Thursday, March 24, 2005
Water wars: privatization
Private water companies fail to provide service to all customers -- there's a surprise. The farther an industry moves from the assumptions of the free market the better the public sector will be in comparison. Clothes will always be provided by markets, as will electronics and luxuries. But health care and water consistantly show the public sector being more effective. Why because competition and rational choice fail. Water is natural monopoly, especially if you aim for universal service and for health care very few patients are rational, with my recent bout with mono (not the most serious disease on the planet but the case will serve as an illustration) I was will to try any number of things to make me feel better, and my bank acvount shows the effects. That is why medical quaks have had such a long history, but people are desperate and there is rarely a clear measure of success. Back to water....
Jax
ANIL NETTO, INTER PRESS SERVICE - Goaded by international financial institutions and corporate interests, regional governments are pressing ahead with plans for more private participation in water services. And yet all across Asia, water privatization schemes are failing to deliver clean and safe drinking water to communities, despite forcing consumers to pay for a basic human right.
"If you look for a water privatization arrangement that works . . . I cannot think of any," Manila-based Mary Ann Manahan, a researcher with Focus on the Global South, told IPS in a telephone interview. In contrast, the sterling performance of some major publicly managed water utilities in Asia has demolished the argument that private sector participation is the only way to improve efficiency.
Cities like Osaka, Phnom Penh and Penang, where water is publicly managed, have outperformed Jakarta and Manila, two cities with massive privatization arrangements in several key sectors. . .
And yet, privatization schemes are being pushed with vigor by international financial institutions such as the World Bank and the Asian Development Bank, coupled with lobby groups such as the Global Water Partnership and the World Water Council. . . In addition, the European Union has come up with initiatives in the World Trade Organization to pry open national water services to the big foreign players. Indeed, since the mid-1990s, developing countries have been coaxed to privatize water services through 'public-private partnership' or private sector participation. But many of these schemes in Asia have had disastrous results: soaring water tariffs, unmet targets, and crippling financial losses and debt. (Link)
Jax
ANIL NETTO, INTER PRESS SERVICE - Goaded by international financial institutions and corporate interests, regional governments are pressing ahead with plans for more private participation in water services. And yet all across Asia, water privatization schemes are failing to deliver clean and safe drinking water to communities, despite forcing consumers to pay for a basic human right.
"If you look for a water privatization arrangement that works . . . I cannot think of any," Manila-based Mary Ann Manahan, a researcher with Focus on the Global South, told IPS in a telephone interview. In contrast, the sterling performance of some major publicly managed water utilities in Asia has demolished the argument that private sector participation is the only way to improve efficiency.
Cities like Osaka, Phnom Penh and Penang, where water is publicly managed, have outperformed Jakarta and Manila, two cities with massive privatization arrangements in several key sectors. . .
And yet, privatization schemes are being pushed with vigor by international financial institutions such as the World Bank and the Asian Development Bank, coupled with lobby groups such as the Global Water Partnership and the World Water Council. . . In addition, the European Union has come up with initiatives in the World Trade Organization to pry open national water services to the big foreign players. Indeed, since the mid-1990s, developing countries have been coaxed to privatize water services through 'public-private partnership' or private sector participation. But many of these schemes in Asia have had disastrous results: soaring water tariffs, unmet targets, and crippling financial losses and debt. (Link)
