Water, no commercial good
In a ministerial declaration at the end of the 3rd World Water Forum of March 2003 in Kyoto it was declared that the access to water is a basic need (and not a right) and that water must be treated primarily as an economic good (and not only as a social good). It was also declared that water should get an economic value according to the market price which allows for the recovery of the total production costs (profits included).
Considering water as an economic good is a recent idea. Since the neo-liberal tide of the 1980s "the open market” has been regarded as the ideal instrument for an "efficient allocation" of goods and services, also of vital services such as water supplies. Thus for the World Bank and most international organisations, the private sector, with its capital and its technical and management knowledge, is the most suitable actor to reach the Millennium Goals. Moreover, they think that private companies function more efficiently and that as a result, the cost of water will decrease. It follows that the World Trade Organisation fully supports the process of liberalisation of the service sector and lays it down in the aforesaid GATS-agreements.
Within the framework of the SAP’s the International Monetary Fund and the World Bank are now pressing many developing countries to privatise their water supplies’ management. One of their motives for doing so is to ensure that the latter would have the necessary funds to pay off their foreign debts.
Yet privatisation hasn’t by any means always provided the required result. Studies demonstrate that private companies in a non-competitive market (for mostly a monopoly situation is involved) are not necessarily more efficient than other forms of management. Abuses and corruption occur in the private sector too. In many cases in the South the water price multiplied after privatisation of the drinking water sector: e.g. Bolivia, Argentina, the Philippines... .
In "access to water for everyone" people asked to press the European Commission to withdraw the 72 calls for the liberalisation of water supply services within the framework of the so-called “GATS"-negotiations. The GATS (General Agreement on Trade in Services) is one of the World Trade Organisation’s (WTO) multilateral agreements on trade. In this agreement, that mostly has eyes for liberalisation, arrangements and obligations concerning the international trade in services are laid down. Apart from education, public transport, patient care, gas and electricity, water supply services too would be liberalised. Thereby the EU covetously looks at water markets in the rest of the world, but does not at all offer its water sector to others.
In March 2006 it turned out that in EU countries that liberalised the environmental services (among which water supply services) the drinking water distribution was no longer taken on. Consequently, the European Commission no longer insists on the liberalisation of environmental services within the framework of the general GATS- negotiations. However, in its individual discussions with certain countries the Commission may well continue to insist on the liberalisation of drinking water services. Moreover the common call still contains the liberalisation of effluent water purification. In many countries this service is inextricably linked with drinking water supply services, and so one thing can lead to another.