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Gats and Water

A key comonent of the Gats trade negotiations was water and water services. This is unsurprising given the lucrative potential of supplying such a fundemental human need.

An article in 2005 reported how Henry Heyneardhi in the Jakarta Post showed how "Only five per cent of the world's population buys water from transnational corporations (TNCs), but the annual revenue has already reached 40 per cent of the oil sector. With this enormous potential for profit, water TNCs are pushing to legitimise the trade of water as a commodity through the WTO's General Agreement on Trade in Services".

It also reported how "Fortune magazine in May 2000 predicted the global trend in the water industry thus: Water promises to be to the 21st century what oil was to the 20th - the precious commodity that determines the wealth of nations."

And that "Water, has become one of the biggest businesses globally. The magazine estimated the annual revenue of the water industry at some $ 400 billion, 40 per cent of the oil sector. This revenue is generated from a mere 5 per cent of the world's population that depends on corporations for water. Thus, the potential market growth is very high. In 1998, the World Bank estimated the market at $ 800 billion, and revised it to $ 1 trillion the following year".

While "The giant water TNCs are in competition for a share of the market, and are pursuing the same goal - to establish a global water market where it can be traded as a commodity.

"Put water on sale, and let the market determine its future," seems to be their demand".

"This goal can be achieved by legitimising the trade of water through free-trade instruments such as GATS. In the GATS-WTO regime, water supply is in the same category as education, health-care, banking, tourism, transportation and waste management".

The article also states analyse "Future negotiations and what they imply"

"GATS thus implies that all countries, after "appropriate negotiation", should open their market to water supply services in the future. This means that the governments shall, without any qualms, transfer water management to the private sector".

"As liberalisation confines the role of the state to that of a mere facilitator, the transfer of public ownership of water services to the private sector is expected to fall first into domestic and then foreign players.

Proponents of GATS are convinced that privatisation of water and the concept of a global water market will benefit the rich and the poor.

Increasingly, civil society organisations are becoming aware, and voicing their criticism to services like water suppy being legally bound by such trade agreements as GATS.

These criticisms concern two main issues. First, of GATS helping the private sector, especially giant water TNCs to expand their operations all over the world.

When corporations sell water for profit, the quality, access and safety of water supplies are endangered and the future of water resources becomes threatened.

And, second, of the fundamental principle of water being an essential resource for every living being. Thus, decisions on this resource should be made democratically at the local, national and global level, and on the basis of people's fundamental right to safe and affordable water".

Despite intense lobbying efforts water was not included in the WTO GATS agreement [1]. GATS would have effectively legalised the forcing of privatisation and/or liberalistion of water services right across the world. Alongside other environmental services water services were exempted, as they were from the EUServices Directive. However, the battle to maintain or abolish the exemption is a continual one. At a WTO conference in July 2008 it was said "Virtually all major sectors were covered during the conference. In particular, financial services, telecommunications, transport and a range of professional services were frequently mentioned. There were also many indications of willingness to facilitate access in environmental services, in line with the objectives of the Doha Ministerial Declaration" [2].


  1. Corporate European Observatory Water almost out of GATS (March 2006) Accessed 1 December 2008
  2. WTO News Items SERVICES NEGOTIATIONS Lamy circulates report on market access commitments in services Accessed 1 December 2008