Water sector privatization looms, NGOs warn of risks

Water sector privatization looms, NGOs warn of risks

Muninggar Sri Saraswati, Jakarta

Less than three months after the House of Representatives
approved the water bill amid public outcry, the government has
talked about a plan to privatize state-run regional water
companies.

After a meeting with House legislators in mid-May,
director-general of city and village planning at the Ministry of
Settlement and Regional Infrastructure Patana Rantetoding
disclosed the government's plan "to revive over 300 ailing
regional water companies across the country, and to provide clean
water".

He announced that several international financial institutions
and foreign governments had pledged to fund the program.

Among them are the Asian Development Bank (ADB), the World
Bank and the governments of France, Australia, Spain, Italy and
the Netherlands, Patana said.

"We will fund the program from the state budget, and loans or
grants from foreign (institutions and countries). We also welcome
investors, both foreign and local," he said.

Patana said the government would be able to repay the loan
within 20 years, thanks to the huge market in the country.

The government, he said, has decided to borrow the money from
foreign institutions and governments, some Rp 4 trillion (around
US$434,000), to finance the program.

The program follows Indonesia's commitment to the United
Nation's 2000 Millennium Development Goals (MDG) that require
participating countries to double people's access to clean water
by 2015.

In 2000, only 42 million residents, or over 20 percent of the
country's population of 200 million, had access to clean water,
Patana said.

Under the program, the government expects the figure to rise
to 150 million, or 60 percent of the population, and reach 80
percent of residents in urban areas and 40 percent of people in
rural areas by 2015.

The government blames the regional water companies' huge debt
burden for their failure to provide clean water to people.

"Of some 300 state-owned water companies in the country, only
9 percent are considered healthy," Patana said.

Non-governmental organization activists consider the
government's plan a clear confirmation of their suspicion, long
before the bill was passed by the House, of the possible
privatization of water management. The activists had warned that
privatization would only benefit a few giant foreign water
companies.

"It's clear now. The privatization of water management has
affected the country," said Heine Nababan, a member of the
Coalition of People's Right to Water, which was among staunch
critics of the water resource bill.

He said privatization was not the only way to provide people
with access to clean and affordable water, as private companies
would turn water into a profit-oriented business, therefore
blocking the poor's access to clean water.

Heine pointed to cases in Argentina, Bolivia, Ecuador, Panama
and South Africa, where people took to the streets to protest the
commercialization of water. Some of the protests turned violent.

Assisted by the Jakarta Legal Aid Institute, the coalition is
set to file a judicial review with the Constitutional Court
against the new law, saying it violates the Constitution.

"We hope the Constitutional Court justices understand the
consequence of the privatization of water management. Many people
will suffer as most of them, including farmers, cannot afford to
buy water, the basic necessity of human beings," he said.