Contrary to the claim of the Asian Development Bank (ADB), allowing profit-oriented private corporations to take over the management and distribution of water resources will not address the so-called water insecurity. The experience of countries around the world that have implemented water privatization shows that public-private partnership (PPP) has even worsened the problem.
Research group IBON, secretariat of the nationwide aid network AidWatch Philippines, issued the statement after ADB officials stressed water security as one of the issues to be addressed at the 45th Annual Meeting.
The ADB warned that Asia will face a severe water crisis by 2030, with the shortfall in water supply reaching as much as 40 percent. To address the situation, the multilateral financial institution is drawing up a new framework for water operations that calls for efficiency improvement and greater PPPs.
The experience of the Philippines shows the problems with PPP initiatives in the water sector. The Metropolitan Waterworks and Sewerage System (MWSS) was privatized in 1997, and transferred to private concessionaires Manila Water and Maynilad the task of delivering water to almost 14 million people in Metro Manila and nearby areas.
According to IBON, since the MWSS privatization, water rates have increased by 833.2% in the Manila Water concession areas and 520% in the Maynilad concession areas. Moreover, only 60% of 760,000 households in the service area of Maynilad have 24-hour water supply and more than half of its water allocation are wasted due to leaking pipes and pilferage. Manila Water, on the other hand, claims 99% coverage but this includes those serviced by a third party private contractor often in poor communities. These private companies promised universal access to water by 2001 and a 24/7 water supply.
The group warned that promoting more PPPs in the water sector will aggravate the deteriorating condition of the world’s water supply. Contrary to the aim of “water for all” trumpeted by the ADB, dwindling water resources are likely to be increasingly monopolized by the rich at the expense of poor families who cannot afford escalating user fees common in PPP projects. (end)
IBON Foundation, Inc. is an independent development institution established in 1978 that provides research, education, publications, information work and advocacy support on socioeconomic issues.