May 26, 2005

Water Privatization Plan Goes Awry in Tanzania

by Sandy Hager

The Dominion - http://www.dominionpaper.ca

A water privatization plan in Tanzania backed by the IMF, World Bank, and the British government and run by a British-German-Tanzanian conglomerate named City Water Services has been canceled by the Tanzanian government just two years into the project's ten year contract.

A Tanzanian government official cited in Forbes magazine claims that the privatization plan, which was to provide better water service to the country's capital Dar es Salaam, has in fact led to the deterioration of the city's water supply. The official blames City Water Services for investing only half the amount needed to replace worn out parts in the city's water supply system and to expand the water supply network.

Peter Hardstaff, head of policy for the World Development Movement, blames not only the company but also questions the development policies of the world's financial institutions and western governments, which are the key proponents of water privatization in the developing world.

"This is yet another example of water privatization failing to deliver clean water to poor communities. Rich country governments and the IMF and World Bank must abandon their support for this disastrous policy. It is a scandal that the UK aid budget, money that should go to reduce poverty, was used to push water privatization in Tanzania," explained Hardstaff to Accra's Public Agenda newspaper.

The Guardian reports that the collapse of this project will throw into question many other water privatization projects around the world. The newspaper notes that demonstrations and increased "resentment against private water monopolies" are already occurring in South America, Africa, the Caribbean and Asia as more and more western companies are accused of raising prices beyond what most in the developing world can afford.

allAfrica.com: UK Water Company Kicked Out of Privatisation Contract

Forbes: Tanzania Scraps Deal With Water Company

Business Week: Tanzania scraps deal with water company

The Guardian: Flagship water privatisation fails in Tanzania