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Uganda

Not only did highly indebted poor country (HIPC) status, conferred in a supposed spirit of munificence by the World Bank and International Monetary Fund (IMF), anger many Ugandans who think of their homeland as more than a “highly indebted poor country” – it provided them an elusive carrot of debt relief and now imposes a bitter medicine of development-through-structural-adjustment, which will ultimately drag Uganda through the mud of water privatization.

The approach to water privatization in Uganda is twofold and represents the primary distinction in Ugandan society – that between urban and rural. Uganda, a landlocked country of 21 million people which has been a baby of IMF structural readjustment programs since 1986, has 88 percent of its population living rurally. Water and sanitation has always been a major issue in Uganda, as the great majority of disease is attributed to poor development of that sector; Health Minister Jim Muhwezi recently said 80 percent of Uganda’s disease burden is a result of poor sanitation. The World Bank’s blanket answer to these complex questions and problems is predictable: privatization.

Privatization is not far away in urban Uganda. The Poverty Reduction Program advocated by the World Bank for Uganda tags a large share of HIPC relief money for the water sector, on the condition that privatization contracts be granted to a foreign operator and that Ugandan authorities take the rather extreme step of involving an “asset holding authority.” The government has already begun to ready the government-owned National Water and Sanitation Company (NWSC) for privatization as part of a regime of “prior actions” required by the World Bank to obtain concomitant loans. The ultimate goal is to achieve full cost-recovery in NWSC before signing a lease agreement with a multinational corporation, and Ondeo, a subsidiary of French corporate water giant Suez, has already been hired to take over tariff collection for NWSC. (Full-cost recovery connotes that the consumer pays the full cost of operation and maintenance, without public subsidy.) “Prior actions” have included raising tariffs, cutting off customers who cannot pay, and encouraging sub-contractors to operate public taps and sell water in poor neighborhoods. Cutoffs have resulted in poor households having to draw water from polluted urban rivers, contributing to, not mitigating, the incidence of disease. The dependence on private sellers to provide the poor with basic water rations, in place of the commitment to extend water infrastructure to poor neighborhoods, has directly resulted in the inflated and exorbitant tariffs for the poor. In Katanga, a Kampala slum, 20 liters of water sells for between Shs 50 and 200, while the most affluent of Kampala pay the official NWSC rate of Shs 14.

Privatization in the rural context has been initiated under the World Bank term Private Sector Participation (PSP). PSP in Uganda consists of the implementation of many village-level water supply projects through private contracting throughout the country. This program, between 1997 and 2000, increased those with access to safe water from 40 to 50 percent. However, the ostensible success indicated by these figures is misleading. Most projects were undertaken without any emphasis on sustainability; no provision was made for community participation and/or training in repairs. Communities did not get consulted or often even informed about water projects meant to serve them. Only one in 15 communities evaluated by WaterAid-Uganda could actually identify the operator responsible for construction in their own village. According to WaterAid, contractors were interested only in making money and moving on, not setting up mechanisms for the sustainable development of the village-level water sector. If the government does not, in the future, insert itself to maintain equipment or teach sustainability, any gains made in water access will evaporate.

As with most privatization schemes, PSP in Uganda also left the most destitute in the country without access to safe water. Because PSP requires an often substantial two - 10 percent investment from the village to initiate a project, the poorest villages are not able to benefit from the construction of clean water sources. Contractors simply move on to the next village which is able to raise the necessary capital.

Privatization and PSP in Uganda are the next steps in an unwieldy, prosaic, and damaging World Bank/IMF global policy of public divestiture from the water sector. In Uganda, as in the rest of the world, the consequences of this policy have been counterproductive. The poor pay the highest tariffs for the worst service, and poorest of the poor often get no service at all.

In the News:
January 7: Who is to Blame for the Failed World Bank Sponsored Projects?

2004
April 23: Water will not be privatised

2003
September 18: Thirsty for cheaper water
August 20: Gov't pledges to combat disease through improved sanitation
July 16: National Water and Sewerage Corporation to receive prepaid water bills

    » cmep | Water | cmep Water | reports | uganda


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