The Water Rights Grab: Big Business, Investors Push for Privatization

The Water Rights Grab: Big Business, Investors Push for Privatization The World Water Forum held its fifth tri-annual conference in Istanbul last week, highlighting concerns and divergent opinions about how our most precious natural resource is harvested, used and managed.

The Forum was sponsored by the World Water Council, a multi-stakeholder coalition of government, public and private sector organizations critics contend is largely a front for a worldwide campaign by private, multinational water companies whose aim is to persuade governments to cede water rights and management to the private sector.

Turning water into a commodity like oil and leaving it to multinational corporations and the private sector to own and manage, they say, not only exacerbates poverty, raises environmental risk and increases the potential for social disruption and conflict, it further burdens farmers, ranchers and small businesses in economic sectors that aren’t currently able to pay the rates necessary to meet the return on investment (ROI) thresholds private sector companies and their shareholders require.

Public or Private Good?

Is water more of a private or public good? The issue strikes at the heart of a fundamental issue in economic theory, as well as environmental rights and social justice. Should water resources be collectively owned, managed and governed by a public-private coalitions of direct and “downstream” stakeholders, or would it be better to privatize water resources and leave it to private businesses and the market to determine the price of water and how best to allocate it?

More than one billion people around the world lack access to clean drinking water. That number’s expected to double in 20 years, while water quality overall is expected to decline due to ongoing pollution, according to the UN World Health Organization and Children’s Fund.

The fifth World Water Forum is said to have attracted some 25,000 participants. It appears to have generated more controversy and more in the way of public demonstrations than the Turkish government was probably anticipating or cared for.

The purpose of the conference was four-fold, according to World Water Forum organizers:

* To raise the importance of water on the political agenda;
* To support the deepening of discussions towards the solution of international water issues in the 21st century;
* To formulate concrete proposals and bring their importance to the world’s attention;
* To generate political commitment.

Ricardo Petrella, secretary general of the International Committee for the Global Water Contract, is one of a number of water rights policy experts that sees a more sinister, troubling agenda underlying the strategy of the Forum’s organizers, the World Water Coalition.

More specifically, Petrella and other critics condemn the efforts of multi-national business and investment groups who are gradually but successfully acquiring control of water resources worldwide.

“The water report to be presented at the World Water Forum in Istanbul confirms once again the link between poverty and the problem of access to water as it was set forth in 2006, when the United Nations development program was elaborated. As to the rest, the United Nations’ position is still influenced by the World Water Council (WWC).

“Controlled by multinational groups of that industrial sector, this private organization has succeeded in imposing itself as an unavoidable intermediary for a number of governments and international institutions. Moreover, it has achieved acceptance of the idea that attaching economic value to water is necessary for resolving the issues of access to water and sanitation,” Petrella was quoted as saying in a report on People’s Weekly World.

The Global Water Contract

Petrella is the author of “The Water Manifesto” and a proponent and advocate of “The Global Water Contract,” an alternative framework for guiding water resource use and management, a fundamental tenet of which is that access to water should be considered a basic human right.

“According to WWC, attributing commercial value to water would encourage private groups’ interest and make it possible to implement investment necessary for mitigating both problems. Such a concept is dangerous. It gives a blessing to converting water into a commodity. Far from reducing the problem of access to water, it is likely to aggravate it. Once water becomes a precious economic asset, the risk of water-related conflicts increases.

“Commercial value of water turns this element essential for human life into a commodity similar to fossil energy. Some want to push it even further and to quote a global water price, as is the case for oil. I ask myself the question—has anyone observed an increase of oil prices encouraging more economical use of the energy or relieving international tension?”

Industrialism and the Producer-Consumer Schism

The growing controversy over privatization of water resources also brings to light a fundamental dichotomy brought about by industrialism of whatever form–the schism between individuals as producers and consumers of basic goods and services, an observation and powerful insight I originally came across when I first read Alvin Toffler’s “The Third Wave” back in the early 1980s.

In agricultural societies people in small communities were for the most part directly involved in producing pretty much everything they consumed–food, water, clothing, etc. The rise of industrialism– whether in the US or the USSR, Western Europe or communist China– drove a wedge between and separated that relationship, creating a sort of ‘schizophrenia’ and tension in people’s psyches as well as the nature and type of roles they play in society that has only intensified as industrialization has evolved, grown and spread.

The apparent contradictions and conflicts of this are apparent all around us. With our savings tied up in homes, property and financial markets through 401Ks and pension plans we cheer and enjoy the ride as market prices and corporate profits rise and asset bubbles inflate while at the same time bemoaning and decrying the crashes, frauds, scandals, corruption, rising living costs, loss of jobs and the environmental and human, as well as monetary, costs and resource shortages that result.

In the US, it seems we’ve become or aspire to become consumer sophisticates with an inalienable right to live lifestyles of the rich and famous and consume all manner of exotic, luxury consumer, as well as low-priced basic goods from all around the world. At the same, we support the ‘Save the Zebra’ foundation and Community Supported Agriculture. We call for an end to dependence on fossil fuels and foreign oil and the international military actions they’ve spawned yet have not been willing or able to pay the price or make the trade-offs necessary to develop a diversified base of cleaner, renewable domestic energy resources.

Reconciling these tensions requires a fundamental rethink and restructuring of resource usage, corporate social responsibility, government oversight and governance from the local on through regional, national, multinational and international levels, as well as adapting our behavior as producers and consumers of goods and services to be much more in tune with life in a much more resource-constrained world.

Andrew Burger
Andrew Burger
A product of the New York City public school system, Andrew Burger went on to study geology at the University of Colorado, Boulder, work in the wholesale money and capital markets for a major Japanese bank and earn an MBA in finance.

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