New Internationalist

Stalling The Big Steal

Issue 354

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Water / PRIVATIZATION

 
The IMF and World Bank are prising open the water market in Ghana - whether ordinary people can afford it or not. Rudolf Amenga-Etego reports on a crime in the making and the fightback.
Stalling the big steal

Photo: Caroline penn / Panos Pictures

Ghana's most celebrated comedian, Ajax Bokana, once described the IMF as the International Monsters Fraternity and the World Bank as the World Bullies. He meant, of course, to make people laugh at their worries. But one particular worry just won't budge - the creeping privatization of Ghana's drinking water.

After two decades of structural adjustment imposed by the International Monetary Fund and the World Bank in which literally anything that could be sold was sold, Ghana still remains 'a highly indebted and poor country'. In May 2001 the then Minister for Works and Housing Kwamena Bartels, speaking on behalf of President John Agyekum Kufour, admitted what was common knowledge: 'After 20 years of implementing structural-adjustment programmes, our economy has remained weak and vulnerable and not sufficiently transformed to sustain accelerated growth and development. Poverty has become widespread, unemployment very high, manufacturing and agriculture in decline and our external and domestic debts much too heavy a burden to bear.'

For the 13.5 million Ghanaians who live in urban slums and rural areas and who represent 75 per cent of the population, even this rare honesty from a minister of state was an understatement. Since 1995 when the World Bank pushed the Ghanaian Government to develop specific options to privatize the country's water service, the poor have been systematically deprived of their right of access to safe water. The price of water has been increasing at an alarming rate, in order to set the stage for the Bank's treasured principle of 'full cost recovery'. Pro-privatization consultants hand-picked by the World Bank are peddling it for all they're worth, turning the Bank's involvement into a front for the transnational corporations interested in taking over Ghana's water. Leading the pack are the French companies Vivendi, Suez Lyonnaise and Saur. In hot pursuit is Biwater of Britain. In March 2002 the IMF stated that Ghana would get the next tranche of its loan under the so-called Poverty Reduction and Growth Facility only if it aimed for full cost recovery in all public utilities, including water.

The World Bank has protected the interest of the corporations from the onset by carefully designing a business framework that cherry-picked the lucrative urban water service for the incoming corporations, leaving the less tempting sewerage and sanitation bits and rural water provision for local authorities and communities to manage. The IMF complemented this by imposing an automatic tariff-adjustment formula that effectively indexed the price of water in Ghana to the US dollar. Susanna Mensah of Madina summed it up when she asked at a recent community meeting called to discuss water-rate increases: 'The rain does not fall only on the roofs of Vivendi, Suez, Saur and Biwater, neither does it fall only on the roofs of the World Bank and the IMF; it falls on everyone's roof. Why are they so greedy?'

Bids which ought to be in the public domain are being treated as secret documents

Faced with dwindling revenues, increasing poverty and deeper cuts in social expenditure by the central government, local authorities have been unable to cope with the costs of managing wastewater and sanitation. Open sewers have become commonplace in all the cities of Ghana. Mountains of garbage compete with residential buildings for space. Typhoid and cholera have become leading killers in the cities. The Ministry of Health has estimated that 70 per cent of diseases in Ghana are water related. Yet projects to expand water services to the urban poor are being frustrated by the World Bank and the British Department for International Development who are withholding funding pending the signing of the deal giving the water transnationals the go-ahead. This despite the fact that privatization has already effectively begun through exorbitant pricing. Most bizarrely the proposed terms of the contract for privatization contains no obligation on the part of the incoming transnational corporations to provide water to urban low-income communities (in World Bank speak); that burden remains with the highly indebted Ghanaian Government  and the communities themselves. The Bank and the corporations are only interested in supplying water to affluent communities who have the ability to pay so-called 'market tariffs'.

The plan for impoverished rural areas is even more absurd. The intended privatization has shifted responsibility for providing drinking water through the construction and maintenance of wells and boreholes from the national government to local communities. This is a master stroke of IMF/World Bank policy, intending to downsize the national budget in order to save some money for loan repayment. It's a radical departure in policy terms for Ghana. In the past the Government practised a needs-driven policy that targeted the most needy communities in order to promote public health. These were communities with a high prevalence of diseases such as guinea worm and were invariably very poor. This policy ensured that those with the least ability to provide for themselves had a right of access to safe water. Through open arm-twisting and naked bullying this policy was reversed in 1995 with the World Bank's insistence on full cost recovery. Water was transformed from a human right into a commodity to be traded on the open market. From that time onwards clean water became available only to those who could pay for it.

‘Sometimes I will go without food so my grandchildren have water. The Government should understand this – water comes before food. Soon we will have to drink air.’

A bucket of water can cost up to a tenth of most people’s daily earnings in Ghana’s cities.
This is Hawa Amadu, a widow in her seventies, who lives with her extended family in one of Accra’s sprawling slums.

Today communities are required to pay 5 to 10 per cent of the capital costs upfront before wells or boreholes are constructed for them - and thereafter bear all the ongoing operation and maintenance costs. Because poor rural communities cannot afford to pay, several especially in the northern and central regions are without safe water. This is either due to the lack  of clean wells and boreholes or because those installed earlier on are in disrepair. The result is that Ghana, which was on the way to eradicating guinea worm, has become the second most endemic country in the world, following only war-torn Sudan. The good news is that a critical mass has formed to contest water privatization.

Over the past year there has been a groundswell of resistance to the privatization agenda of the World Bank and their corporate allies. Nurses and doctors are frustrated and alarmed by the ever-increasing cases of typhoid, cholera and guinea worm. Teachers, students, NGOs, churches, farmers and the unemployed are increasingly unable to cope with escalating water rates. White-collar citizens, among whom are lawyers, accountants and community leaders, have also come together to form the National Coalition Against the Privatization of Water. Support is especially high in cities with large working-class populations. The Trades Union Congress, the largest unionized labour organization in Ghana, is at the forefront of the struggle. Pressure exerted by the Coalition has led to the bid documents being revised twice already. I understand the corporations interested in bidding are currently studying the third draft and are expected to provide comment to the Bank and the Ghanaian Government shortly. Even at this stage, despite the Bank's supposed commitment to full disclosure, bids which ought to be in the public domain are being treated as secret documents. My sense is that the reluctance of the Government and the Bank to make them public will only fuel the growing anger of the population and make the anti-water privatization movement more militant.

Dialogue with the Coalition and a preparedness to engage with the public may be the only avenues left for the Bank and the Government to bow out with dignity. The deal is not likely to be signed in 2003 given the degree of mobilization against it locally and internationally. Elections are also imminent and water will be high on the political agenda. An attempt to force issues could turn ugly. As Al-Hassan Adam of the Teachers and Educational Workers Union puts it: 'Water is our very life. Do they expect us to surrender our lives on a silver platter? They will be fighting for their expected profits; we will be fighting for our very lives.'

Rudolf Amenga-Etego is a farmer by upbringing, a lawyer by profession and an activist for social, political and economic justice by choice. He is the co-ordinator of the National Coalition Against the Privatization of Water.

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Action
National Coalition Against the Privatization of Water
TUC Head office c/o P O Box 2989
Mamprobi Accra, Ghana
Tel: +233-21-666-803/662-568/229181
For further information on Water Privatization from a
Ghanaian perspective check out: www.isodec.org.gh/

International support
In North America, Public Citizen's Water for All campaign
supports the Ghanaian initiative. Go to: www.citizen.org/cmep/Water/
In Britain support comes from Christian Aid - www.christian-aid.org.uk/
Tips on writing protest letters to IMF and World Bank officials
can be found at: www.globalizaction.org/GhanaWater.htm


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