The Privatization of Water Systems in Cochabamba, Bolivia
Submitting to increasing pressure from the World Bank in 1999, the Bolivian government privatized the public water system of its third largest city, Cochabamba. In response to the skyrocketing price of water, in February and March 2000, protests became violent to the extent that Bolivia was consequently placed under martial law. Yet, despite their obvious grievances, the Bolivian people continued to see their bills triple or even quadruple, only weeks after Aguas del Tunari of London-based multinational International Water Ltd. and American Bechtel Enterprise Holdings, took over the city’s water system. The governor of Cochabamba failed to persuade the central government to cancel the contract with del Tunari, and before long, then President Banzer prohibited gatherings of more than four people and severely limited freedom of the press. According to Jim Shultz, the Bolivia-based director of the Democracy Center, water rates soared by as much as 300 percent, while del Tunari maintained that the increases were no more than 35 percent. Yet, for thousands of families, the hiking rate of water diminished sometimes half of their monthly incomes; for a developing nation such as Bolivia, also the third poorest country in South America, this was a complete calamity. At long last, on April 10 the protesters were heard and President Banzer announced the termination of its contract, restoring the people’s water rights.
