 1970s, declared martial law. Activists were arrested in the night; radio and television programs were shut down in mid-program. A 17-year-old-boy was killed by police with a gunshot to the face during a demonstration.
This is a story unfolding in many parts of the world. Just as the human race is beginning to come to terms with the awesome dimensions of the looming freshwater crisis, a handful of transnational corporations, backed by the World Bank, are moving in on Third World countries and, in the name of human charity, commodifying their water for profit.
The partnership between the World Bank and transnational corporations is not at all subtle. In March, almost 5,000 people gathered in The Hague for the second World Water Forum. Officially sponsored by the United Nations and the World Bank, the forum was openly dominated by a handful of huge water and food corporations.
The Forum was dedicated from the beginning to using the growing world water crisis to promote acceptance of the corporate control of water. A key dispute was whether water should be considered a "human right" or a "human need." This was not a semantic exercise. If water is a human need, it can be supplied by corporations. It is hard to make a profit on a human right. Distressingly, the governments attending, including Canada, sided with the World Bank and declared water a human need. Distressingly as well, the Canadian International Development Agency (CIDA) gave close to $600,000 and full support.
The privatization of municipal water services has a terrible record that is well documented. Customer rates are doubled or tripled; corporate profits rise as much as 700 per cent; corruption and bribery are rampant; water quality standards drop, sometimes dramatically; overuse is promoted to make money; customers who can't pay are cut off. In France, both water giants Vivendi and Suez-Lyonnaise des Eaux have been repeatedly cited for corruption. When water was privatized in Great Britain, water meters were installed in homes and company employees shut off service to many thousands of customers who could not pay their full water bills. When privatization hits the Third World, those who can't pay will die.
The Bolivia story has a happy ending (for now). By the hundreds of thousands, Bolivians marched to Cochabamba in a showdown with the government. On April 10, they won. The Bolivian government kicked Bechtel out of the country and revoked its water-privatization legislation.
Oscar Olivera, the humble Bolivian shoe maker who led the fight, brought his message to a Washington rally during the recent IMF/World Bank meetings. He said that if water is privatized and commodified for profit, it will never reach the people who need it but serve only to make a handful of water corporations very rich.
There is no way to overstate the crisis of fresh water facing the world today. No piecemeal solution will prevent the collapse of whole societies and ecosystems. A radical rethinking of our values, priorities and political systems is urgent and still possible. Water belongs to the Earth and all species; no one must be allowed to expropriate it for profit. Where will Canada stand?
Maude Barlow is the national chairwoman of The Council of Canadians and the author of Blue Gold, The Global Water Crisis and the Commodification of the World's Water Supply.
Copyright © 2000 Globe Interactive