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Is Cash-Strapped Portugal Using Austerity as an Excuse to Privatise Water?


Water privatisation in Portugal. Image: WeHaveKaosinTheGarden. Used with permission

Water privatisation is once again a topic of debate in Portugal. The subject was recently discussed in the Portuguese parliament, where the leader of the The Greens party, Heloisa Apolonia, accused the government of “withdrawing its promises on the water sector”.

Minister of Environment Jorge Moreira da Silva has assured that authorities will not privatise Águas de Portugal (ADP), the national company that manages water supply in the country. However, the minister is supporting the restructuring of the treatment system and water supply — which includes raising tariffs in the coastal municipalities to reduce prices in the interior of the country — to ensure its “economic and financial sustainability.”

Local councilors fear that this restructuring is a step to privatise this essential commodity in the same way the country's urban waste management company fell into private hands in 2014. The country's high levels of debt put it at the mercy of foreign capital, making it more vulnerable to privatisation.

But the minister has rejected this theory, saying that the reform implemented avoids this scenario. Moreira da Silva says the plan will lead to greater equity in the cost of water across the country.

Latest news – Aguas de Portugal: In the end, the price of water will rise around the country

The restructuring was predicted to bring water prices down in the country's interior and up everywhere else, but in fact households everywhere will be paying more. Nuno Cardoso, ex-president of the local water company Águas do Douro e Paiva, called the idea that families would be paying less a “fallacy“.

The minister's explanations did not convince Twitter user Artur Amorim, who believed that privatising the water in Portugal is part of the political agenda:

WATER / URGENT = DO NOT BELIEVE IN THE PORTUGUESE POLITICIANS! Privatising all water in Portugal is on their agenda.

Talk about privatasing Portugal's water services has been around at least since the country entered economic crisis several years ago and received a rescue package for its public debt in 2011 from the so-called toika — the International Monetary Fund, the European Commission and the European Central Bank.

In 2012, in an article published by the Portuguese Business newspaper Jornal de Negocios, then-Minister of the Environment Assunção Cristas referred to the troika‘s desire to make the company Aguas de Portugal private:

A privatização da Águas de Portugal foi já abordada várias vezes com a troika, explicou Assunção Cristas aos deputados. “Dissemos que precisávamos de tempo e temos 2012 para fazer uma reestruturação do grupo ADP e só depois disso será conhecido o modelo de privatização”, concretizou, remetendo a concretização do processo para 2013.

The privatisation of Aguas de Portugal has already been addressed several times with the troika, said Assunção Cristas to the members of parliament. “We replied we needed time and we have the year 2012 to perform a restructuring of the Águas de Portugal group and only after that the privatisation model will be made known,” she said, leaving the completion of the process for 2013.

In 2013, the same minister kept her promise and went to parliament to defend “the sale of waste management public enterprises and the sub-concession to private companies of water supply systems”:

Anti-privatisation activists created the Facebook page “Movement for Water – Put privatisation of water to a referendum” on social networks in response. The platform appears to be less active nowadays, but its posts still ring true. In 2013, one of the posts said that “no private company or multinational will venture into the water business if it does not generate profits by the millions” and wondered “what is the government interest in privatising this public asset that is, above all, a human right?”

Ricardo Carvalho responded at the time with the following comment:

A água potável é fonte de riqueza apetecível às empresas privadas. Se não são mais rentáveis é porque não sabem gerir o serviço. Deve ser dada a devida importância aos Sistemas de Informação Geográfico assim como à gestão com o intuito de minimizar as perdas. Também a pressão existente na rede e contadores qualificados fazem com que o negócio da água seja rentável. Não é preciso privatizar mas sim ser eficiente.

Drinking water is a source of wealth attractive to private companies. If it is no longer profitable, it is because [the government] does not know how to manage the service. It must be given its due importance in terms of Geographic Information Systems as well as management in order to minimise losses. Also the pressure on the network and qualified accountants make the water business profitable. No need to privatise, but to be efficient.

It's true that there is lots of money to be made in the water business. The commercial and strategic value of water — dubbed “blue gold”, a spin on the term “black gold” for oil — has not escaped the interest of multinationals. Nestlé, the largest food producer in the world, leads the bottled water market. The company's president argues that “water is a food and as any food must have a market value.”

But privatisation has given rise to social tensions in various regions of the world. The documentary “Blue Gold – World War for Water” shows the “thirst to privatise the water” by the big multinationals and the involvement of the World Bank.

‘Privatise the sea and the sky, privatise water and air’

report released ​​in 2013 by a German TV station showed how the European Union (EU) has initiated a project of privatisation of water across Europe, including in some regions of Portugal. These regions served as the precursors of this “secret” plan:

In 2014, during a celebration of the European Citizens’ Initiative “Water and sanitation are human rights,” The Greens party euro-deputy Bas Eickhout criticized the European Commission together with the troika for demanding the privatisation of Aguas de Portugal:

And on water privatisation, officially it's not the commission's policy yet […] however, it's true if you then look at the troika and if you look at the memorandum of understanding between, for example, the troika and Portugal, there's nothing on it. But then if you read the progress reports, the commission as part of the troika is asking to further privatise Aguas de Portugal, so in the troika the commission is still pushing for privatisation. So if it is really a human right and if we really are serious to the citizens and to this initiative, we should start acting […]

The parliament of Greece is preparing to introduce legislation that attempts to fit water as a human right in its constitution. If it succeeds, the country will become a pioneer in Europe with regard to the conservation of an essential commodity and its universal access.

The Greek initiative set the tone for the movement Right2Water, which gathered several European organizations in order to get two million signatures for the EU to start the debate and create the appropriate legislation at the European level. This has not happened yet, but this bill will again be discussed in Parliament soon, according to the portal InfosGrécia .

The privatization push continues at a breakneck pace in Portugal. Aguas de Portugal, which is partially owned by Energias de Portugal (the country's energy supplier, which was privatised in 2011), could generate the interest of Nestlé.

On Facebook, Hélio Moreira quoted a famous reflection of Portuguese writer and Nobel Prize in Literature winner José Saramago, who in an outburst wrote a record about privatisation in his Lanzarote Notebooks – Daily III (pages 147 and 148):

Privatize-se tudo, privatize-se o mar e o céu, privatize-se a água e o ar, privatize-se a justiça e a lei, privatize-se a nuvem que passa, privatize-se o sonho, sobretudo se for diurno e de olhos abertos. E finalmente, para florão e remate de tanto privatizar, privatizem-se os Estados, entregue-se por uma vez a exploração deles a empresas privadas, mediante concurso internacional. Aí se encontra a salvação do mundo… e, já agora, privatize-se também a p*** que os pariu a todos.

Privatise it all, privatise the sea and the sky, privatise water and air, privatise justice and the law, privatise the passing cloud, privatise the dream, especially if it is daytime and with open-eyed. And finally, after so much privatisation, privatise governments, surrender once and for all their exploitation to private companies through an international share offering. Therein lies the salvation of the world … and, while you're at it, privatise the whore mothers who gave birth to you.

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