Water privatization in the context of Water privatisation in England and Wales

Privatization (rendered privatisation in British English) can mean several different things, most commonly referring to transitioning something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when a heavily regulated private company or industry becomes less regulated. Government functions and services may also be privatised (which may also be known as "franchising" or "out-sourcing"); in this case, private entities are tasked with the implementation of government programs or performance of government services that had previously been the purview of state-run agencies. Some examples include revenue collection, law enforcement, water supply, and prison management.

Another definition is that privatization is the sale of a state-owned enterprise or municipally owned corporation to private investors; in this case shares may be traded in the public market for the first time, or for the first time since an enterprise's previous nationalization. This type of privatization can include the demutualization of a mutual organization, cooperative, or public-private partnership in order to form a joint-stock company.

The Cochabamba Water War, also known as the Bolivian Water War, was a series of protests that took place in Cochabamba, Bolivia's fourth largest city, between December 1999 and April 2000 in response to the privatization of the city's municipal water supply company SEMAPA. The wave of demonstrations and police violence was described as a public uprising against water prices.

The tensions erupted when a new firm, Aguas del Tunari (a joint venture involving Bechtel), was required to invest in construction of a long-envisioned dam (a priority of mayor Manfred Reyes Villa), so they had drastically raised water rates. Protests, largely organized through the Coordinadora (Coalition in Defense of Water and Life), a community coalition, erupted in January, February, and April 2000, culminating in tens of thousands marching downtown and battling police. One civilian was killed. On 10 April 2000, the national government reached an agreement with the Coordinadora to reverse the privatization. A complaint filed by foreign investors was resolved by agreement in February 2001.

Water privatization in Guayaquil began with the decision taken in 1995 to privatize drinking water supply and sewerage in Guayaquil, the largest city and economic capital of Ecuador, through a concession contract. In preparation for privatization, the previously separate water and sewer utilities were merged into a single utility in 1996. The new utility began a modernization process and began to improve its performance. In parallel, the international bidding for the concession was prepared by Banque Paribas as the international advisor and was supported by the Inter-American Development Bank. The latter made a loan that was signed in October 1997 conditional upon the decision to award a concession. The 30-year concession agreement between the city government and the private company Interagua was signed in 2001. The contract was "poor-friendly", requiring the private company to keep tariffs constant for the first five years and to connect new users in poor areas "at no cost". At the same time, the former municipal water and sewer utility ECAPAG became the regulatory agency for the new private utility. Interagua is a consortium led by the Spanish company Proactiva Medio Ambiente, which in turn is supported by the Spanish construction firm FCC and the French water company Veolia Environnement. In 2012 the regulator ECAPAG was transformed into the Municipal Public Drinking Water and Sanitation Company of Guayaquil in what may be a first step towards the municipalization of the concession.

Private sector participation (also called "water privatization" or "public-private partnerships", PPP) in water supply and sanitation in Colombia has been more stable and successful than in some other Latin American countries such as Argentina or Bolivia. According to the World Bank, between 1996 and 2007, more than 40 water and sanitation service provision contracts have been awarded to private or mixed companies in Colombia, serving a combined population of 7.3 million or more than 20% of the urban population. According to the Colombian water regulator, there were even more public-private partnerships for water and sanitation in Colombia in 2004: 125 private and 48 mixed public-private water companies, including large, medium and small companies. Most of the contracts were awarded in poor municipalities with highly deteriorated infrastructure. They relied mainly on public funding, complemented by limited private funding. The design was based on the central government providing grants in the start-up years to rehabilitate deteriorated systems and to expand access, while the contracting municipal governments also made budgetary transfers on an annual basis to complement revenues. Colombia thus departed from the standard concession approach, which requires private concessionaires to finance investments with their own resources.

According to the World Bank, the key to success of private sector participation in the Colombian water sector has been the development of homegrown solutions, and, at times, skillfully adapting models used elsewhere to the particular circumstances and culture of Colombia.

Water privatization in Morocco goes back to the times of the French Protectorate when most water supply systems were run under a private concession. After independence the private utility was nationalized, but in the mid-1990s the Moroccan government privatized water and sewer services again, alongside electricity distribution, in four cities. The privatization process began with the award of the Casablanca concession to Lyonnaise des Eaux (now SUEZ) in 1997, followed by the award of a concession for the capital Rabat in 1998 and the award of another concession for Tangiers and Tetouan to Veolia Environnement. In 2009 private companies provided water and sanitation services to 38% of the urban population of the country.

The privatization of water and sanitation services in Argentina between 1991 and 1999 under the government of Carlos Menem was part of one of the world's largest privatization programs. Water and sanitation concessions with the private sector were signed in 28% of the country's municipalities, covering 60% of the population.

The highest profile concession was signed in 1993 with a consortium led by the French firm Suez for the metropolitan area of Buenos Aires. After the 2001 economic crisis, under the government of Néstor Kirchner, many concessions were renegotiated. Some were even terminated, and the responsibility for service provision was reverted to public entities, as it was the case in Buenos Aires where the newly created public enterprise Agua y Saneamientos Argentinos took over the responsibility for service provision in 2006.