Newsletter on the Right to Water Around theWorld Feb 08

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February's Defend the Global Commons: News from Food & Water Watch

In this issue

 

Arbitration Panel Rules against Biwater in Tanzania Privatization The Thorny Side of Valentine's Flowers Facing Protest, Bechtel Plans to Leave Ecuador New Bolivian Constitution Would Support the Right to Water

 

 

Arbitration Panel Rules against Biwater in Tanzania Privatization In a major victory for the effort against water privatization, an international arbitration panel unanimously ruled on January 10th that Biwater's subsidiary City Water Services (CWS) breached a privatization contract in Dar es Salaam, owing Tanzania $8 million in damages. Both the Tanzanian government and City Water Services have been in legal disputes since 2005, after problems with water and sewage services led the government to seize back control of the water system from CWS. The settlement is a major success for the Tanzanian government and civil society groups who have documented how Biwater failed to fulfill any of the performance measures set out in the contract, and sets an important precedence for failed water privatizations across the world. However, Biwater is not giving up so easily. Anticipating the outcome from the panel, Biwater launched a parallel case at the International Centre for Settlement of Investment Disputes (ICSID), claiming Tanzania owes the company $20-25 million. The ICSID case gives an unfair advantage to Biwater, because unlike the international arbitration panel, the ICSID case will only consider claims from Biwater, leaving out any counter claims Tanzania may have. In addition, Biwater unloaded its subsidiary Cascal on Wall Street in the United States just days after the Tanzania ruling. Biwater had initially planned to raise as much as $365 million with an average share price of $18, but instead, Cascal raised only $144 million with a share price of $12. This disappointing result in the rushed sale is a reflection of the American public becoming wary of water privatization and the companies that dump bad investments on Wall Street investors and American ratepayers. For more background on the Tanzanian case, For more information on ICSID, see Food & Water Watch's report, Challenging Corporate Investor Rule, which calls for reform of the undemocratic and flawed ICSID process.

 

 

The Thorny Side of Valentine's Flowers As St. Valentine prepares to launch himself on another February flight of romance filled with flowers, you may want to know that many of the roses and other flowers that symbolize Valentine's Day come from Lake Naivasha in Africa. Its waters shimmering amidst Kenya's rift valley, the lake is renowned for its beauty and the hippos, birds, and other wildlife basking along its banks. But the story of Naivasha is not all roses, for a dark and thorny side lurks. A cadre of transnational flower farms has spent decades assaulting the lake, its environs, and its people. These industrial operations have depleted the waters and poisoned them with pesticides to grow flowers for shipment to Europe and other wealthy destinations. Meanwhile, people laboring in the farms have little choice but to accept corporate abuse and low pay. Despite these concerns, the flower industry is as dominant as ever, and will continue to impact the local community and environment until international action is taken. On January 31st, Food & Water Watch released a report entitled, "Lake Naivasha: Withering Under the Assault of International Flower Vendors," that aims to look closely at how the flower industry is contributing to the area's environmental decline, and highlights current efforts to save the region and the lake. The report was originally scheduled for release on Valentine's Day but moved up due to the situation in Kenya and outrageous news coverage sympathetic to the flower industry. Headlines such as, "Kenya violence upsets flower production ahead of Valentine's Day" in the International Herald Tribune and "Kenya's blooming industry is facing hard times" in the UK Telegraph, are just a few examples. Hundreds of people have been killed and thousands displaced due to increasing violence. "The situation in Naivasha is a human tragedy, not an investment loss. Our sympathy and aid should go to the people in the region, not the international corporate owners of these flower farms that exploit the workers, the lake, and the environment," Hauter said in a press release. The report on Lake Naivasha was prepared by Food & Water Watch and the Council of Canadians to launch a campaign to protect the lake and the local communities that surround it. The campaign will urge the Kenyan government to promote small-scale agriculture and eco-tourism and encourage consumers in Canada, Europe, and the United States to purchase local, ecologically sustainable flowers.

 

 

Facing Protest, Bechtel Plans to Leave EcuadorAfter years of poor service, water cut-offs, flooding, and unsafe drinking water, the residents of Guayaquil, Ecuador are organizing to demand their human right to clean and affordable water, and putting more pressure on the company that caused their water difficulties, Bechtel. In October 2000, just months after massive citizen protests threw Bechtel out of Bolivia, a local Bechtel subsidiary, Interagua, signed a 30-year concession contract to run the water and sanitation services in Guayaquil, Ecuador's largest city. Bechtel promised to invest $1 billion, connect 55,000 new users and increase coverage to 90% for water and 60% for sewerage treatment. Instead, Guayaquil residents have suffered seven years of periodic water cut-offs, flooding, a tripling of water rates, and contaminated water (including a Hepatitis A outbreak in 2005). In 2007, the Ecuadorian regulatory agency ECAPAG fined Interagua $1.5 million for contractual violations, and in January 2008, a local judge ordered a prison sentence for the manager of Interagua for contempt and failure to fulfill the obligation to provide water services. As a result of these decisions and mounting citizen complaints, Bechtel is now trying to sell the company. But before Bechtel leaves the country, local residents are demanding compensation. They are seeking damages for the water contamination, an end to the water cut-offs, and the return of all water services to local, public control. A local advocacy organization, the Observatorio Cuidadano de Servicios Publicos, which originally exposed the constitutional, legal and contractual violations of Interagua, is working to ensure that Interagua takes responsibility for its failure and is seeking to stop the water cut-offs through legal action. Don't Let Bechtel off the Hook in Ecuador! Tell Bechtel to live up to its responsibility before it leaves Ecuador.For more background on Bechtel in Ecuador,

New Bolivian Constitution Would Support the Right to Water In 2006, Bolivia elected President Evo Morales, an Aymara Indian with a progressive agenda and a campaign for change. One of his most significant initiatives was the establishment of a Constituent Assembly that would draft a new Bolivian constitution. But instead of establishing a popular- based assembly, it became, as commentator Jim Schultz put it; "just one more party for the political parties." The Constituent Assembly faced intense criticism throughout 2007, and violence erupted across the country. Despite the criticism, the new draft constitution has several promising articles on water, including Article 16 which states that every person has the right to water and food, and Article 20 which adds that every person has the universal right of access to basic services like water, sewage, electricity, gas, telecommunications and transport. The draft constitution further states that indigenous people will be able to manage, build and maintain the water systems in their own territories. Finally, the constitution guarantees "the state will protect the use of water for life." While this draft constitution considers many of the demands made by social movements over the years, there is widespread concern that current policies and economic priorities will prevent the full implementation of the constitution. Bolivians now prepare for a popular vote that would approve or reject the new constitution.--~--~---------~--~----~------------~-------~--~----~To to this group, send email to: MedicalConspiracies- (AT) googl (DOT) com