WORLD: The Planet is Running Out of Fresh Water

The private sector was the first to notice: the planet is running out
of fresh water at such a rate that soon it will be the most valuable
commodity on earth. Thirty-one countries are facing severe water stress
and over one billion people have no access to clean water. Every eight
seconds a child dies of water-borne disease. And the crisis is getting
worse. By 2025, with an ever-greater number of people sharing the
earth's finite supplies of water and its per capita use having more
than doubled, two-thirds of the world's people will not have enough water
for the basics of life.

On March 16 the third World Water Forum (WWF) will be held in Kyoto,
Japan. The WWF is sponsored by the World Water Council, a thinktank
whose membership includes the World Bank, global water corporations,
the UN, governments and the International Private Water Association. They
will decide whether transnational corporations or governments and local
communities will control the earth's dwindling supplies.

The second WWF took place in the Hague three years ago. Designed as a
showcase for public-private partnerships, it sought to create a
"consensus" among the 5,400 participants that privatisation is
the answer to the water crisis. The World Water Council presented a
prewritten "world water vision" endorsing an aggressive
for-profit future for water and declared that it is not a basic human right but a need that can be delivered by the private sector.

When the forum closed, a coalition of environmentalists, human rights
and anti-poverty activists, small farmers, unions and local communities
fighting water privatisation, called the Blue Planet Project, issued a
strong condemnation of both the process and the prearranged outcome of
the meeting. Since then, these activists have protested alongside the
poor in South Africa, Bolivia and India.

Water for profit takes several forms. Backed by the World Bank and the
IMF, a handful of transnational corporations are seeking to cartelise
the world's water delivery and wastewater systems. Already Vivendi and
Suez of France deliver private water services to more than 200 million
customers in 150 countries. Now they are moving into new markets in the
third world, where debt-struck governments are forced to abandon public
water services and hand over control of water supplies to for-profit
interests.

These companies have huge profits, charge higher prices for water and
cut off customers who cannot pay. There is little transparency in their
dealings, they produce reduced water quality and have been accused of
bribery and corruption. Based on the policy known as full-cost recovery
(charging for the full cost of water, including profits for
shareholders) the water companies are able to impose rate hikes that
are devastating to millions of poor people who are forced to use
cholera-laced water systems instead. In Ghana, just the prospect of
World Bank-imposed water privatisation resulted in a 95% increase in
water fees.

A new type of water consortium has emerged in Germany that may be a
prototype for the future. Companies such as AquaMundo put together
giant investment pools using overseas government aid, private bank
investments and public utilities funds in the recipient country. In an arrangement called cross-border leasing, they hire local contractors to run the
water services. Some investment companies keep their money in tax
havens, avoiding national taxes, and offer a deal to cash-strapped
governments. In these public-private partnerships, the private investor
is guaranteed huge profits from the public purse for many years, and if
the company or investment pool disappears, the local government is left
holding the bag.

The bottled water industry is growing at an annual rate of 20%. Last
year, nearly 100bn litres of bottled water were sold around the world,
most of it in non-renewable plastic. Fierce disputes, mostly in the
developing world, are being waged between local communities and
companies such as Coca-Cola and Nestl aggressively seeking new
supplies of "boutique water". Perrier is being taken to court
by citizens in Michigan and Wisconsin in a dispute over licences to take
huge amounts of aquifer water that feeds the Great Lakes of North
America. In India, whole river systems, such as the River Bhavani in
Tamil Nadu state, have been sold to Coca-Cola even as the state is
suffering the worst drought in living memory. As one company explains,
water is now a "rationed necessity that may be taken by
force".

Corporations are now involved in the construction of massive pipelines
to carry fresh water long distances for commercial sale, while others
are constructing supertankers and giant sealed water bags to transport
vast amounts across the ocean to paying customers. The World Bank says
that "one way or another, water will soon be moved around the world
as oil is now". All of these forms of water privatisation are protected
in international trade regimes like the World Trade Organisation. A
recently leaked document showed that the EU has put water services high
on its list of demands of other countries in the ongoing General
Agreement on Trade in Services talks. This should come as no surprise,
as the European water companies are powerful players in the service
industry lobby and advise governments and trade negotiators alike in
the drafting of these deals.

These are the issues that will dominate the WWF and over which a battle
for hearts and minds will be waged. The stakes for a world running out
of water have never been higher.

Maude Barlow is a co-founder of the Blue Planet Project and the author,
with Tony Clarke, of Blue Gold, The Fight to Stop Corporate Theft of
the World's Water (Earthscan).

• 187 Privatization
• 190 Natural Resources
• 194 World Financial Institutions