NGOs Urge Rich Countries to Pull the Plug on World Bank’s Push Water Privatisation

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Over a hundred-and-thirty groups from forty-eight countries are calling on donor governments to abandon support for a highly controversial agency of the World Bank focused on privatisation called the 'Public-Private Infrastructure Advisory Facility' (PPIAF).

On May 23 the Dutch capital, The Hague, will host a meeting of the 13 donors to the PPIAF. In an open letter, groups argue that PPIAF’s bias towards private sector ‘solutions’ to water access represents a poor use of aid money. Earlier this year, the Norwegian government stated that it will not support PPIAF in the future as it no longer believes it is increasing access to water for the poor.

In the letter to PPIAF’s remaining donors, signed by civil society groups and trade unions from around the world, including poor countries where PPIAF has funded water privatisation processes, campaigners say: “The evidence shows that the private sector has shown a great reluctance to commit finance to connecting the poorest people to clean, affordable water…. Our conclusion is that aid could be better spent and we ask donors to withdraw this funding accordingly.”

Elías Dias Peña of Friends of the Earth in Paraguay says, "In Paraguay, despite public protest and a parliamentary vote against it, water privatisation is still pushed by the PPIAF, the International Monetary Fund and powerful private companies. But opposition remains strong. A new law on water developed by civil society groups and members of Parliament declares water a property of the state and access to water a fundamental human right. The law is awaiting its final vote in the Paraguayan chamber of deputies right now.”

Denied permission to observe PPIAF’s annual meeting, campaigners are organising a forum in The Hague on 22 May to discuss PPIAF, its role within the World Bank and progressive alternatives in the area of water.

On PPIAF’s agenda at the meeting in The Hague is a proposal to extend its remit further and give the controversial agency a stronger role in World Bank water policies. Activists believe that donors should reject this extension and instead create a wholly new fund to support water utilities in the global south based on ‘public-public partnerships’.

They argue that PPIAF undermines the right of poor countries to decide how to run their public services. PPIAF has funded projects in many poor countries where international financial institutions like the World Bank and the International Monetary Fund have attached water privatisation
conditions to loans, debt relief or aid.

Campaigners are particularly critical of PPIAF’s funding for ‘consensus-building’ projects which try to persuade people in developing countries to accept water privatisation.