Transformation of Water Services: Lessons Learned from Water Privatization in Multiple CountriesMikail Pehlivan, Nazan Susam
The transformation of water services is among the issues that have entered the world agenda in the last 30 years. Although recommendations from international organizations affect water policies of individual countries, water privatization realized as public–private cooperation has been spurred by the idea of establishing new markets for global water companies. This transition is rooted in the neoliberal policies of such international organizations. This study, which follows the literature review method, aims to examine the reasons underlying the privatization of water services as well as the privatization practices implemented in different countries. The results reveal that excluding the countries where privatization is offered as a credit requirement by international organizations (India, Argentina, Bolivia, and Turkey), in developed countries (France and England) where privatization is conducted without coercion, water services management has not been successful and cannot be used as an example for other countries. In contrast, many cities in developed and developing countries have recently implemented remunicipalization, returning the control of water services to public authorities. Finally, countries that have implemented privatization have failed in terms of financing, investment, and efficiency, and the privatization process has imposed additional financial burdens. Water privatization, therefore, cannot be considered as a solution to water management.
Su Hizmetlerinde Yaşanan Dönüşüm: Suyun Özelleştirilmesi ve Ülke Uygulamaları ile Kazanılan DeneyimlerMikail Pehlivan, Nazan Susam
Su ve su hizmetlerinde yaşanan dönüşüm son otuz yıl içerisinde uluslararası düzeyde dünyanın gündemine girmiş olan konulardan bir tanesidir. Uluslararası kuruluşların tavsiyeleri devletlerin su politikalarını etkilemekle birlikte, kamu-özel iş birliği şeklinde gerçekleştirilen özelleştirmeler, uluslararası kuruluşların neoliberal politikaları temelinde, küresel su şirketlerine yeni pazarlar açma fikri çerçevesinde gelişmektedir. Tarama ve değerlendirme yöntemi izlenen bu çalışmada su hizmetlerinin özelleştirilmesinin altında yatan nedenler ve farklı ülke örnekleri çerçevesinde özelleştirme uygulamalarının incelenmesi amaçlanmıştır. Sonuç olarak, uluslararası örgütler tarafından özelleştirmelerin kredi şartı olarak sunulduğu ülkeler (Hindistan, Arjantin, Bolivya ve Türkiye) bir yana, herhangi bir zorlama olmaksızın özelleştirmelerin gerçekleştirildiği Fransa ve İngiltere gibi gelişmiş ülkelerde dahi diğer ülkeler için örnek teşkil edecek bir başarı söz konusu değildir. Öte yandan birçok gelişmiş ve gelişmekte olan ülke şehirlerinde su hizmetlerinin yeniden belediyeleştirmeler ile tekrar kamu otoritesine geçmiştir. Kısacası özelleştirmelerin tecrübe edildiği şehirlere bakıldığında finansman, yatırım ve etkinlik bakımından başarısızlıkla sonuçlandığı görülmektedir. Bu özelleştirmeler, su yönetimine alternatif bir çözüm olamadıkları gibi ülkelere ek maddi külfetler de yüklemiştir.
Although water assumes as an independent course of movement under natural conditions, more and more intervention occurs daily due to human interference. Amidst factors such as population growth, urbanization, industrialization, and agriculture, natural water cycles are affected, creating consequences for water balance, water resources, and water access.
Considering water is a basic need for all individuals, the framing of water as a scarce commodity with limited usage rights that should be managed by the private sector has highlighted the issue of the commodification of water. In this narrative, the privatization of water services for the sake of efficient and effective management is presented as the only solution. Although recommendations from international organizations affect water policies of individual countries, water privatization realized as public–private cooperation has been spurred by the idea of establishing new markets for global water companies. This transition is rooted in the neoliberal policies of such international organizations.
According to neoliberal water policies, water is an economic good. By defining water in this manner, it becomes possible to price and subsequently commercialize the resource, enabling privatization. Therefore, the change of definition allows for the change in management approach. In the current system where public institutions are witnessed as inefficient and unproductive, the path to privatization is built through the deployment of various private sector participation methods in water services.
The study aims to examine the reasons underlying the privatization of water services as well as the privatization methods implemented in different countries. Factors that make the idea of privatization possible and the methods of the private sector for realizing this idea were included in the study, and the water service privatization models of selected countries were examined.
Although water is a natural resource without substitute, water services have been privatized in many countries through the efforts of global capital. In fact, privatization has been presented to many countries by international organizations as a credit condition. Global economic policy, rooted in neoliberalism and capitalism, presents the private sector solution, as the only alternative water management solution to defend against water scarcity. However, this market approach does not reflect the real needs of water management. If efficiency and productivity are the main goals of water management, considering that most water services worldwide are managed via the public sector, then it should be witnessed as rational to identify and eliminate deficiencies than to change the existing order as a whole. However, national water services are being entrusted to global water companies via privatization. Yet when we explore the countries where privatizations have happened, we witness that they have failed in terms of financing, investment, and efficiency, and that the privatization process introduced additional financial burdens. Privatization cannot therefore be witnessed as a practical solution to water management.
After reaching its peak in the 1990s, private sector investment in developing countries started to decline. Multinational companies have been unable to generate sustainable returns, and the privatization process in the water sector has lacked public support and has met with strong political opposition. Moreover, the private sector participation model has nowhere met the exaggerated expectations promised by its advocates. According to the results of the research (Marin, 2009; Zerah ve Jaglin, 2011), which analyzed the performance of more than 65 private sector participation models in developing countries using four criteria (scope extension, service quality, operational efficiency, and tariff changes), very few instances of private sector participation fulfilled even one or two of these criteria. In addition, with water privatizations, it was expected that competition would increase, thereby increasing benefit. However, the expected beneficial competitive environment did not occur for two reasons. The first is that a few water companies operate in the international arena, limiting the potential for competition, and the second is that competition becomes difficult in the presence of long-term agreements such as leasing and concession.
The failure of water privatization is rooted in the haste to entrust water management to the private sector completely, thereby ignoring its social, cultural, and ecological roles. Individuals and the environment always require water. One of the focal points of environmental sustainability and sustainable development is water; therefore, efficiency and productivity must be achieved in water use. In this regard, the public sector should also do its part regarding transparency, accountability, and effective surveillance. The deficiencies of the state in terms of water supply should be eliminated and strengthened. Water is a public good provided by nature, and should therefore, not be subject to profit maximization.