Last Updated: Friday - 09/24/2010

Bolivians thirst for just water policy

Less than 0.5 per cent of the world's available water is fresh. Ninety per cent of this is used for industry and agriculture.

It is estimated that by 2025 two-thirds of the world's population will face severe water shortages. Some view the growing demand for a dwindling supply of water as a potential source of conflict. Others see the shortage as a potential source of profit.

The World Bank estimates the global market for water to be around $800 billion. Corporate giants are jockeying to control this essential commodity.

The global trend to privatize public utilities will only heighten the possibility for violent confrontation. Ismail Serageldin, vice president of the World Bank, predicted some years ago that the wars of the 21st century will be fought over water; others point out that local conflicts have already taken place.

The recent conflict in Cochabamba, Bolivia, over the privatization of the water system is an example of what is to come.

Two years ago the World Bank, which has official representation at all Bolivian cabinet meetings, refused to guarantee a $25-million loan to refinance the Cochabamba water services, unless the public system was sold to the private sector. In this heavy-handed manner, the World Bank fulfilled its own prophecy.

Cochabamba sold its water to a conglomerate of British investors led by Bechtel, the California-based engineering company. Bechtel is involved in another water related drama regarding China's Three Gorges Dam which forced 1.3 million people off their ancestral land.

The privatization of water is just the latest in a decade of sales in Bolivia public enterprises to international private investors, including public transportation, education and the electric utilities. The result has been lower labour standards, higher prices and reduced services.

In January 1999, the new owners announced the doubling of water prices. For many Bolivian families with an income of $100 a month, the $20 water bill was more than the cost of food. For the unemployed and underemployed, the cost of water accounted for half their monthly budgets.

Still, the World Bank announced that "no subsidies should be given to ameliorate the increase in tariffs" and that the poor should pay the full price of the water-for-profit policy.

A year later the citizens of Cochabamba organized a general strike that shut down the city for four days. The government, led by former dictator Hugo Banzer, responded with empty promises.

A coalition of labour, community and human rights leaders announced their plans for a peaceful protest march in February. Banzer responded by sending in the troops who showered the citizens with tear gas and rubber bullets.

Over the next few months the conflict escalated. Almost all civil rights were suspended but massive protest left major areas of the country at a standstill.

Banzer appointed General Walter Cespides, known for his violent repression of civil liberties, as governor of the state of Cochabamba. One of his aides was a graduate of the infamous School of the Americas.

There is a happy end to the story. Martial law lasted till April 19 and then the government gave in to the people's demands.

Bechtel was kicked out of the country. Arrested civic leaders were released. Compensation was given to the families of the injured and killed. Local water control was maintained.

The people of Bolivia scored an important victory over transnational corporatism. Canadians, with their own privatization battles, can learn a lesson from the Cochabambans.

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