AUTHORS:Brid BrennanBernhard HackOlivier HoedemanSatoko Kishimoto Philipp Terhorst

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Amsterdam,October 2004

INTRODUCTION 1

PRIVATISATION – HAS THE TIDE TURNED? 2

RECLAIMING PUBLIC WATER 5g ‘SOCIAL CONTROL’ IN BRAZIL 5g COCHABAMBA: PUBLIC-POPULAR PARTNERSHIP 8g GHANA: PUBLIC-COMMUNITY PARTNERSHIPS 10g DHAKA: PUBLIC-WORKERS PARTNERSHIP 12g CO-OPERATIVE WATER MANAGEMENT IN BOLIVIA 12g WATER SOLIDARITYVIA PUBLIC-PUBLIC PARTNERSHIPS 13

UP-SCALING WATER DEMOCRACY? 15

NOTES 18

BOOKS ON ALTERNATIVE TO WATER PRIVATISATION 20

GET INVOLVED IN WATERJUSTICE.ORG 20

FURTHER RESOURCES 21BOXES:

Messing up Manila 3Southern water TNCs? 3Where there’s a will… 6Community-managed,NGO-supported water projects 11P u blic Utility Pa rt n e rships in Malay s i a 14Financing Public Water for All 16

Indonesian State Minister of Env i r o n m e n t ,Nabiel Makarim recently stated that “there isnot a single state-owned water company inthe whole world that has proved itself an effi-cient manager of water resources.”1

Whether poor ly informed or just overly zea-lous in defending ideology-driven governmentplans for water privatisation,Mr. Nakarim’s sta-tement is seriously at odds with reality. Thereare innumerable examples of well-functioningpublic water utilities, also in developing coun-tries.2 Globally, over 95% of those with accessto water are supplied by public utilities.

It is, however, also a desperate reality thathundreds of millions in the South do not haveaccess to clean water and sanitation,a numberthat has increased in the last decade. In manycities in the South, public utilities fail to deliverclean water for all. It is a fact that public watersupply has been undermined by decades ofinsufficient investment, in many cases as aresult of crippling foreign debt and disastrousstructural adjustment programmes imposedby the IMF and the World Bank. Beyond theimpacts of global injustice , the failure of publicwater supply is often equally rooted in localinjustice. State-run utilities in many cities deli-ver cheap water to rich neighbourhoods,home to powerful local elites, while failing toprovide water to the poorest, especially thoseliving in remote and informal urban areas. Inany case, years of low-standard water quality,interrupted delivery and other problems hasleft many people disillusioned.This is one rea-son why there is often a fertile ground forproposed water privatisation in cities in theSouth.

Luckily, there are more viable and attractivealternatives to inadequate state-run utilities

than handing over the keys to profit-seekingprivate water corporations. Dramatic impro-vements in public water delivery have beenachieved, often within a few years, throughvarious forms of public utility reform. ThisBriefing will mainly focus on cities around theworld where major progress has been madeby introducing diverse models of public parti-cipation and democratic control. In thesecities, large and small, democratic reform hasproved to be a potent tool for making waterutilities more responsive to the needs of thepopulation, in particular the poorest. To whatextent are such reforms replicable in othercities and countries? What are the main hurd-les to scaling up these successful models?These are key questions which this briefingseeks to address.

3

rivatisation – has the tide turned?

Throughout the 1990s, privatisation of waterdelivery, often in the guise of Public-PrivatePartnerships (PPPs), was forced on manydeveloping countries through IMF and WorldBank structural adjustment programmes andas conditionalities for loans. T h e s eInternational Financial Institutions (IFIs), oftenwith the backing of local elites, promoted pri-vatisation of public water utilities as the onlypossible answer to the lack of governmentfinance or to deteriorating bureaucratic publicutilities.As a result,private water corporations,most of them with headquarters in the EU,took over water supplies in a large number ofmajor cities in the South.

In many of these cities, it soon became clearthat privatisation would not deliver the promi-sed efficiency and improvements in access toclean drinking water for the poorest.Escalatingprices and non-fulfilment of promised invest-ments were common features of privatisationfailures in cities like Cochabamba, M a n i l a ,Jakarta etc.3 Despite these realities, analystsjust a few years ago expected the privatisationbonanza to continue , creating a global privatewater market worth hundreds of billions ofdollars. 1997 was probably the peak year withbillions invested in buying up privatised utili-ties.4

Much to the surprise – and horror – of neo-liberal forces North and South, the expansiontrend began to collapse at the start of the newmillennium.The ‘big three’ water corporations(Suez,Veolia,and RWE/Thames Water – toge-ther controlling up to 85% of the global priva-te water market) got cold feet as they realizedthat they were unable to fulfil promisedimprovements of water delivery in cities withmany poor people and at the same time satis-

fy shareholder profit expectations.The rise ofg rassroots anti-privatisation campaigns incountries around the world,increasingly linkedinto regional and global networks, completedthe dramatic turn of events.5 In 2002, Suezannounced that it would pull out of citieswhere profits were disappointing and general-ly cut its operations in developing countries byone-third.6 New concessions would only beconsidered in cities where a profit was feasiblewithin a few years.The other water giants fol-lowed soon after and the list of cancelled con-cessions has been growing ever since. High-profile examples are Manila,Ho Chi Minh City( V i e t n a m ) , J a k a rt a , Maputo (Mozambique),Buenos A i r e s , and Shanghai. In cities likeCochabamba, Atlanta and Grenoble, conces-sions were cancelled following citizen protestsand city council inter vention.

The water TNCs are now licking their woundsand expansion plans focus on the potentiallymost profitable markets in Europe, the US,Canada and Japan, which threatens the futureof public water supply in these regions.

The failure to deliver affo r d a ble water to thepoor and the large-scale withdrawal from con-cessions by private water corp o rations haveo n ly made the Wo rld Bank adapt its rhetori c.While the Bank claims to be “open to any t h i n gthat wo rk s ” , it has in fact failed to seri o u s lyreconsider the virtues of pri v a t i s a t i o n . A studyby Public Citizen of loans provided in the peri-od A p ril-June 2004 reveals that “the Wo rl dBank continues to promote privatisation andcost recove ry policies, as well as supports legals t ructures that undermine local democra c ydespite evidence that such policies reducea c c e s s , raise the price of water for the poor,exacerbate inequities, and reduce local con-t r o l ” .1 1 C o n t i nued Wo rld Bank pressure is

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5

Messing up Manila

The situation in Manila, The Philippines, is illustrative of the failure of Suez and other watermultinationals to live up to their promises. Suez-subsidiary Maynilad has been responsiblefor water delivery in the western half of Manila, since 1997, but never delivered on itscontractual obligations to invest in improving access and reduced leakages. Instead the com-pany has insisted on continuous price hikes, resulting in a 500% price increase in the firstsix years. When the government hesitated to approve yet another price hike in 2002, Suezterminated the contract and went to an international arbitration court to demand compensa-tion for investments and expected profits. The company’s failure to upgrade services for thepoorest was a major reason for a cholera outbreak which killed several people in 2003.Despite this grim record, the government intends to reward Suez with a bailout, essentiallya golden handshake paid by the Pilipino tax payers. The civil society coalition Bantay Tubig,in contrast, demands that such funds are used for establishing a viable public utility, that candeliver affordable water effectively to all that need it.7

Not surprisingly, Suez has become the prime target of anti-privatisation campaigns aroundthe world. Global campaigns against Suez were launched earlier this year by Jubilee Southand other international activist coalitions.8

Southern water TNCs?

A new trend in a number of developing countries is the emergence of national private watercorporations, which are taking over public utilities at a steady pace. In Malaysia, for instan-ce, the government seems determined to move ahead with privatisation, granting conces-sions not to the EU-based water giants, but to Malaysia-based operators. Some of these pri-vate companies are becoming transnational corporations (TNCs) themselves. With the acti-ve support of the Malaysian government, they are taking over water delivery not only inSouth-East Asia, China and Africa, but even in the UK. Malaysia’s water barons include theRanhill Group, Puncak Niaga, Zencon and NS Water, all of which are privately owned bywealthy Malaysian businessmen.9 After a US$ 600 million water supply contract inZimbabwe being awarded to a Malaysian firm, Minister Jamaludin Mohd Jarjis celebratedthe deal which “enables Malaysia to take part in new and emerging businesses on the Africancontinent”.10 “Malaysian corporate giants which achieved success domestically”, Jamaludinadded, “must up the challenge of becoming global players”.

among the reasons why the gove rnments ofU ru g u ay and Thailand are preparing for pri v a t i-s a t i o n , despite the fact that both countries havee f fi c i e n t ly functioning public water utilities.Inspired by the March 2003 report “ F i n a n c i n gWater for A l l ” , w ritten by a panel chaired byfo rmer IMF director Michel Camdessus, t h eWo rld Bank is developing a whole range ofsubsidies and guarantee mechanisms in orderto make the water TNCs re-commit to expan-sion in the South.1 2 Whereas the Wo rld Banki nv a ri a bly condemns gove rnment subsidies fo rfi s c a l ly irr e s p o n s i ble public utilities, spending thesame funds on corp o rate welfare is praised as‘ i n n ov a t i ve ’ .The Wo rld Bank is not alone in thiss t u bb o rn ideology-dri ven response to theapparent collapse of the global pri v a t i s a t i o nt r e n d . The US gove rnment (USAID) is also amajor supporter of helping the water T N C sback into expansion, as is the European Union( E U ) . For an excellent analysis of the seri o u srisks related to these ‘ i n n ov a t i ve fi n a n c em e c h a n i s m s ’ , see the report “ W h o ’s Ta k i n gR i s k s ? ” , w ritten by Tim Kessler of the Citize n ’sN e t wo rk on Essential Serv i c e s .1 3

The EU has recently (2004) designated 1 bil-lion euros for the ACP-EU Water Facility – anew budget item for improving access tod rinking water and sanitation in the AC Pc o u n t ries (fo rmer European colonies inA f ri c a , the Cari bbean and the Pa c i fi c ) .D e s p i t estrong civil society cri t i q u e, the EuropeanC o m m i s s i o n ’s modalities for spending theWater Facility budget echoes to a large extentthe proposals in the ‘Camdessus Report’ touse public funding and development aid tosubsidise private sector investments inwater.14 This is consistent with European poli-cies throughout the 1990’s, when the accele-rated global expansion of the EU-based waterTNCs was given significant impetus by thepolicy and financial support of Europeang ove rn m e n t s , the European Commission andother international institut i o n s .

The EU’s development aid spending on waterin developing countries goes to a large extentto ‘ a d m i n i s t ra t i ve restru c t u ri n g ’ and othercosts related to the introduction of privatisa-tion programmes.15 Similarly, this pro-privati-sation bias is also shown in the EU WaterI n i t i a t i ve, presented during the 2002 UNSummit on Sustainable Development (WSSD)in Johannesbu rg . This EU Water Initiative,which has a budget of 2.4 billion euros com-mitted by EU member states, aims to boostprivate sector involvement through subsidisedPublic-Private Partnerships (PPPs).16

The French and British governments played –and continue to play – a particularly activerole in supporting French and British TNCs toopen up new markets. Despite promises toend ‘tied aid’, a substantial share of the UKgovernment’s development aid spending onwater goes to UK companies likeP ri c e Wa t e r h o u s e C o o p e rs , KPMG and theAdam Smith Institute.These consultants advi-se national or regional governments in India,Ghana,Tanzania and elsewhere on how to pri-vatise water services.17

Moreover, the EU is also working to ensureexpansion for the European water giantsthrough international trade negotiations suchas the WTO’s services talks (GATS).The EU’slist of market access demands for the GATSnegotiations was designed in close consulta-tion with water giants Suez,Veolia and ThamesWater.The leaked list of requests revealed thatthe EU has asked 72 WTO member states(including 14 Least-Developed Countries) toopen up water delivery and waste watermanagement to European water corpora-tions.18The EU’s aggressive role is replicated inits inter-regional and bilateral trade negotia-tions with countries of the South. In the con-text of the ongoing EU negotiations withMercosur, for instance, the EU is continuouslyincreasing the pressure on Latin American

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 20046

governments to liberalise their services, inclu-ding public services, in return for improvedaccess to EU markets for agricultural pro-ducts.19 The influential Asia Europe BusinessForum (AEBF) uses the Asia-Europe Meeting(ASEM) process to “speed up wide acceptan-ce of PPP in public utility development”, byconvincing government officials of the con-cept.20

The many failed privatisation experi m e n t shave shown that profit-driven transnationalwater operators are ill-equipped for – if notincapable of - securing water for the poorest.Support for public utility reform and expan-sion of not-for-profit water supply is a farmore obvious way forward. The EuropeanParliament has already expressed its supportfor such a change in course. In a September2003 resolution on the EU’s approach towater in the South,a majority in the EuropeanParliament insisted “on the need for localpublic authorities to be given support in theirefforts towards establishing an innovative, par-ticipatory, democratic system of public watermanagement that is efficient, transparent andregulated and that respects the objectives ofsustainable development in order to meet thepopulation’s needs.”

This briefing will present a range of citiesaround the world where public water supplyhas been improved through increased popularcontrol, participation and other democraticreforms. What lessons can be learned fromthese success stories and to what extent arethey replicable elsewhere as alternatives to fai-ling state-run utilities and for-profit water cor-porations?

The most well-known example of participato-ry water management is probably theDepartamento Municipal do Agua e Esgoto(DMAE), the water company of Porto Alegre,capital of the Rio Grande do Sul province ofSouthern Brazil. Water management in PortoAlegre was transformed when the WorkersParty gained power in the city 15 years ago(Partido dos Trabalhadores, PT).24

DMAE features a far-reaching degree of publicparticipation and democratic control over its

7

“In Hyderabad, most of the water from the reservoirs is going to the prosperous peoplewho on a daily basis use 500 or 600 liters for a two or three person family, whereas inthe southern part of the city of Hyderabad people get only 10 to 15 liters, standing ina queue 5-10 hours daily.When the tanker comes to their locality a thousand peoplecome and fight for the water.There is a lot of water in Hyderabad, but the distributionsystem is not proper.We need to target the corruption in public projects.”21

V.S.B. Reddy from Research in Environment,Education and Development Society (REEDS),Hyderabad,India speaking at the World Social Forum,January 2004

operations and investments.A council of localcivil society representatives control the dailywork of the utility, a form of democraticchecks and balances. Even more importantly,DMAE’s operations and investment decisionsare subject to a participatory budgeting pro-cess. Like many other areas of public life inPorto Alegre, the population directly decidesthe budget priorities of their water company.Through a process of public meetings, everycitizen can have a say in which new invest-

ments should be made first.This participatorymodel is one of the reasons that poor com-munities in Porto Alegre have gained dramati-cally improved access to clean water: theirneeds are prioritised because they participatedirectly in deciding new projects. Some 99.5%of the residents of Porto Alegre today haveaccess to clean water, far more than anywhe-re else in Brazil.

There are many other advantages to this par-

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Utility reform: where there’s a will…

In some situations, drastic improvements in public water delivery seem to be ‘simply’a mat-ter of political will and vision. In the 1990’s, progressive mayors in Bogotá, the capital ofColombia, refused to privatise water, despite continued pressure from the World Bank.Instead, they successfully reformed the Water and Sewerage Company of Bogotá (EAAB),transforming it into one of the most efficient and equitable utilities in Colombia, if not LatinAmerica. 22 Expanding water delivery to the poorer neighbourhoods received the highestpriority. By 2001, 95% of the population had clean tap water, while 87% were connected tothe sewage system, an impressive achievement considering the rapidly growing populationof the city. The expansion was financed by introducing a progressive tariff system, so thecity’s wealthy pay up to 200% of the real cost of their water. The poorest pay affordable, sub-sidised rates. At the same time, educational campaigns have reduced water consumption perperson by around 30% in ten years.

Highly motivated utility managers can also make a major difference. In Pnom Penh, capitalof Cambodia with over a million inhabitants, the number of households receiving runningwater has increased from 25% to almost 80% in the last ten years.23 The water flows 24hours per day instead of the ten hours that was common before. The inhabitants of the city’slarge slums are no longer dependent on unreliable private vendors and the health situationhas improved. Many observers point to the inspiring role played by Ek Sonn Chan, who in1993 became director of Phnom Penh Water Supply Authority (PPWSA), the city’s publicwater utility. Chan emphasises that PPWSA’s autonomy from the city government’s bureau-cracy has contributed to the efficiency and achievements of the utility. “Our salaries are notvery high but there is a high level of motivation,” Chan explained in a newspaper interview.Chan’s goal is that 95% of all households receive clean tap water before 2015. The PnomPenh case is being promoted by the Asian Development Bank as proof of the merits of fullcost-recovery. It is unclear whether PPWSA uses progressive tariff structures to ensure thatwater is affordable for the poorest in the city.

ticipatory system, such as awareness-raisingthrough being involved in decision-making,anda collective sense of ownership which allowsthe possibility for occasional price increaseswhich may be necessa-ry for financing newp r o j e c t s . The tari f fsystem is highly pro-g r e s s i ve : l ow - i n c o m egroups pay a low, cross-subsidised price, wateruse above a basic levelis relatively expensive.DMAE’s water price isone of the lowest in Brazil, but at the sametime environmental info rmation campaignsand the progressive price structure have madeoverall consumption go down. DMAE is publi-cly owned, but financially independent of thestate, being fully self-financed through thewater bills paid by the 1.4 million inhabitants.Itis a not-for-profit company that re-invests anysurplus into improving the water supply.

A comparable participatory model functionedin the rest of Rio Grande do Sul between1998 and 2002. Local participatory budgetassemblies and ‘committees of user citizens’played a d e c i s i ve role in the decision-making ofthe state utility Companhia Riograndese doSaneamento (CORSAN), which suppliesaround 6.5 million people in Rio Grande doSul (but not the state capital Port Alegre).25

This contributed to CORSAN becoming oneof the most effective water companies inBrazil, with an excellent record in expandingaccess to water.The participatory experimentwas scaled down,however, after the state elec-tion of October 2002, when the Workers’Pa rty (PT) was defeated by the centri s tPMDB.These events highlight the importanceof a supportive local government, both inestablishing and in ensuring the continuity ofthis type of participatory water management.The successes booked in Po rto Alegre and

Rio Grande do Sul have inspired many othercities in Brazil to introduce fo rms of part i c i-p a t o ry budgeting and other radical democra-tic refo rm s . Examples of Po rto A l e g r e - s t y l e

p a rt i c i p a t o ry watermanagement can befound in cities likeCaxias do Sul in thestate of Rio Grande doS u l , R e c i fe in the nort he a s t e rn state ofPe rn a m bu c o, and SantoA n d r é , Jacareí a n dP i ra c i c a b a , all in the

state of São Paulo.26 In Recife, a fast-growingcity with over 1.5 million inhabitants,the failingstate-owned water company was very unpo-pular. Following an extensive process of popu-lar consultations, the Recife Municipal Councilof Water and Sanitation was set up to impro-ve water delivery.27 The results of the restruc-tured company have improved dramaticallyover the course of only a few years,due to theactive involvement of community representa-tives and NGOs.The extensive public consul-tations and the resulting plans for improvingthe quality of public services helped the utilitymanagers in the negotiations with the WorldBank in 2003 about a US$ 84 million loan.TheWorld Bank initially insisted on privatisation,but after intense negotiations accepted to giveup any such conditionalities for the loan.28

9

“Through social control, democracy andtransparency, people push us to bemore efficient”

Carlos Todeschini of the Porto Alegre Water andSanitation Department (DMAE)

“We cannot only defend the mainte-nance of the status quo, which is notvery good in developing countries. Wecan change reality, improving the quali-ty of public services through popularparticipation, through mechanisms ofsocial control”.

Antonio da Costa Miranda, municipal directorfor water and sanitation in Recife

In the city of Matão, state of São Pa u l o, p ri v a t i-sation was narr ow ly avoided after advice fromA S S E M A E , the fe d e ration of public water utili-t i e s .2 9 This city of 50,000 people in the interi o rof Brazil lacked funds for the major new inve s t-ments needed to supply water to the grow i n gpopulation of the city.ASSEMAE proposed hol-ding a public meeting on how to ove r c o m ethese challenges. 150 people attended anddecided not to privatise the water. The inde-pendent public utility that was created insteadh a s , within fi ve ye a rs achieved 100% cove ra g efor water and sanitation, without any extern a lfi n a n c e. One of the ways this was done was bychanging the tariff structure to reduce wasteand encouraging the fixing of leakages.This sol-ved the problem of water scarcity and madenew investments unnecessary.

The achievements inPo r to Alegre andelsewhere in Brazil havealso inspired communi-ties in other parts ofLatin America to intro-duce forms of demo-cratic control in orderto build more effectiveand equitable watermanagement systems. An example isC o c h a b a m b a , B o l i v i a , where an innov a t i vemodel of public-popular management is underdevelopment.

In the spring of 2000, the population ofCochabamba mobilised against the disastrousrecord of Bechtel, the US corporation con-trolling the Agues del Tunari conglomeratethat took over after privatisation in 1999.When Bechtel expropriated community watersystems and resources and raised water prices

dramatically, community groups, trade unionsand irrigation farmers organised themselves inLa Coordinadora del Agua. Despite heavygovernment repression, a public referendumand several major mobilisations were organi-sed, which eventually forced out Agues delTunari.The Coordinadora gained control overSEMAPA’s governing body and embarked onbuilding a fairer and more democratic systemof water supply.

For decades, unchecked public bodies andmanipulative party politics have preventedSEMAPA from developing into a progressive,effective utility serving the poor.The companyis now being restructured and developed intoa transparent public utility with a high degreeof participation and sense of ownership by

citizen-users. While thelocal government waslargely hostile and dis-ru p t i ve towards theC o o r d i n a d o ra , c o -o p e ration with thewo rke rs and tra d eunions proved to becrucial. The statutes ofthe municipal, corpora-tised public water com-

pany SEMAPA were rewritten through a par-ticipatory process, which established popularparticipation on the Board of Directors byelected citizen representatives. In May 2002,three out seven members of the board wereelected by the inhabitants of the southern,central and northern areas of the city.30 Forthe first time, SEMAPA’s trade union was givena permanent seat on the Board.

The model under development inCochabamba, which can be described as anemerging public-popular partnership/manage-ment, has been successful in (re)-claimingSEMAPA as a public, democratic entity with apro-poor mission.31 Major challenges remain,

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“We strongly believe that these examp-les from Brazil show that open discus-sion can solve apparently irresolvableproblems.”

Antonio da Costa Miranda, municipal directorfor water and sanitation in Recife, Brazil

however, in the pursuit of clean water for allthe inhabitants of Cochabamba. SEMAPA hasinherited decades of mismanagement:deterio-rated pipe systems, huge debt, insufficient tre-atment of sewerage, discontinuous water flow,and a large part of the urban poor beingunconnected. In the fast-growing neighbour-hoods in the southern part of the city, over130,000 inhabitants need to be connected toSEMAPA’s water and sewerage services. Mostwater supply in this poorest and most margi-nalised part of Cochabamba is organised bywater committees, in which neighbours worktogether to run wells and other facilities andsupply the communities. Now that SEMAPA isbeing transformed into a public-popular utility,with the clear objective of serving the urbanpoor and allowing citizens major influence,these water committees have created an asso-ciation in order to be collectively connectedto the services of SEMAPA.

The quality of the groundwater in the valley inwhich Cochabamba is situated is low. As thegroundwater is too saline to drink, most hou-seholds still depend on private vendors fortheir drinking water. The vendors sell overlye x p e n s i ve and often unclean water.Unconnected to SEMAPA’s sewerage system,the neighbourhoods currently depend on pitlatrines and septic tanks.The water commit-tees are therefore working with SEMAPA todevelop a model of shared management, buil-ding on the organisational capacity and exper-tise of the committees in their local area andSEMAPA’s ability to deliver bulk water ands e we rage serv i c e s . In the words of LuisSanchez and Raul Salvatierra, the Southernzone’s representatives on the Board,the watercommittees have entered “a dialogue andconsensus-building process with the authori-ties to define a model of co-management ofbasic services, where each assumes their ownroles and functions.”32 During its brief time incharge of water supply, Bechtel simply expro-

priated the wells and pipes that had been con-structed by the water committees.The com-pany only expanded the pipe system into theSouthern area in return for excessive tariffincreases.The constructive co-operation bet-ween the city’s utility and the informal watercommittees is therefore an impressive impro-vement.

Besides ensuring the expansion of water deli-very to unconnected neighbourhoods, thenew public-popular management also faceschallenges concerning the access to waterr e s o u r c e s . Reducing leakages will help toincrease the water supply available to theusers and reduce the need for constructingexpensive, environmentally destructive dams.But beyond technical improve m e n t s , n e wapproaches based on sustainability and justicewill need to be developed to reconcile thecompeting needs for water, particular ly thelooming conflict between the ever-growingurban demand and the needs of rural agricul-ture in the regions around the city.

The major debt inherited from the previousowners make the expansion of services to theurban poor and the reduction of leakage inthe existing pipe systems dependent on loansfrom international financial institutions, such asthe Inter- A m e rican Development Bank(IADB). Even though the IADB tends to bepro-privatisation and generally hostile to thekind of changes envisaged by LaCoordinadora, the Bank agreed to a loan forSEMAPA under public-popular management.This was a major achievement by the newboard and managers who plan to use the loanto make a great leap forward in terms of deli-vering clean water to the urban poor. Themost serious opposition to the transformationtowards public-popular management has notcome from the IADB, but from local andnational economic elites, who are throwingspanners in the wheels whenever possible.

11

Water delivery in Cochabamba is a high-pro-file political issue.The success of the water waragainst Bechtel and the public-popular mana-gement have massively boosted the Bolivia-wide social movements fighting the neoliberalpolicies of the national government in La Paz.

The current support of a large majority of thecitizens of Cochabamba for SEMAPA’s public-popular management model may dwindle ifpeople do not see improvements in access todrinking water and sewerage actually reachtheir homes. Building a progressive public utili-ty that is financially sustainable and effectivelyserves the urban poor is a greater, longer-termchallenge than kicking out Bechtel. This willrequire dedication of the new management,the social movement organisations, the localgovernment and citizens.

In Ghana, the National Coalition againstPrivatization of Water (NCAP) has effectivelyde-legitimised the government’s plans for sel-ling off the public water utilities.The govern-ment, however, stubbornly proceeds with pre-paring for privatisation, backed by a US$103loan approved by the World Bank in August2004. In a protest letter to World BankPresident James Wolfensohn and the CEOs ofpossible bidders Veolia,Suez,Biwater and Saur,NCAP insists that “a thorough examination ofp u blic sector options” should take place.“Reform and restructuring of the public sectorwater utility is a viable option, requiring invest-ments in capacity-building, infrastructure, grea-ter local management autonomy and localcommunity accountability,” writes NCAP andthe hundreds of NGOs from around theworld who co-signed the letter.33The vision ofthe Ghanese coalition for solving the country ’s

water crisis goes beyond both “governmentbureaucrat management” and “private mana-gement”.34“What we want to see work inpractice in Ghana is participatory democracyin the provision of water,” says NCAP-activistAdam Al-hassan.

NCAP’s thinking about how to deliver waterfor all in Ghana is inspired by the achieve-ments of local communities in Savelugu, atown in the north of Ghana with a populationof around 25,000 people.35 Ghana WaterCompany Ltd. (GWCL), the national waterutility supplies water in bulk to the communi-ty, which is in turn responsible for pricing,distribution,and pipe maintenance.The towns-hip is divided into six areas, each with a watermanagement committee, c o m p rising equalnumbers of men and women.The committeescollect the tariffs and report faults and mal-functions of the water system to the districtassembly. The partnership was supported byNGOs like World Vision International, Global2000,the Carter Center as well as UNICEF, allof which hoped that community-managementwould bring clean water and reduce the highnu m b e rs of guinea wo rm infection inSavelugu.36 Between 1998 and 2002, the per-centage of households with access to safewater increased from 9% to 74%. Guineaworm disease in the community has beenreduced by over 98% since the project star-ted.

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200412

If you have the consumers participatingin the management of the water thereis likely to be transparency and demo-cracy in the system.We will not see thebureaucracy that existed before.”

Al-hassan Adam,National Coalition againstPrivatization of Water, Ghana.

The Savelugu model – which can be describedas a Public-Community Partnership (PCP) - isfacing a number of challenges which also indi-cate the hurdles that will need to be addres-sed in order to replicate the model elsewherein the country. One problem is that GWCL,on which the community depends for its bulkwater, has trouble delivering sufficient amountsof water. Similar to the situation inC o c h a b a m b a , water resource probl e m s

beyond the control of the local communityposes a serious challenge for the Savelugumodel. Furthermore, GWCL has introducedrather steep tariff increases in recent yearsdue to the national government`s full costr e c ove ry policies, promoted by IMF andWorld Bank.The result is that more and moreSavelugu households cannot afford the cost ofwater. The insufficient water delivery and thetariff increases highlight the need for improved

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Community-mana ged, NGO-supported water projects

An impressive example of improvements achieved through community-managed water deli-very can be found in Port-au-Prince, Haiti, where the French NGO GRET initiated a part-nership involving the public utility (CAMEP), local water committees in 37 shantytowns, andthe communities themselves.37 The project, supported by European development aid, provi-des water through stand pipes, constructed by the public utility CAMEP and the local com-m u n i t y. The management is done by community water committees, which hire a standpipemanager to run the system. The water committees buy the water in bulk from CAMEP a n dcollect the payment from the users. Around 600,000 people in 37 communities have benefi-ted from the project, which provides far cheaper and safer water than the private water ven-dors who otherwise are the only option in the shantytowns of Port-au-Prince. Another successful example is the Orangi Pilot Project (OPP) in Karachi (Pakistan), suppor-ted by the UK NGO Wa t e r A i d .38 This project in the Orangi township, an area without propersanitation, enabled low-income households to finance, construct and maintain sanitationsystems themselves. The initiative came from a Pakistani NGO which promotes communityo rganisation and self-management to solve poverty-related problems. The NGO first devel-oped a simplified sanitation solution that is affordable and technically feasible to be imple-mented and maintained by the low-income local population. They also contributed withknow-how and other advice, training for local, small-scale building contractors, and most ofall, empowering the population to take responsibility for providing sanitation. Groups of 20-40 households co-operate to implement and maintain a common sewerage system. As every-one has invested in establishing the system, there is a strong incentive to undertake the neces-sary maintenance. The use of low-cost technologies and local skills instead of expensivecontractors means external credit is not necessary. The Orangi model has already been trans-ferred to 42 settlements in Karachi and work is being done to replicate the programme in otherPakistani cities. The biggest problem has probably been the failure of the Karachi municipalgovernment to construct the necessary main drains and treatment plants, despite continuedpressure from OPP. The municipal government does not live up to its responsibilities, so thesewage runs into the river during heavy rain.

government water policies if local progressivemodels are to survive, not to mention thechances for replicating such models across thecountry.

There are numerous examples from aroundthe world of highly successful community-managed water delive ry made possibl ethrough financial and other support of inter-national NGOs (see box). Without castingdoubt on the effectiveness of the projects andthe improvements achieved, there are a num-ber of reasons for caution before thesemodels are promoted as the way forward.Theprojects are generally established in communi-ties where the government has fundamentallyfailed to secure water and sanitation for thepoorest.In terms of fairness,it is far from idealthat the poor have to do their own construc-tion work while richer neighbourhoods donot. It must be emphasised that redistributionof wealth and resources is a key governmentfunction and that democratic decision-makingabout public investments is crucial to achievingessential services for all. Finally, internationalNGOs are not always accountable to localcommunities.

A unique model has proven successful in theBangladeshi capital Dhaka, where the watersupply in parts of the city is co-managed by aworkers’ co-operative. In 1997, the proposedprivatisation of the water supply in a part ofDhaka (imposed by the World Bank) was metwith strong trade union opposition.39 In res-ponse, the Dhaka Water Supply and SewerageAuthority (DWASA) decided to contract outone zone to the DWASA Employees’ Union,while another zone was given to a local priva-te company (EPC Ltd.), also on a trial basis.After this fi rst ye a r ’s experi m e n t , t h e

Employees Co-operative’s results were somuch better that DWASA handed over theprivate sector’s contract to the union. TheEmployees Co-operative achieved substantialimprovements not only in customer services,billing and collection of fees, but also in redu-cing water losses.They out-performed the pri-vate company but DWASA too, a public utili -ty suffering from over-bureaucratisation andinertia.

According to Zahirul Hoque, the EmployeeCo-operative succeeded “by cashing in onexperience, participative decision-making andbuying integrity with higher salari e s ” .C o rru p t i o n , a widespread problem inBangladesh, was targeted by doubling the sala-ries of the employees,who “can now afford tobe more honest and more actively committedto achieving the organisational goals”.Anotherinnovation by the Employee Co-operative wasto work with NGOs to improve water deli-very to slum dwellers. As is the case in manycities in the South, the slums in Dhaka weretraditionally not supplied by the public waterutility as they lacked legal status.Slum dwellerswere left to buy water at exorbitant pricesfrom private vendors.The situation has impro-ved in those areas where DWASA and theEmployee Co-operative have now introducedstreet taps.

User co-operatives have proved an excellentway to deliver clean water in many smallercommunities around the world, both in ruralcommunities and in urban slum areas wherethe state fails to supply basic services.xl Theexperience in the Bolivian city of Santa Cruzproves that co-operative models can also bevery successful in major urban centers. SantaCruz has 1.2 million inhabitants. The city’swater utility has been run by a consumer co-

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200414

operative since 1979 and is regarded as one ofthe best-managed water utilities in LatinAmerica. All customers are members of theCooperativa de Servicios Publicos Santa CruzLtda (SAGUAPAC) and have the right to votein the co-opera t i ve ’s General DelegateAssembly.The assembly elects part of the uti-lity’s administrative board and the supervisoryboard. SAGUAPAC is financially independentand ensures that all costs are recovered fromthe water users, in other words full-cost reco-very. As part of its socially responsible appro-ach,the co-operative charges a lower price forthe first 15 cubic meters of water consumedper household each month and customers fai-ling to pay are not disconnected.

“The co-operative structure of SAGUAPAC isa major reason for its high performance”,con-cludes Andrew Nickson of the University ofBirmingham in a study. 41 In other large citiesin Bolivia, political intervention by municipalmayors (in their capacity as presidents of theboards of directors of the utilities) caused pro-blems ranging from corruption and cronyismto bureaucratic delays.The co-operative struc-ture, Nickson points out “shields managementfrom undue political interference, especiallywith regard to personnel matters,tariff setting,and the awarding of contracts”. In sharpcontrast to other water utilities in Bolivia,SAGUAPAC has “an unblemished record withregard to corruption.”

Inspired by the achievements in Santa Cruz,consumer-owned water co-operatives wereset up in several other Bolivian cities in the1 9 8 0 ’s and 1990’s , for instance, as Ta ri j a(145,300 inhabitants) and Trinidad (80,700inhabitants). In Argentina, co-operatives havetraditionally played a key role in water deliveryto small and medium-sized cities, covering upto 10% of the population.

Major improvements in water delive ry can bea c h i e ved through tra n s fer of managementand other skills between public opera t o rs .A nexample of a successful Publ i c - P u bl i cPa rt n e rship (PUP) can be found in SouthA f ri c a , where the local authorities inH a rrismith teamed up with Rand Wa t e r.H a rrismith has a ve ry high pove r ty rate andu n d e r- d e veloped water delive ry serv i c e s ,while Rand Water is among the largest andmost effe c t i ve public water utilities in thewo rl d . The 3-year management contract ra nb e t ween 2000 and 2003. D u ring the part-n e rs h i p, the water and sanitation sector wasri n g - fenced fi n a n c i a l ly and run as an autono-mous business unit under the name ofA m a n z i wethu our water Water Serv i c e s( AW S ) . Rand Water staff were responsible fo rm a n a g e m e n t , H a rrismith city council wo rke rsensured the day - t o - d ay opera t i o n s . L a b o u rand service users were closely invo l ved in ac o n s u l t a t i ve process.

Laïla Smith and Ebrahim Fakir of the Centrefor Policy Studies in Johannesbu rg emphasisethat “the challenge of service delive ry altern a-t i ves is to ensure that the local authority capa-city to gove rn is built up in the process ofp a rt n e ri n g ” .4 2 They conclude that theH a rrismith part n e rship has “made signifi c a n ta c h i e vements that will hopefully help to setprecedence in the development of futures e rvice delive ry altern a t i ve s ” . At the samet i m e, Smith and Fakir observe that “the hou-sehold quality of life has only marg i n a l lyi m p r ove d ” for low-income groups. H a rri s m i t hhas a 38% unemployment rate and manypeople are simply not able to pay for water.The 6,000 litres free water per household permonth - guaranteed by the South A f ri c a nconstitution - is insufficient for the often larg efamilies in Harri s m i t h . “Such minimal levels of

15

u n i ve rsal provision does not resolve the lega-cies left by apart h e i d ’s spatial dislocationwhere entire communities are depri ved ofeconomic opportunities necessary to affo r dthe cost of essential serv i c e s ” , Smith and Fakirc o n c l u d e. They recommend double the gua-ranteed amount of free water per householdto 12,000 litres.

Pa rt n e rships between public utilities holdgreat potential for experience-sharing in orderto make water management more effectiveand responsive to people’s needs.Sharing bestp ractice in management and technologythrough PUPs is obviously not only an optionwithin a country, such as the South Africanexample. No less relevant are cross-borderpartnerships between utilities in the Northand the South,as well as South-South.43Thesepartnerships can be anything from an expe-rienced water manager being seconded towork with a utility in need of support to farmore extensive suppor t progra m m e s .Development aid can play a very positive rolein lowe ring the hurdle for this fo rm ofdomestic and international water solidarity.The establishment of the Intern a t i o n a l

Association of Public Water Operators, plan-ned for the end of 2004, will be a very signifi-cant development which can give a real boostto the growth of Public-Public Partnerships.

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200416

Public Utility Partnerships in Malaysia

In response to the Malaysian government’s plans to privatise water, civil society groupspoint to the highly effective water utility Perbadanan Bekalan Air Pulau Pinang (PBA) as analternative model.44 Via Public Utility Partnerships (PUPs), public water providers in therest of Malaysia could improve their performance. Due to effective monitoring, PBAhas thelowest non-revenue water (water lost, wasted or not paid for) in the country, just 18 per-cent.45 This is one of the reasons that it can generate the highest surplus, although its watert a r i ffs are the lowest in the country. According to Charles Santiago (MonitoringSustainability of Globalisation) “the appropriate lesson for Malaysia would be to learn fromPBA in terms of operation, management, distribution, billing, reduction of non-revenuewater and still keep the management and control of water resources in the hands of the stateand public control.”

M a ny examples of major improvements inp u blic water delive ry in the South have beend e s c ribed in this paper. Increased citize n ’s ’p a rticipation and democratic control hasp r oved to be effe c t i ve in a range of dive rs ec i r c u m s t a n c e s . The emergence of new part i-c i p a t o ry politics has breathed new vitalityand effe c t i veness into publ i c ly - owned bu toften dysfunctional and bu r e a u c ratised wateru t i l i t i e s . In all their dive rs i t y, the success ofthese models is based on the active invo l ve-ment of the local population, whether in pri-o ritising investment decisions, d e m o c ra t i ccontrol enabling people to hold the waterutility accountable to their needs or throughc i t i ze n s ’ engagement in reducing water lossesand other technical challenges. As ‘ p a rt i c i p a-t i o n ’ is a mu c h - a bused concept,4 6 it shouldbe stressed that the success of the modelsd e s c ribed in this bri e fing is based on far- r e a-c h i n g , g e nuine democratisation of decision-m a k i n g . This clearly can boost the accounta-bility and responsiveness of the water utilityt owards the poorest and achieve remark a bl eresults in terms of effi c i e n c y, sustainability andsocial justice.

The question remains as to what the poten-tial is for replicating such success stori e se l s e w h e r e, whether within the same country,in other compara ble countries in a region, o rin ve ry different countries in other parts ofthe wo rl d . We would genera l ly argue thatboosting tra n s p a r e n c y, accountability and res-p o n s i veness through democratic controlcould probably improve the perfo rmance ofmost utilities, regardless of socio-economiccircumstances and political realities. Far moreresearch and discussion is clearly needed toassess the exact potential for replicating ke yfeatures of a successful model elsewhere.

For instance, is Porto Alegre’s participatorymanagement model fea s i ble in cities without aP T-style progressive party holding power? T h ee x p e rience in Cochabamba suggests that it is.A similar model of people-centred watermanagement based on democratic control isbeing developed despite the absence of sup-p o rt – if not outright obstruction - from them ayor and the city council.The refo rms are dri-ven by community activists who have built upa lot of countervailing power through theirs t ru g g l e s , p a rt i c u l a rly the water war againstBechtel in 2000.

Is participatory water management achievablein a mega-city like Manila,with 10 million inha-bitants, many of whom live in slums with noaccess to piped water? Can decentralisation –such as dividing the city into 5 or ten morezones - overcome this challenge?

Decision-making on urban water delive ry incities of the South is often an intense politicalbattleground where the vested interests ofpolitical and economic elites clash with thoseof the poorest.As many examples in this paperh ave show n , the most direct path to waterjustice is when marginalised people mobiliseand their power is boosted through democra-tic water management refo rm s .A c t i ve invo l ve-ment of the population is clearly a conditionfor part i c i p a t o ry water management to suc-

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“ C reating part i c i p a t o ry institutionsfor public service provision is inhe-rently political. The process will taketime and cause conflict, and it will notresult in perfectly re p re s e n t a t i v egov e r n a n c e ” . 4 7

Tim Kessler, Citizen’s Network on EssentialServices

c e e d . Successes are most like ly to occur incities where unequal access to clean water cre-ate an immediate need for redistri bu t i o n .

How relevant is participatory water manage-ment in Europe, where public utilities general-ly manage to supply clean and affordablewater to all? In Italy, citizens’ participation inwater management is already being introdu-ced in Grottamare and several other munici-palities.48 Also elsewhere in Europe, suchexperiments with ‘water democracy’may pro-vide opportunities for revitalising public utili-ties and boosting their performance againstthe background of looming privatisation pro-moted by national and local governments.G i ovanni Allegretti of the Unive rsity ofFlorence, in his overview of experiments withparticipatory budgeting in Europe, highlightsthe fact that citize n s / u s e rs are not only“potential modernisers of public services” butalso have unique knowledge that can elevatethe quality of decision-making.49

We will not attempt to fully answer these

questions in this briefing, but underline theneed for in-depth information sharing andcross-fertilisation of ideas and lessons, particu-larly between those directly involved in run-ning or developing participatory models.Thefo rthcoming book on part i c i p a t o ry urbanwater management could provide a majorleap forward. The waterjustice.org websiteprovides a virtual resource centre and mee-ting place for exchanging experiences, debateand strategies on these key issues.

For the international community, the priorityshould be to help overcome obstacles to theupscaling of successful people-centred models,for instance, financing challenges.After a deca-de of failed experiments with water privatisa-tion, the time has come to embrace the manyavailable options for improved public andcommunity-controlled water delivery.

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200418

Financing Public Water for All

Raising funds for expanding access to clean water is a tremendous hurdle for publicutilities across the South. Estimates for the total amount needed globally to secureclean water for the world’s urban populations vary from an additional US$9 billionper year (based on low-cost technology) to US$49 billion (including full sewerageand wastewater treatment).5 0 The US military budget for 2004, by the way, isUS$399 billion.

What needs to happen at the international level to facilitate increased financial flowstowards public water? A few straightforward options are:

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g Debt cancellation: the poor world every year transfers $382 billion to the banksand financial institutions of the rich countries in the form of debt repayments.51

Due to high interest rates, the total of debt of Southern nations has now reached acatastrophic US$2.5 trillion, many times more than the original amount borrowed.g Ending the continuous decline in Northern development aid flows and ensuringthat grants for water supply and sanitation are provided without privatisation con-ditionalities.g Sub-sovereign guarantee mechanisms for public water are needed to enablemunicipalities to lend on the international financial markets (currently very diffi-cult as municipalities in developing countries are not considered credit-worthy).

In addition to international money flows, there are a wide range of local financeoptions available, including:g More effective and progressive taxation by national and local governments(focusing on increased tax on corporations and wealthy individuals) to mobilisefunds for new investments in clean water.g In many of the successful participatory models described on the previous pages,money for investment can be raised through progressive user charges.52 Ability topay is a key concern, but well-designed tariff systems can secure equitable accessand affordability. The degree to which costs are recovered via user charges is a mat-ter of political choice. Full cost recovery may work well in some cities, but can havedisastrous social consequences in others, particularly in the absence of socially justtariff systems. g Cross-subsidisation ensures that the more affluent consumers subsidise the billsof the poorer ones. A variation is scaled or block tariffs where prices rise with theamount of water consumed. Charging higher fees for infrastructure development inricher neighbourhoods is another option. The public utility of Porto Alegre uses thehigher fees paid by wealthy citizens to build a surplus that goes into an investmentfund for financing new projects. This reduces dependency on external loans.g For cash-strapped communities, local borrowing is more realistic and less riskythan borrowing in foreign currency from international financial institutions. Cash-pooling across several communities is one way to make them bankable, lowering therisk for local lenders thus making the loans more affordable.53

g Raising finance by issuing municipal bonds is another possibility. Issuing bondson the international market requires a credit rating that only few cities have, althoughAhmedabad, India, managed to do just that in 1998.54 A preferable option may be tosell municipal bonds on local markets, as is done by South African Rand Water.Dependency on outside financers is thus minimised and local investors are less likelyto withdraw their capital in a crisis.55

1 Quoted in “ J a k a rta Water Pri va t i s a t i o n ” ,Nila A r d h i a n i e, Indonesian Forum on Globalisation, September 2004.2 In addition to the examples described in this report , many more cases have been documented by the Public Serv i c e s

I n t e rnational Research Unit (PSIRU). See for instance “ P u blic services work ! ” ,P u blic Services Intern a t i o n a l , September 2003,h t t p : / / w w w. p s i ru . o rg / r e p o rt s / 2 0 0 3 - 0 9 - U - P S W. p d f

3 For an ov e rv i ew of the social and health impacts of water pri vatisation Manila, J a k a rt a , Buenos Aires and many otherc i t i e s, see “The Water Barons”,The Center for Public Integ ri t y, F e b ru a ry 2003.

4 “European Water T N C s :Towards Global Domination?”, CEO Info Bri e f, March 2003,h t t p : / / w w w. c o r p o ra t e e u r o p e. o rg / wa t e r / i n fo b ri e f 1 . h t m

5 This was very visible at the March 2003 Wo rld Water Forum where activist accounts of disastrous pri vatisation ex p e ri e n-ces in the South torpedoed the PR stra t egy of the pro-industry Wo rld Water Council (WWC). See for instance “ Water pri-va t i ze rs on the defe n s i v e ” ,N ew Internationalist website,h t t p : / / w w w. n ew i n t . o rg / fe a t u r e s / k y o t o / 0 2 0 6 0 3 . h t m

6 “ Water multinationals in retreat”,P S I R U, J a n u a ry 2003.7 Bantay Tu b i g : w w w. i p d . p h / B a n t a y % 2 0 Tu b i g / w e b - c o n t e n t / b 2 b i g _ m a i n . h t m l8 Jubilee South:h t t p : / / w w w. j u b i l e e s o u t h . o rg /9 “ M a l a y s i a ’s Water Barons”, Global Water Intelligence, March 20041 0 “Malaysian firm wins Zimbabwe water project”, Water & Wa s t ewater Intern a t i o n a l ,August 2004.1 1 Wo rld Bank Wa t c h ,A p ril-June 2004, h t t p : / / w w w. c i t i ze n . o rg / c m e p / Wa t e r / n ew / w b wa t c h / a rt i c l e s. c f m ? I D = 1 1 8 0 21 2 Options considered by the Wo rld Bank include: out-put based cash subsidies, in-kind gra n t s, tax breaks, capital contri b u t i o n ,

g u a rantees of ri s k . See “ W h o ’s Taking Risks? How the Wo rld Bank pushes pri vate infra s t ructure - and finds resistance insome surprising places”.Tim Ke s s l e r, C i t i ze n ’s Network on Essential Services (July 2004).h t t p : / / w w w. wa t e r j u s t i c e. o rg / a n a l y-s i s. p h p ? c o m p o n e n t I D = 8 & a rt i c l e I D = 5 1

1 3 I b i d .1 4 See for instance:h t t p : / / w w w. b o t h e n d s. o rg / p r o j e c t / p r o j e c t _ i n fo. p h p ? i d = 1 3 & s c r = t p1 5 “ I nvesting in the bureaucracy of pri vatisation – a critique of the EU water initiative papers ” ,P S I R U, F e b ru a ry 2003.1 6 “ E v i a n :C o r p o rate We l fare or Water for A l l ? ” ,CEO Info Brief 6, May 2003,h t t p : / / w w w. c o r p o ra t e e u r o p e. o rg / wa t e r / i n fo-

b ri e f 6 . h t m1 7 “Profiting from Pov e rt y :P ri vatisation consultants, DFID and public serv i c e s ” ,War on Wa n t , September 2004,

h t t p : / / w w w. wa r o n wa n t . o rg / p r o f i t i n g1 8 “ W TO and Wa t e r:The EU’s Crusade for Corporate Expansion”, CEO Info Bri e f, March 2003:

h t t p : / / w w w. c o r p o ra t e e u r o p e. o rg / wa t e r / i n fo b ri e f 3 . h t mThe full list of leaked requests and offe rs is online at http://www. g a t s wa t c h . o rg / r e q u e s t s - o f fe rs. h t m l

1 9 “ E U, Mercosur Suspend Talks on Free Trade Accord Until A u g u s t ” ,B l o o m b e rg ,July 22 2004.The Mercosur EuropeanBusiness Forum (MEBF) has functioned as an engine of the neo-liberal economics driving the neg o t i a t i o n s.The MEBF con-sists of European TNCs and their counterparts in Latin A m e ri c a .

2 0 European water giants like Suez and East Asian construction and engineering companies work within the A E B F ’s very acti-ve working groups on Infra s t ructure and Environment to promote pri va t i s a t i o n .“Asia-Europe Business Forum - A S E M ’sC o r p o rate Bias”, CEO Issue Bri e f i n g , September 2002,h t t p : / / w w w. t n i . o rg / a s e m - c o p e n h a g e n / c e o b ri e f. h t m

2 1 “Financing Public Wa t e r ” ,Wo rkshop during Wo rld Social Foru m , 19/1 2004,h t t p : / / w w w. wa t e r j u s t i c e. o rg / a rt i c l e. p h p ? s u b S e c t i o n I D = 1 & a rt i c l e I D = 4 2

2 2 “ Keeping it public in Bogotà”,S a rah Garl a n d , N ACLA Report on the A m e ri c a s, July/August 2004.2 3 “ C a m b o d i a :Water agency’s efficiency lauded”, Asia Times Online,F e b ru a ry 21 2003.2 4 “ Water in Po rto A l eg r e, B razil - accountabl e, e f fe c t i v e, s u s t a i n a ble and democra t i c ” ,P u blic Services International Research

U n i t ,August 2002.h t t p : / / w w w. p s i ru . o rg / r e p o rt s / 2 0 0 2 - 0 8 - W- d m a e. p d f2 5 See also “ Wa t e r: p u blic management success in Rio Grande do Sul - Bra z i l ” , by Dieter Wa rt c h ow, Companhia Riogra n d e n s e

do Saneamento (CORSAN).2 6 See also: SAMAE - Caxias do Sul/RS:h t t p : / / w w w. s a m a e c a x i a s. c o m . b r /

SEMASA - Santo A n d r é / S P : h t t p : / / w w w. s e m a s a . c o m . b r /SAAE - Jacareí / SP:h t t p : / / w w w. j a c a r e i . s p. g ov. b r / s a a e. h t mSEMAE - Piracicaba / SP:h t t p : / / w w w. s e m a e p i ra c i c a b a . o rg. b r

2 7 “ People-centered Water Management is Po s s i bl e ! ” ,Seminar on A l t e rnatives to Water Pri v i t i s a t i o n ,J a n u a ry 17 2004,Wo rl dSocial Foru m ,M u m b a i . h t t p : / / w w w. wa t e r j u s t i c e. o rg / a n a l y s i s. p h p ? c o m p o n e n t I D = 5 & a rt i c l e I D = 1 1

2 8 “ R e c i fe Refuses Wo rld Bank Proposal - Gets Loan Without Pri va t i s a t i o n “ :h t t p : / / w w w. wa t e r j u s t i c e. o rg / u p l o a d s / a t t a c h-m e n t s / p d f 4 0 . p d f

2 9 Association of Municipal Water and Sanitation Public Utilities (ASSEMAE):h t t p : / / w w w. a s s e m a e. o rg. b r /3 0 “ I n t e rnational Solidarity Strengthens the Stru g g l e ” , by Sabrina Souza and Tom Kru s e.3 1 See also the MSc thesis by P.Te r h o rst (2003) “ P u bl i c - Popular Org a n i s a t i o n s,The case of Cochabamba,B o l i v i a ” ,online on

h t t p : / / w e d c. l b o r o. a c. u k / p r o j e c t s / n ew_projects3.php?id=26 (under ‘other outputs’).

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200420

3 2 “ A d vances in Cochabamba”, Luis Sanchez and Raul Salva t i e rra - July 2004,h t t p : / / w w w. wa t e r j u s t i c e. o rg / c a s e s t u d y. p h p ? c o m p o n e n t I D = 4 & a rt i c l e I D = 4 6

3 3 h t t p : / / w w w. c i t i ze n . o rg / c m e p / Wa t e r /c m e p _ Wa t e r / r e p o rt s / g h a n a / a rt i c l e s. c f m ? I D = 1 2 2 6 7

34 Al-hassan Adam speaking at the seminar on alternatives to water pri va t i s a t i o n ,J a n u a ry 19 2004,Wo rld Social Foru m ,M u m b a i .h t t p : / / w w w. wa t e r j u s t i c e. o rg / a n a l y s i s. p h p ? c o m p o n e n t I D = 5 & a rt i c l e I D = 1 1

3 5 “Community Public Sector Pa rt n e rship for the Provision of Water Services in Savelugu,G h a n a ” , Pa t rick A p o ya ,C o m m u n i t yPa rt n e rships for Health and Dev e l o p m e n t ,G h a n a , July 2003. h t t p : / / w w w. c o m m o n w e a l t h p e o p l e. c o m / i n fo / g h a n a . p d f

3 6 Water Pri vatisation in Ghana: Activists Battle With Gov e rnment and Wo rld Bank, Al-hassan A d a m ,National Coalitionagainst Pri vatisation of Water - NCAP (November 2003),h t t p : / / w w w. wa t e r j u s t i c e. o rg / c a s e s t u d y. p h p ? c o m p o n e n t I D = 1 & a rt i c l e I D = 1 4

3 7 GRET contributed in the initial phases with financial support ,t raining and other organisational support , but has reducedtheir involvement gradually as the project proofed to be self-sustained by the local part n e rs. See also the website ofGroupe de Recherche et d’Echange Technologique (GRET):h t t p : / / w w w. g r e t . o rg / m o n d e _ u k / r e s u l t . a s p ? p a y s = 9 0

3 8 See for instance “Community-Managed Sanitation Services for the Urban Poor in A s i a ,A f rica and Latin A m e ri c a :C o n s t ra i n t sto Scaling-up of ‘Islands of Success’” , by Ramesh Bhatia, Resources and Environment Group (New Delhi,I n d i a ) .h t t p : / / w w w. d e p. n o / f i l a rk i v / 2 0 2 5 8 5 / B h a t i a _ - _ s u c c e s s _ c a s e s 1 . p d f

3 9 “ E x p e rimental A l t e rnate Option to Pri vatisation of Water Industry in Dhaka,B a n g l a d e s h ” , by M.Z.Hoque, presentation fo rthe seminar on advancing alternatives to pri va t i s a t i o n ,K y o t o, 22 March 2003. h t t p : / / w w w. wa t e r j u s t i c e. o rg / u p l o a d s / a t t a c h-m e n t s / a t t a c h m e n t 4 8 . p d f

4 0 In areas without access to public serv i c e s, communities in many cases have developed their own projects to ensure accessto drinking wa t e r. “Going the cooperative wa y ” ,The Couri e r, F e b ru a ry 2001.

4 1 “ O rganisational Structure and Pe r fo rmance in Urban Water Supply:The Case of the SAG U A PAC Co-operative in SantaC ru z ,B o l i v i a ” ,A n d r ew Nickson,I n t e rnational Development Depart m e n t ,U n i v e rsity of Birm i n g h a m ,h t t p : / / w w w. i d d . b h a m . a c. u k / r e s e a r c h / P r o j e c t s / R o l e _ o f _ g ov / w o rk i n g p a p e rs / S a g u a p a c % 2 0 f i n a l . p d f

4 2 “The Struggle to Deliver Water Services to the Indigent: A Case Study on the Public Pa rt n e rship in Harrismith with RandWa t e r ” ,D r. Laïla Smith & Ebrahim Fa k i r, Centre for Policy Studies (Johannesburg ) , September 2003,h t t p : / / w w w. c p s. o rg. z a / c p s % 2 0 p d f / R R 1 0 3 . p d f

4 3 One such part n e rship was initiated in August 2002 between Rand Water and the Brazilian Association of Municipal Wa t e rand Sanitation Public Utilities (ASSEMAE),o t h e rs are under prepara t i o n .

4 4 “ P u bl i c - p u blic part n e rship for water management proposed”, Malaysiakini (online new s p a p e r ) ,July 31 2004,h t t p : / / w w w. m a l a y s i a k i n i . c o m / n ews/28836 See also:“ P ri vatisation vs.P u bl i c - P u blic Pa rt n e rship in Malaysia”, C h a rl e sS a n t i a g o, M o n i t o ring Sustainability of Globalization,2 0 0 4 .

4 5 N o n - r evenue water includes water lost due to leaks in the pipes or wasted elsewhere in the system, but also illegal con-n e c t i o n s. N RW levels of 40-60% are common in many large cities in the South, whether public or pri va t i s e d . In westernM a n i l a , N RW levels increased from 60 to 66% after pri va t i s a t i o n .

4 6 The Wo rld Bank, for instance, routinely abuses ‘ p a rt i c i p a t i o n ’as a means to effectively bypass local opposition to its pro-j e c t s. S e e :“The Wo rld Bank’s role and policy in water management”, in “ Water Pri vatisation – Trans-National Corpora t i o n sand the Re-regulation of the Water Industry ” , Matthias Finger and Jeremy A l l o u c h e, Spon Press, London 2002.

4 7 “ W h o ’s Taking Risks? How the Wo rld Bank pushes pri vate infra s t ructure - and finds resistance in some surprising places”.Tim Ke s s l e r, C i t i ze n ’s Network on Essential Serv i c e s, July 2004.

4 8 “Local Democra c y ” , H i l a ry Wa i n w ri g h t ,Red Pe p p e r, August 2004.4 9 “The Return of the Caravels – Pa rt i c i p a t o ry Budgets from South A m e rica to Europe”,G i ovanni A l l egretti and Cars t e n

H e r z b e rg ,TNI briefing 2004/5.5 0 “Financing water for all. Beyond border policy conv e rgence in water management.” IDS working paper 223,2 0 0 4 .5 1 “Balancing the Other Budget: Proposals for Solving the Greater Debt Crisis - How Globalisation Creates Debt and Why the Rich

Are in Debt to the Po o r ” ,A n d r ew Simms and Romilly Greenhill, Jubilee Research at the New Economics Foundation.L o n d o n .5 2 “Financing urban water utilities: the costs of money”,D raft background note prepared for the AEPF 5-9 September 2004

in Hanoi, Vi e t n a m , by Bernhard Hack5 3 Jude Esguerra speaking at the workshop on Financing Public Wa t e r, J a n u a ry 19 2004,Wo rld Social Foru m , M u m b a i .

h t t p : / / w w w. wa t e r j u s t i c e. o rg / a rt i c l e. p h p ? s u b S e c t i o n I D = 1 & a rt i c l e I D = 4 25 4 The city issued a municipal bond that received a credit rating of A A . Bonds backed up by gov e rnment guarantees are usu-

ally considered a very safe inv e s t m e n t .“ Water Finance - a Discussion Note” David Hall,P S I R U, J a n u a ry 2004.h t t p : / / w w w. p s i ru . o rg / r e p o rt s / 2 0 0 4 - 0 1 - W- f i n a n c e. d o c

5 5 In this case, it is the good financial standing of the utility that makes it possible to access finance.Thabani Myeza speakingat the workshop on Financing Public Wa t e r, J a n u a ry 19 2004, Wo rld Social Foru m , M u m b a i .h t t p : / / w w w. wa t e r j u s t i c e. o rg / a rt i c l e. p h p ? s u b S e c t i o n I D = 1 & a rt i c l e I D = 4 2

21

TNI is curr e n t ly co-ordinating a book project providing dive rse positive examples of how thep e r fo rmance of public water utilities has been improved by increasing citizens part i c i p a t i o nand control.The book (to be published in Janu a ry 2005) will provide an inve n t o ry of publ i cwater solutions and key lessons-to-be-learn e d , as well as identify obstacles to consolidatingand replicating these models. Case studies will include cities like Po rto Alegre and Recife( B ra z i l ) , Santa Cruz and Cochabamba (Bolivia), Bogota (Colombia), Buenos Aires (Arg e n t i n a ) ,C a racas (Ve n e z u e l a ) , Manila (The Philippines), Dhaka (Bangladesh), J a k a rta (Indonesia),Penang (Malay s i a ) , K e rala (India), H a rrismith (South A f ri c a ) , S avelugu (Ghana), G r e n o bl e( F ra n c e ) , Odessa (Ukra i n e ) ,T h a i l a n d , S l ov a k i a , G e rm a ny, Mexico and the US.

The website waterjustice. o rg came out of the fo u rth Wo rld Social Forum (Mumbai, J a nu a ry2 0 0 4 ) . Inspired by seminars on altern a t i ves to water privatisation and how to finance publ i cw a t e r, groups from around the wo rld committed to intensified co-opera t i o n . One of thedecisions was to develop waterjustice. o rg into a vir tual resource centre and meeting placefor exchanging experi e n c e s , debate and stra t e g i s e.Wa t e r j u s t i c e. o rg is an open space to connect people from around the wo rld dedicated toe f fe c t i ve, d e m o c ratic and equitable water solutions, including community activists, NGO cam-p a i g n e rs , academic researchers , t rade unionists and water utility managers .The success of thewebsite will depend pri m a ri ly on the active participation of these dive rse groups.The site hasa content management system which allows you to upload contri butions (from art i c l e s ,r e p o rt and case studies to calls for action and campaign news) and a discussion fo rum fo rs h a ring opinions on water justice issues.We warm ly invite you to get invo l ved!

TNI manages two email listser ves on water justice issues.The [waterjustice] listserve facilitatesinformation exchange and strategy debate among activists from around the world campaigningfor people-centred alternatives to water privatisation. The [waterstrategyamsterdam] listser veis dedicated to follow-up from the water strategy meeting in Amsterdam (October 2003),suchas further development of strategies and activities on areas like solidarity campaigning, GATSand water, EU water policies,International Financial Institutions and alternatives to privatisation.For more information, contact <satoko@tni.org >

R E C L A I M I N G P U B L I C WAT E R ! Debate Papers October 200422

g G AT S w a t c hG ATSwatch brings together the growing bodyof NGO and academic critique of the W TOs e rvices agreement and ongoing liberalizationt a l k s .w w w. g a t sw a t c h . o r g

g ASSEMAE (Associação Nacional dosS e rviços Municipais de Saneamento)P ro g re s s i ve federation of public water utilitiesin Brazil.w w w. a s s e m a e. o r g . b r

g R E D E SFriends of the Earth Uruguayw w w. re d e s . o r g . u y /

g Public Services International (PSI)The international trade union federation ofpublic sector wo r ke r s , i nvolving more than600 trade unions in over 140 countries.w w w. wo r l d - p s i . o r g

g Public Services International Researc hU n i t :For a wealth of re s e a rch on water privatisa-tion and public water, go to:h t t p : / / w w w. p s i r u . o r g / re p o rt s i n d e x . a s p

g E u ropean Federation of Public Serv i c eU n i o n sh t t p : / / w w w. e p s u . o r g /

g Public Citizen Campaigning to keep water as a public trust.w w w. c i t i z e n . o r g / c m e p / w a t e r

g Polaris Institute Canadian institute campaigning against GAT Sand for public serv i c e s .h t t p : / / w w w. p o l a r i s i n s t i t u t e. o r g /

g Friends of the Earth International (FOEI)Federation of autonomous env i ro n m e n t a lorganizations from 68 countries.w w w. fo e i . o r g / w a t e r / i n d e x . h t m l

g Council of CanadiansCampaigns to ban the bulk export of water and head off commodification and p r i v a t i z a t i o n .w w w. c a n a d i a n s . o r g /

g World Development Move m e n tThe UK-based WDM campaigns tackle theroot causes of pove rt y.w w w. w d m . o r g . u k /

g Institute for Popular Democracy (IPD) is a political re s e a rch and advocacy institute serving social movement gro u p s ,n o n - government organizations (NGOs) ind evelopment wo r k , and pro g re s s i ve localgovernment officials.h t t p : / / w w w. i p d . p h / a b o u t / a b o u t . h t m l

g F reedom Debt Coalitionh t t p : / / w w w. f re e d o m f ro m d e b t c o a l i t i o n . o r g /

g Jubilee South is a network of jubilee and debt campaigns,social move m e n t s , people's organizations,c o m mu n i t i e s , NGOs and political fo r m a t i o n s .h t t p : / / w w w. j u b i l e e s o u t h . o r g /

TNI, founded in 1974 is an inter-national network of committedactivist-scholars,committed tocritical analysis of the global pro-blems of today and tomorrow. Itaims to provide intellectual sup-port to those movements con-cerned to steer the world in ademocratic, equitable and envi-ronmentally sustainable direction.

The TNI Alternative Regionalismsprogramme aims to address thequestion of alternative develop-ment from the perspectives ofsocial movements and regionalcoalitions of civil society organi-sations in Africa,Asia and Latin-America and seeks to effectivelyinfluence the shape and substan-ce of regional governance in theSouth.It facilitates cross-regionalexchanges on a South-Southbasis,as well as with counter-parts in the North,particularlythose working on EU & US stra-tegies vis a vis the regions of theSouth.It links campaigners andresearchers in the developmentof policy alternatives in the areasof trade, investment and socio-economic development,waterand energy privatisation,sustaina-ble environment and security andpeace.The programme is jointlyinitiated by the TNI,AIDC (SouthAfrica),Focus on the Global South(Thailand),IBASE (Brazil),andRMALC (Mexico).

Corporate Europe Observatory(CEO) is an Amsterdam basedresearch and campaign group tar-geting the threats to democracyequity, social justice and the envi -ronment posed by the economicand political power of corpora-tions and their lobby groups.

Due to the ideology-driven privatisation wave, the 1990’s wasessentially a lost decade for the struggle for clean water for all.High-profile privatisation failures in major cities of the Southprovide ample evidence that the water needs of the poor shouldnot be left in the hands of profit-driven transnational water cor-porations.The time has now come to refocus the global waterdebate to the key question:how to improve and expand publicwater delivery around the world?

Important lessons can be learned from people-centred, participa-tory public models that are in place or under development incities like Dhaka (Bangladesh), Cochabamba (Bolivia), Savelugu(Ghana) and Recife (Brazil), to mention a few. In these cities,public water supply has been improved through increased popu-lar control and other democratic reforms. In all their diversity,these models provide inspiring and viable alternatives both to fai-ling state-run utilities and profit-driven private water manage-ment.

This TNI Briefing Reclaiming Public Water! is produced by theWater Justice project as part of TNI’s Alternative Regionalismsprogramme.The Water Justice project is developed jointly withCEO and focuses on strengthening international solidarity incampaigning against water privitisation as well as on promotingpeople-centered alternatives.

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