The 21st Century’s Oil

The World Bank estimates that by 2025, two thirds of the world’s population will not have safe water. In the United States, aquifers are rapidly declining; the entire Colorado River disappears into aqueducts before it reaches the Gulf of Mexico. In Africa, Lake Chad has shriveled to just 5% of its former size over the last 40 years; and in Central Asia, the Aral Sea, once the fourth largest lake in the world, has lost 75% of its water.
Many corporate executives view this crisis as a business opportunity. Water is already a $400 billion global business, mostly controlled by two French corporations, Vivendi and Suez, with more than 200 million customers in 150 countries.
Transnational water companies are seeking to own or run water systems — as they soon will in Stockton, and already do in San Diego and other California cities — and to purchase rights to ship water to the highest bidder anywhere in the world. The Canadian company Global H20 has a contract to ship 58 billion liters per year of Alaskan glacier water to be bottled in a Chinese free-trade zone. Company officials have boasted that by using cheap labor they will “substantially undercut all other imported products.” Meanwhile, here in California, a consortium of transnationals has sought rights to water from the Mad River for shipment to San Diego [see Terrain, Spring 2003].
Deals like these show that globalization is no longer something the First World does to the Third. Corporate colonization is happening everywhere: Suez CEO Gérard Mestrallet has proclaimed that his business will continue the “philosophy of conquest” that it began in the 19th century when it built the Suez Canal.
Now — just in time to facilitate that process — new international trade laws may give private companies even more latitude for dealing in US water.
This spring, trade representatives met to discuss GATS, the Global Agreement on Trade and Services. GATS sets rules for how multinational corporations can do business in “services” — from telecommunications to mining to postal services, welfare, libraries, and water supply.
GATS rules are supposed to ensure that all service suppliers, public or private, can compete equally in the market — government is regarded as a competitor like any other. If the US agrees to put water on the global market as a GATS service, no federal, state, or local government can create a publicly owned water district without allowing transnationals to bid for the same service. This applies not only to supplying water but also building and maintaining facilities, pipelines, water treatment, water quality testing, sewage treatment, and more.
A second basic principle of GATS is “harmonization,” which often results in lowest-common-denominator standards that support profits rather than human and environmental health. Harmonization would let corporations challenge any regulation — concerning water quality, for example, or universal access or licensing standards — as a “barrier to trade.”
Disputes over GATS are dealt with not in the communities that depend on the service, but in secret trade tribunals in Geneva [see Terrain, Fall 2001]. The track record of such tribunals (which handle disputes over similar international trade laws, like NAFTA or GATT) is anything but reassuring. WTO tribunals, for example, have invalidated European laws against the use of hormones in beef cattle, US standards for clean-burning gasoline, and US regulations to protect sea turtles.
And what if the United States decides not to put US water on the bargaining table? GATS rules say that corporations must have access to the resources they need to carry out services that are included under GATS. If the US puts thirsty industries like logging, mining, or agriculture on the international market, it may be obligated to provide the water to make that business possible.
Plus, current proposals under the latest GATS negotiations (known as GATS 2000) would apply the  harmonization requirements — which create lowest- common-denominator standards — to all services, regardless of whether a country includes them under GATS. This provision could lead to the invalidation of almost every environmental regulation in the country.
As a California State Senate committee warned, trade agreements are “shifting the balance of political power — away from state legislatures, away from national courts, and away from public proceedings by which voters could hold elected officials accountable” and to “non-elected international trade officials” who are more responsive to multinational corporations than they are to the people.

Comments are closed.