blame ADB for water privatization
By Rhodina Villanueva
TODAY and ABS-CBN
The Asian Development Bank (ADB) should share in taking
responsibility for the impact of the failed water privatization
in Metro Manila.
According to the Freedom from Debt Coalition (FDC), the
ADB, together with the International Monetary Fund and
the World Bank, has been very active in pushing the government
to pursue the privatization of water utilities.
" In the ADB country-operation strategy for the
Philippines in 1993, ADB called for greater involvement
of the private sector, especially in the water sector,"
said Jolette Fajardo of the FDC-Water Team.
He noted that the ADB, as one of the lenders of Maynilad
Water Services Inc., helped pushed government to agree
to giving in to Maynilad’s demand for a rate increase
to prop up the ailing company.
" Because of the privatization policy, Metro Manila
residents have been subjected to steep water- rate increases
with no accompanying service improvements. The policy
also succeeded in taking away the provisioning of water
from the realm of government services to a sphere which
treats water as a source of profit," Fajardo said.
He added that with water in private hands, the people
have lost their power to demand better services because
of the private corporation’s lack of accountability to
" They cannot even participate in the ongoing legal
dispute between the Metropolitan Waterworks and Sewerage
System [MWSS] and Maynilad because of lack of ‘legal personality’
to intervene in a "private contract' between these
companies," Fajardo said.
On December 9, 2002, Maynilad filed a notice of termination
of its services with MWSS, alleging that the government
has made it difficult for it to perform its service obligations.
According to Maynilad, MWSS violated provisions of the
In this light, the FDC reiterated its stand that privatization
will not solve government inefficiency and corruption.
"Even privatization proponents admit that strong
and good governance is a requisite for privatization to
work. The solution is to reform government, not turn its
back from its responsibility to its people."
Fajardo said, "Pursuing the privatization policy
espoused by multilateral financial institutions like the
ADB will not bring water for all."
He added that "by pushing government to adhere to
a policy treating water as an economic good provided by
the private sector, the ADB has succeeded in taking an
essential service away from effective government control,
making water a source of profit available to only those
who can afford it."