Inter Press Service
16 April, 2012
“According to CAI, funding the privatization of water hurts the world’s poorest and can also have negative effects on water access and human rights.”
People in many developing countries often lack access to clean water, but the approach to remedy this problem has shifted in recent years to rely more on the private sector. Yet, as this new report and several other watchdog groups have shown, the change has been more harmful than helpful.
Corporate Accountability International, the U.S.-based non-governmental organization that published the report, has called on the World Bank to stop funding the private water sector and start redirecting its money to public and democratically accountable institutions.
The World Bank's private sector arm, the International Finance Corporation (IFC), has spent 1.4 billion dollars on private water corporations since 1993, according to the report.
As of January 2013, that investment will increase to 1 billion dollars per year. The report also says that the IFC is attracting 14 to 18 dollars of follow-up private investment for every 1 dollar it directly invests.
This money helps explain why the World Bank and the IFC continue to fund private water corporations, even though roughly one third of all private water contracts signed between 2000 and 2010 have failed or are in distress – four times the failure rate of comparable infrastructure projects in the electric and transportation sectors, according to CAI.
"A tremendous failure"