Committee for the Abolition of Illegitimate Debt

WATER is a typical example of common good. There is no need to illustrate the importance of water: Water is life.

All civilisations agreed about sacristy of water but with the current liberal globalization which aim and operate to transform everything to a commodity, water is no longer considered as a public common good but like any other commodity, speculated by few multinationals such as Veolia and Suez.

The MENA region is a large zone extending from Morocco in northwest Africa to Iran in southwest Asia. It generally includes all Middle East Asian and North African countries, as well as Iran. Such a designation of this area was adopted by the World Bank World Bank
WB The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

, copying it from the multinationals who consider this area as a “market unit” (in terms of consumption and investment). This division is justified by the cultural, religious, linguistic and historical similarities/unity shared by the majority of the people of this region and the lifestyle and consumption levels of their population.
However, the Middle East and North Africa (MENA) region is of great political and economic diversity that includes both oil-rich Gulf economies and resource-poor countries compared to their population, such as Yemen Egypt and Morocco. The population of the MENA region is about 6% of the global population and is almost equivalent to the population of the European Union.

Oil is the main natural resource that the region has with 70% of the world reserves with 797 billion barrels (8 of the 12 countries of OPEC OPEC
Organization of Petroleum-Exporting Countries OPEP is a group of 11 DC which produce petroleum: Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, Venezuela. These 11 countries represent 41% of oil-production in the world and own more than 75% of known reserves. Founded in September 1960and based in Vienna (Austria), OPEC is in charge of co-ordinating and unifying the petroleum-related policies of its members, with the aim of guaranteeing them all stable revenues. To this end, production is organized on a quota system. Each country, represented by its Minister of Energy and Petroleum, takes a turn in running the organization. Since 1^st July 2002, the Venezuelan Alvaro Silva-Calderon is the Secretary General of OPEC.

OPEC : http://www.opec.org/opec_web/en/ are in the MENA region).

On the environmental front, the region is characterized by an arid or semi-arid climate and one of the lowest rates of availability of water in the world. 15 of the 20 countries in the world living below the poverty line in water (water stress situation: less than 1 000 m3 per year per person), are in the MENA region.

Water is scarce and will become even more. Climate change, population growth, changes in consumption habits and the pursued development model - all exacerbate local water shortages. All the reports by experts and international institutions including the World Bank have agreed on the criticality of the situation which will further worsen in the next 20 years depriving more and more people of water of decent quantity and quality.

This worsening situation is principally due to:

1. “Development” model/s followed by the countries of the region characterized by export-oriented agricultural crops consuming large quantity of water, tourism and liberalization of water services promoted and encouraged by International Financial Institutions (IFIs) mainly the World Bank which threaten the right to access of water for most of the MENA citizens.

2. Climate change mainly due to emissions of green house gases from the plants of major industrial countries of the northern countries: USA, Europe and also China, India and Russia!

The purpose of this article is to focus on limited water resources in this region. The climate change that threaten the region for the next 50 years and its impact on water resources. Finally we will try to draw a status of more than ten years of liberal reforms conducted in this region.

Water resources in MENA

The countries of the MENA region are home to 6 percent of the global population but have less than 1 percent of the of the planet’s renewable freshwater reserves. These water resources have experienced a significant decline in recent years estimated to one third of its level in 1960 and will be halved by 2050 if current consumption trends continue. These estimates are based on a constant rainfall and ignore predictable reductions in rainfall due to climate change that can reach 40% (ref IPCC).
The Mena region is the world poorest as far as renewable water is concerned; many countries such as Yemen, Jordan, Libya, Algeria, and Palestine are already experiencing a situation of acute shortage (less than 500m3/an/habitant). The case of Saudi Arabia is even more serious with more than 75% of resources are non-renewable fossil water. The desalination of sea water meets only 5% of its demands, despite the large investment it has committed in desalination where it is considered a pioneer in the region!
 
With an average of only 1400 cubic meters of renewable water resources per capita and per year in 2006, the MENA region is far below the world average of 8500 against 36 500 m3 in Oceania 23 000 m3 in South America.

Mena water demand is growing more and more

On the other hand with the decline of the quantity of available water, the demand is continuously growing due to the demographic growth and especially because of the development model pursued by Mena countries which doesn’t bother about the limited water resources that they have.

The MENA countries consume nearly 80% of the water they have, in stark contrast with regions such as Latin America, the Caribbean and sub-Saharan Africa, where countries consume only about 2% of volume available.

The agricultural sector is the largest consumer of water (85% as regional average with extremes such as Syria and Yemen with 90% and 95% respectively).

The expected Increase of water scarcity due to climate change and growing demand will exacerbate existing conflicts and cause new ones since 80% of surface resources in MENA region are shared by more than two countries.

Water in the Palestinian occupied territories

Almost 30 of 50 violent incidents related to the water globally in the last 50 years, have been between Israel and one of his neighbours.

For its water resources, Israel depends on:

 Jordan (river border that feeds the Sea of Galilee, the four rivers which form the Jordan river basin; only one has its source in Israel).
 Syrian Golan Heights (true regional water tower occupied by Israel since 1967);
 Groundwater in the West Bank, where the drilling of new wells has been forbidden to Palestinians who have since then only 10% of resources water, 90% being captured by the Israelis.

Already in 1989, 90% of the lands occupied by Israeli settlers in the West Bank Gaza are irrigated against only 2.5% of land belonging to Palestinian farmers. 100% of Israeli settlements are connected to water and sanitation, while that percentage barely exceeds 50 among Palestinians.
The water will probably be one of the severe complications to manage in this conflict and will be as important as the issues of settlements, the return of Refugees or the situation of Jerusalem...

Climate Change in the MENA region and its impact on water resources

Historically speaking, the Earth’s climate has changed several times. Climate change is due to various causes, both natural and human. In recent decades, the anthropogenic causes of climate change have been increasing, mainly due to activities involving fossil fuels and deforestation. Such activities result in emissions of carbon dioxide and other gases that cause the greenhouse effect in the atmosphere; global warming have adverse effects on the Earth’s climate.

In the past, water management was based on the assumption that weather conditions would remain unchanged. However, nowadays there is growing evidence that climate change is having a major impact on the availability of fresh water, access to water and its quality. It is estimated that around 2020, between 75 and 250 million people will face an increase in water stress due to climatic changes. The Middle East and North Africa (MENA) region is particularly vulnerable to the impacts of climate change, in addition to the water shortages already presented.

According to IPCC 2007, climate change in Mena region will make the weather hotter and drier; the increase in annual average temperature will reach 2 to 2.5 °C by 2100.

This increase of temperature will augment evapo-transpiration reducing infiltration and aquifers recharge.
Climate change will have negative impact on the quality of groundwater especially in coastal zones.
Sea level is expected to rise in many coastal towns. Bahrain risks losing 5% -10% of the total area of the country.
Because of climate change, annual average rate of precipitation will significantly decrease in Mena region reaching between 10 - 20%. In Morocco, Saudi Arabia, Yemen and Emirates the decrease is expected to be 30 -40 %.

Warmer water will have also impact on biodiversity with higher salinity of surface especially in lakes, reservoirs and dams.

Nevertheless; while this region is among those most vulnerable to climate change and will have the most disastrous consequences of such a special emphasis on water resources and food security, it is the least polluting in the world with only 4.5% of GHG emission primarily responsible for climate change. 84% of these GHG emissions are linked to oil activities. The concept of ecological debt becomes very pertinent in this case especially when those poor MENA countries are financially indebted to the developed countries and the debt service Debt service The sum of the interests and the amortization of the capital borrowed. continues to absorb much of their budgets. (Ref: “Ecological debt: who owes whom?” CADTM France-2003)

The liberal answer to MENA water crisis

Faced with this serious crisis of water resources in the MENA region that will worsen in the coming years, liberal actors led by the World Bank promoted and offered some liberal answers oriented to a single “magic solution” that can save this region from the disaster; their recipe is that of a privatization of water services and sanitation which is also known as public-private-partnership (3Ps).

The magic solution advocated by the World Bank is based on liberal postulates that have never been shown such as:

 "Water is a scarce and it will be scarcer in the coming years and only the market knows how to manage the scarcity”!!
 Private management is more efficient than public management.
 The public administration is weak and bureaucratic.
 ...

Clearly the World Bank favours privatisation as the means by which the problems of the water sector in MENA can be addressed.
“The Bank’s strategy in MENA is to support private-public partnerships which will gradually increase the role of the private sector in service delivery management and investment….It consists first in the introduction of the private sector in the operation and management of the utilities or commercialisation of the operations.” [1]
“The Bank also continues to encourage Governments to explore opportunities for local and national public-private-partnerships in the provision of water supply and sanitation services.”
(World Bank Recommendations WATER RESOURCE MANAGEMENT IN MENA – September 2008)

Fortunately, there has been little privatisation in the region in terms of the award of concession contracts comparing to others parts of world. Only Morocco has undertaken substantial privatisation with the award of three long term concessions. Elsewhere privatisation has been limited to short term management contracts (Amman, Bethlehem and Hebron, Gaza) or is in the form of BOT or IWWP contracts or turnkey construction projects.

Some municipalities have successfully provided water under public ownership (for example, Jerusalem, Tunisia, and Iran) and some have resisted privatisation (Egypt).

Morocco is shown as best example by WB; it embraced privatisation of the water sector far more than other countries in the region having signed three major combined water and electricity concessions in Casablanca, Rabat and Tangiers. Three more are planned in Fez, Marrakech and Agadir. [2]

The experience of over-privatization of water services implemented by Morocco governments in the last decade shows the total failure of this approach in meeting the needs of populations in water and sanitation

Experiences of the Moroccan water services privatization

In the nineties several public agencies which were in charge of water and electricity distribution faced very difficult financial situations with high debt due to the appalling management of technical resources combined with corruption and bureaucracy. Under the pressures from the IMF IMF
International Monetary Fund Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org and WB, four concessions appeared successively in 1997 (Lydec-Suez in Casablanca), 1998 (Redal with a Luso-Spanish consortium, taken by Veolia in 2003 in Rabat) and 2002 (Amendis-Veolia in Tangier and Tetouan).

The distribution of drinking water by delegated private operators increased considerably:

Within 5 years and without any appraisal by the Moroccan people, 4 of the largest towns are provided water by private companies which constitute a turnover estimated at 8 billion dirhams which is between 2 to 2.5 per cent of GDP GDP
Gross Domestic Product Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another. .
One quarter of the total population of Morocco is now provided by Veolia and Suez in one of the most important cities (more than 3 million people in Casablanca to Suez, 2 million people in Rabat-Sale and 1.2 million people in Tangier and Tetouan for Veolia).

Of course government officials and liberal defender, and even new media people “New guard dogs” as expressed by Serge Halimi preach the merits of this operation on many levels:

 Technical competence
 Financial returns
 Universal access and connectivity for drinking water
 Investment possibilities
 Increasing job Opportunities

Few years were enough for Moroccan people to realize the promised “advantages”. After some exterior face-paints such as decorating and organizing agencies and intensifying advertising campaigns, the urban population discovered the truth when prices and water bills in those cities increase rapidly. For example, Veolia, the first thing that they did in Tetouan (in the north) was to align the prices with Tangier which was higher.

The soaring price of the water bill and power in large measure led to the movement of large demonstration against the high cost of living, experienced throughout Morocco since late 2006.

Several sit-ins were sometimes spontaneously organized before Veolia & Suez with slogans against both multinationals asking them to leave the country.

In addition, and contrary to what was announced at the beginning, social water connections have declined significantly because of the expensive cost of these connections especially in poor neighbourhoods which are unfortunately on the outskirts of the cities. This cost has been multiplied by 6 in cities run by Veolia and Suez to reach 18 000 dirhams which is almost 9 times the minimum wage.

In the case of Lydec-Suez, after 10 years and under the pressure of Casablanca’s population a commission of inquiry was formed in March, 2008. The report prepared by the commission and despite all the pressures exercised by the multinational, highlighted many contract violations such as:

 Deprived many people of their right of access to water, since the number of beneficiaries did not exceed 11 465 during the first five years instead of 45 miles stipulated in the contract
 The investigation concluded that an investment gap (between 1997 to 2006) to 2.8 billion dirhams compared with a contractual investment.
Convert profits convincing technical services in the form of exaggerated exceeded 775 million dirhams through a special company to “Lydec Service” created specifically for this purpose
 Distribution of profits estimated at 460 million dirhams during the years 2003-2005, without respecting the requirements of the contract which stipulates that the distribution of Genet will be only 10 years later.
 Suez-Lydec has not fulfilled its commitments vis-à-vis 1000 workers! Many of them were forced to leave the company (start “voluntary” or unfair dismissal).

Therefore, Morocco has privatized not only distribution of drinking water and sanitations but Water Sources also and even irrigation services.

 Privatization of water sources: the case of “BENSMIM”

BENSMIM is a small village located at 6 km from Azro town, about 250 kilometres from Rabat with a population of about 3000 people live mainly on farming and livestock breeding (5000 heads) that are activities rely mainly on water.
In the last years, and because of climate changes, the region has seen significant reductions in the flow of the source of Bensmim. This has pushed populations to organize themselves to face this shortage, dividing lands to two parts which are cultivated in alternative years.

In 2001 a French investor presented himself in the village claiming that he had all necessary permits to build bottling plant water in the village of “Bensmim” with a company by the name of «Euro-Africaine des eaux».

He claimed that he bought from the state the right to use this source for 30 years (the State owns 60 % while the rest is owned by Bensmim habitants.

However villagers sensing the danger of this process on the health and the existence of their families, struggled against this project through protest marches and stops. Villagers have vigorously defended their water source and fully understood the risk of such privatization. The persistence of the population of Bensmim in the heart of the credit definition of fair battle at the local level, national and international also had a great merit in reopening the discussion about the ownership of water and the legality of privatization and who has the right to take such decisions (by the authorities, elected, Senate ..) that are dealing with the destiny of the entire population and future generations.

From the information available, the company intends to continue to draw 100 million litres of water per year in suits based on statistics about the stock source back to the seventies, ignoring the apparent lack defined by this stock in the recent period, estimated at 30 % for the period between 1986 and 2000 to reach effluent today between 10 and 20 litres per second.

Privatization of agriculture irrigation services: the case of “Sebt alguerdanne”

In an unprecedented first in Morocco, irrigation services were awarded to a private company called Amensouss for 30 years in the area around the province of Taroudant in the south. And this project includes construction and exploitation of water installations for irrigation of 10 thousand hectares by establishing underground pipelines. A principal pipeline with 90 km length will link this region to two dams “Aoulouse” (108 Mm3) and “Mokhtar soussi” (50 Mm3) adding to 345 km of secondary piping for irrigation which will provide a total volume of water, estimated at 45 million cubic meters per year.

The company benefitting from this concession is Amenssous which consists of 4 companies including ONA (a company of the Royal family)
The financial cost of this project is 987 million dirhams The State is itself supported by the Hassan II Fund constituted by the privatization incomes amounting to 237.5 million dirhams, in addition to the loan at 1 per cent for 20 years by the same fund!!! While the contribution of the Amenssous company is 432 million dirhams, the remaining amount will be raised by the peasants deemed to benefit from the project at a connection price of 8000 dirhams (800 Euros) per hectare.

Peasants of this region will find themselves forced to pay 1.48 dirham per cubic meter instead of 0.5 dirham payed by their counterparts in other regions of Morocco.

Conclusion

The experience of over-privatization of water services adopted by Morocco governments in the last decade shows the total failure of this approach in meeting the needs of populations in water and sanitation.

The Mena region is the world poorest as far as renewable water is concerned and it is one of the most vulnerable regions to climate change. This situation can not be improved without achieving deep reforms of water policy in MENA by linking political and economic choices (tourism, patterns of farming, industry) to the available volume of water resources. Only public services with a popular control are able to achieve these reforms and arbitrate between the different areas agriculture, industrial, drinking water, recreation and tourism ... and not leave the market to decide according to the most telling...!

Jawad Moustakbal, jawad.attac at gmail.com
(Member of ATTAC/CADTM Morocco)
Casablanca Morocco – Nov 2009

References

“Eau = source de vie, pas de profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders.  » cahier Oxfam JUIN 2003 numéro 1
WATER DEMAND MANAGEMENT - SECURITY FOR THE MENA REGION Dr. Hani Abu Qdais Seventh International Water Technology Conference Egypt 1-3 April 2003

“Aquatic Resources in Morocco between the hammer of limited resources and the anvil of the market logic” Jawad Moustakbal – ESU- Sherbrook Germany - Jul 2008

« Obtenir le meilleur parti des ressources rares : Une meilleure gouvernance pour une meilleure gestion de l’eau au Moyen-Orient et en Afrique du Nord » Rapport de la banque mondiale sur le développement Région MENA 2007

“the privatization of water in Morocco” by Mehdi Lahlou January 2008 president of ACME MAROC (Global Water Contract Morocco)

water and the city, Morocco: a public service in the transformation professor Béatrice ALLAIN-ELMANSOURI

A special file for “ASSABAH” newspaper entitled “sins of the Kingdom of Great John Bierarmono chairman of LYDEC-Suez” on the 12-13 January 2008

« LE JUSTE ÉQUILIBRE : population et insuffisance des ressources en eau au Moyen-Orient et en Afrique du Nord » par Farzaneh Roudi-Fahimi, Liz Creel et Roger-Mark De Souza Novembre 2002, Population Reference Bureau

« Gestion de la demande en Eau au Moyen Orient et en Afrique du Nord: Enjeux et perspectives » Dr Hammou Laamrani1, Dr Lamia El Fattal2 & Dr Eglal Rached3 Centre de Recherches pour le Développement International (CRDI) – 2008

Public Private Partnerships (PPP) in the Middle East and North Africa (MENA) Marwa Al-Nasa’a, July 2007

“Competition over resources, rural poverty and agrarian policies in MENA” 10^th Mediterranean Research meeting 25-28 March 2009

« Right to Water in the Arab Occupied Territories » Report of League of Arab States Department of Environment, Housing and Sustainable Development

“ WATER AND ADAPTATION TO CLIMATE CHANGE IN THE ARAB REGION” Dr. I. Jnad, Dr. M. Sibai Water Resources Department, ACSAD - 2009