The Water War:
Hydraulic Resources Strategy and Citizen Participation at the IDB
In the Case of Bolivia

By: Margarita Flórez-REDBANCOS/ILSA
Pablo Solón-FUNDACION SOLON

March 2001

I. Executive Summary

The privatization of natural resources in Latin America -- a strategy both imposed and financed by the multilateral development banks (MDBs) -- stems from existing weaknesses in their public administration until now, and from the need to liberalize asset markets. Based on the belief that market management would bring benefits regarding the distribution and conservation of resources, the Inter-American Development Bank developed the Urban Public Services Policy (IDB, 1996), later followed by the Integrated Water Management Strategy.

We believe that this strategy privileges the economic aspects of water resource management above social, cultural and environmental considerations. Indeed, these latter aspects are only referred to in a tangential manner. We further contend that the near exclusive emphasis on economics is the central cause of weaknesses the strategy has demonstrated in its practical application. These weaknesses are clearly demonstrated in the case of Bolivian water privatization.

The application of this strategy has supported market forces, producing results that should have lead to a general rethinking of the strategy, and more specifically of the role citizen participation in strategy development and application. Although the strategy specifically indicates that it is to be applied taking into consideration national circumstances and context, in practice there does not appear to be any notable differences in its application in different countries or regions. The practical application is always essentially the same: modification of the regulatory system, establishing private water rights, and such.

Such uniformity of application does not in practice permit the integration of, among other things, differing levels of development and cultural diversity. Such an application would necessarily lead to the recognition of social systems very different from those in Western countries, differences that must nevertheless be understood as of equal value and importance. But neither in the form or the application of these policies are such values taken into account. Because of this, Bank policies can sometimes stifle themselves and explode, as was demonstrated by the Bolivian Water War uprising. Such social acts of rejection should not result in the disqualification and de-legitimization of these actors, but rather their inclusion in the very processes that affect them.

The IDB water resource strategy was adopted using the following general methodology: first, some general guidelines were developed, which were then later modified by specialists, and finally opened to some cursory discussions with a few civil society representatives. We believe that the very the weakness of the water resources strategy and its application result from the faulty methodology used to define the strategy in the first place.

As has been amply demonstrated by the experiences of Bolivia, Panama and El Salvador, it is not possible for a strategy about a natural resource as vital to human survival as is water to be subjected to the oscillations of the market. Without denying legislative obsolescence and the weakness of public administration, the tendency to pass the management of public resources to private hands as the only way to correct detected weaknesses should be reviewed. For one, there exist historically proven but yet unexplored traditional water management customs. These traditional systems may be one alternative to the current public administration system.

Nor does it appear viable to maintain the low valorization afforded to citizen participation as simply invited guests at User Meetings. As it stands now, citizens are seen more as instruments to help markets function better, rather than as policy proponents or participants at in-country negotiation tables. If, as IDB documentation mentions, the Bank is responsible not only to governments–their priority interlocutors–, but also to their parliaments and to citizens in general, then the issue of participation cannot continue to be considered as an isolated exercise. Rather, it must be considered as an integrated component of all Bank policies, projects and loans.

To demonstrate the result of the application of the water policy in Bolivia, we use the following basic criteria: (i) the fulfillment of the Integrated Water Management Strategy dispositions, [GN-1908 - 4] and (ii) the fulfillment of the citizen participation dispositions.

II.            Background

Participation: a long road full of NGO interpolations.

Since the Eighth Replenishment in 1994, the IDB has adopted a wide range of measures to accomplish "a greater interaction with civil society, with particular emphasis on participation and transparency in its dissemination." In the Eighth Replenishment, emphasis was put on the fact that the IDB is responsible directly to its member governments and indirectly to parliaments and citizens [IDB - 8].

Four years after the Eighth Replenishment, from the perspective of some NGOs, the IBD had committed itself to: (i) adopt a policy on the availability of information; (ii) expand the scope of public participation in Bank financed projects; (iii) establish a national claims mechanism for negatively affected citizens; (iv) strengthen the policies and procedures of environmental impact evaluation; (v) assure that the Bank incorporates a gender dimension in its projects, and (vi) assure that the rights of Indigenous populations are respected.

This NGO analysis recognizes the advances of the 1995 policy on the availability of information, and the opening of the Public Information Center. Nonetheless, it maintains that the opening of the central office in Washington DC did not coincide with the opening of the regional offices. Furthermore, it is important to note that even if the discourse did incorporate the demands for participation, such discourse was not implemented in an either absolute or partial manner. This was underlined by the lack of any guidelines, strategies or policies, to guarantee citizen participation.

Once again a group of NGOs submitted their considerations and presented their opinions on participation in a document entitled "How to Put Participation in Practice in the Inter-American Development Bank." This analysis reaffirmed that "participation means a right to fully participate in the decision making process". Four key areas into which civil society participation should be incorporated were identified. They are: (i) country programming; (ii) policy based lending; (iii) Bank strategies, policies and procedures; and (iv) investment loans.

The most recent IDB document outlining their strategy for civil society participation "Citizen Participation in the Activities of the Inter-American Development Bank" is still in its initial phase and has yet to be widely consulted. As such it is at a stage of development which makes a full analysis of its content and strategy premature.

Background on the Water resources Strategy.

Prior to the adoption of the Seventh General Replenishment of Funds in 1989, the IDB natural resource policy was reduced to supporting resource conservation, the constitution of parks and forest reserves, and the protection of flora and fauna. It was not until 1989 that the IDB "internalized the concept that the conservation of natural resources and sustainable development are two sides of the same coin" . That is to say, at that time it began to put more emphasis on the protection of natural resources as its base of development operations. To begin to broach the concept they started with the premise that the river basin represented a tri-dimensional structure: the river basin as a process, as a system, and as a set of sequentially organized activities. Within the conception of river basin management as a process, they considered that in all its phases, the full participation of the project beneficiaries should be guaranteed.

In the introduction of Document e71 of Recommended Practices for the Development of Water Sector Laws and Regulations, Criteria of Analysis, Equity Item, the authors note several different systems used for the allocation of water and indicate that:

" Those who privilege very politicized allocation systems tend to not take minority groups into account, or to define policies and programs based on the interests of pressure groups with privileged access. Systems with excessive focus on markets tend to disregard uses that are not very profitable but are still environmentally relevant, as well as groups that are insufficiently organized to participate in the process. In general, groups and individuals that advocate for the protection of minimum ecological volumes are very disperse and difficult to organize".

Institutional Elements that Minimize Conflicts Between Sectors suggests an open and public process as a mechanism to attain this objective. The right to participation without adequate preparation may be useless, however, or may even contribute to the increase of prices. But it makes very clear that "there are no laws that require the provision of funds for public participation in decisions about water". Quebec is mentioned as an exceptional case. Here government agencies can set aside moneys in their project budgets specifically to cover the costs of the participation of citizen representatives.

The document recommends projects assure citizen participation with regard to information access, and in the treatment that Indigenous groups should receive. On this subject it indicates that traditional water use practices are not even considered–not to mention compensated–in the evaluation of projects.

On the subject of water markets and negotiable water rights, opinions concurred in the need to change resource administration systems, and regarding the efficiency of water markets as economic instruments to reallocate uses.

It also indicates that these water markets "have repercussions on public goods such as environmental quality", and for this reason their functioning should be accompanied by protective measure.

Monopolization should be avoided, and limits to these rights should always be established.

Finally, it mentioned that the water market should consider social and cultural effects, and predicted the use of community allocation as a mechanism to acknowledge these rights more in keeping with community realities.

III. The Integrated Water Management Strategy.

The Integrated Water Management Strategy (Estrategia Sobre Manejo Integrado de Recursos Hidricos) was adopted in 1998, thereby implementing the Eighth Replenishment [IDB-8] agreement in which it was indicated that the bank:

"Will develop and implement the directives on water management, which serve as the base of an integrated focus on the regulation of river basins based on the consideration of all the sources and uses of water in a determined fluvial water basin."

The integrated water management strategy supports sustainable processes and proposes the application of a:

"Participatory focus motivated by incentives and ecologically conscience, and that places a particular importance on integrated management".

The underlying assumption is that water is a natural resource on which life, food security, and ecosystem health depend. This strategy is based on "economic efficiency" without "sacrificing equity and environmental considerations."

To develop this base projects should: (i) place an economic value on water resources, and (ii) establish negotiable water rights and water markets, consequently widening private sector participation in this market.

Country participation. The document specifies that the strategy is concerned with the formulation of principles and with the flexible application of instruments, and not in the instruments themselves. That is to say, they are recommendations and parameters. Within the list of possible instruments is…"community participation". The practical application of instruments is left up to each country on a case-by-case basis.

This is perhaps one of the reasons why the section on principles makes direct reference to country participation and to "institutional and cost-benefit analyses of proposed projects", but not to citizen participation.

The participation of social sectors appears within the objective Institutional Innovation and Capacity Formation, which lists the following as a basic principle:

"(ii) the entity in charge of water resources should encourage a two-way exchange (top down and bottom up) in order to achieve the effective participation of communities and water-users";

The same objective makes further reference to participation, asserting that:

"Institutional biases prevent women from fully participating in the solution of problems related with water resources", and that in addition, "Women play a central role in the supply, management and conservation of water, particularly in the community arena. Thus we recommend that capacity strengthening programs should emphasize gender issues in order to create a situation propitious to the operative implementation of these recommendations".

In the section Strategic Instruments for Integrated Water Management: Private sector participation and the role of the public sector, they speak tangentially of the users (consumers) associated with the water market, and of negotiable water rights. The document states:

"As water-user associations play an important role in the functioning of markets, it is important to strengthen them. Without the good supervision of water-users it is improbable that the market will yield the expected benefits."

With respect to the environment they warn that:

‘Water markets have effects on public goods such as environmental quality. When establishing the market, care must be taken to incorporate this quality, as well as the social and cultural goods that are also affected by the market"

The Operational Directives indicate how to incorporate these strategic principles into the Bank’s operative plans. In the item Project Preparation, there are various references specific to citizen participation:

a.      Water utilization: Actors includes the public sector, civil society, and private businesses.

b.      Environment focuses on the principal characteristics surrounding water utilization that are or must be included in the measures adopted by the actors"

c.      Water related legislation and policy. Integrated management measures should resolve the environmental and social welfare problems they cause.

From the Bolivian popular protest -- caused in part by the deficient application of this Strategy -- we can see that sometimes these technocratic presuppositions are purely rhetorical. Instead of being substantial elements backed by democratic processes, they are merely social detonators.

IV. The IDB and the Water War in Bolivia.

The objective of this case study is to analyze the effect of sectoral policy and IDB projects on what has been termed the Bolivian Water War of the year 2000.

A. The IDB and Water in Bolivia.

According to the Bolivian Country Paper (X/98), the IDB is the countries principle financial entity, contributing $1.384 million of a total of $4.231 in 1997, and contributing 20% of total financing for water related projects in 1995-1997. This number increased to 25% in the period from 1998-2000.

The $19 million Sustainable Development Ministry strengthening project includes among its objectives the systematization of information and other elements of water resources planning.

According to the Country Paper, the IDB’s strategies for Bolivia include three lines of action: (i) economic growth and opportunity creation, (ii) human capital development and access to basic services, and (iii) governability and reform consolidation.

B. Objectives of the Application of the Strategy in Bolivia.

C. The Water War

Below is a chronology and analysis of the social convulsions that occurred as a result of the actions taken to modify the water law.

1. Causes of the Conflict over the Water Law.

The current Bolivian water law dates back to 1906, and stems from a 1879 water regulation that has been modified–in a contradictory manner and towards various ends–throughout the twentieth century. All government sectors and civil society agree that it is no longer consistent with current legislation and present-day reality.

During the last decades, more then 20 versions of new water law projects have been written (some with IDB financing), but none have incorporated the demands and rights of native Indigenous and campesino groups.

2. The popular response: Questioning the water law project.

Various Indigenous and campesino movements and other civil society sectors submitted well-developed counterproposals, such as the May 1999 CSUTCB, CSCB and CIDOB proposal. The Indigenous campesino movement’s most important proposals are laid out in the documents The Coordinator for the Defense of Water and Life in Cochabamba (Coordinadora de Defensa de Agua y de la Vida de Cochabamba) and the Technical Table of Water, and can be summarized as follows:

2.1. Types and characteristics of water rights.

There is no differentiation between the social and the lucrative, or commercial, use of water. The regiment of water rights, concessions and titles are applied equally to commercial companies and activities and to campesino communities and other social uses.

There is no prioritization mechanism for the conference of concessions, which could result in preferential treatment to those with more influence or better conditions to comply with red tape and paperwork. This is due, among other factors, to the nature of the strategy, which is essentially only a group of "best practices" that are open to flexible (and varied) interpretations.

It requires campesino and indigenous communities who seek concessions to demonstrate their customary uses based on a set of regionalized customs regulations. This signifies:

        i.       The transformation of changing and non-legislated uses and customs into an existing norm;

      ii.        Submitting communities to a series of lengthy studies and requirements such as characterization and special necessity studies for the titling of original communal lands (tierras comunitarias de origen);

    iii.         Generating a lot of bureaucratic paperwork, which disadvantages the poorest and furthest away from cities;

     iv.       Permitting campesinos to apply individually for concessions, thereby affecting the rights of communal access to land and generating conflicts within communities.

       v.      Establishing that in rural areas concessions will be granted to landowners. This may generate conflicts as the land is not drained, and a community’s water source, which is of social and communal use, is located on private property.

The water law project encourages the privatization and commercialization of water, which carries the danger that sectors with greater economic resources will end up appropriating water sources.

The law also allows that all titleholders, be they related to agricultural, livestock, mining, or other rural activities, may charge a fee to those who use their concession.

2.2 Water Superintendency.

The creation of the Water Superintendency was proposed as a regulating entity, but was questioned for the following reasons:

There is no explicit role for civil society participation and control.

Its appeal process makes it both judge and jury of its own decisions.

The possibility of recourse with the Supreme Court to question the determination of the water superintendency endorsed by the General Superintendent is practically inaccessible to the majority of the rural water right titleholders.

The superintendencies are entities that tend to give concessions to business sectors because of the higher regulation fees received from them.

The superintendents are not apolitical as they claim. Rather, they are designed based on political accords in Parliament, and respond to these accordingly.

There are conflicts of interests with the companies that they regulate. Various superintendents were high-level functionaries of the companies that they now regulate, or go on to be high-level employees of the same when they finish their term of superintendency.

The structures of planning and policy definition that are under the Ministry of Sustainable Development and Planning (Desarrollo Sostenible y Planificacion) are extremely bureaucratic, and do not count with real civil society participation. Among the planning and regulatory entities there are few interrelational entities.

D. Proposals from civil society for a water law.

The water law proposal of CSUTCB, CSCB and CIDOB were not discussed in an opportune manner due to the lack of participation mechanisms. This led to the rupture of dialogue, and to the rejection and loss of confidence for any water law project by the campesino movement in the north antiplano.

There should be a differentiated regimen for those who have a social use of water and those who use it for commercial or business purposes. The former requires Community Water Rights (Derecho Comunitario de Aguas) for indefinite periods of time through free and collective registration, while for the latter a renewable 20-year authorization is recommended.

To register a Community Water Right, there should not be any requirement to "demonstrate uses and customs", but rather to present a document that demonstrates the existence of a campesino community, Indigenous community, or campesino irrigation system.

Registration should be collective for all campesino communities and campesino, Indigenous, urban and semi-urban communities that share the same water source. This is to avoid conflicts and to encourage cooperative planning processes for river basin and sub-river basin administration.

Community Water Rights and Authorizations should not be transferable, in order to avoid the creation of a water market. Retribution, compensation and incentive mechanisms should be established for use and benefit without generating or generalizing a water resources market.

Participatory planning and technical management entities are the only instruments capable of achieving sustainable and appropriate utilization and the equitable and consensus-led distribution of water resources. These entities should be the management committees and plans of sub- and micro- river basins that incorporate the appropriate social organizations and technical institutions of the region.

The regulatory entity should combine the functions of regulation with those of planning, since water resources should be regulated in function of planning and not of the market. The regulatory-planning entity should be collective with the decisive participation of civil society, such as via the National Water Council (Consejo Nacional de Aguas). On the operative level there should be an executive technical entity via a National Water Director (Direccion Nacional de Aguas).

Finally, there should be technical boards and directorships with similar characteristics at the river basin, sub-river basin, and micro-river basin levels.

E. The Potable Water and Sewage Law: A Bias in Favor of Private Agents.

1. The Sectoral Regulation System and the Potable Water Law.

In October of 1994 the Bolivian Congress approved the SIRESE law -- the Sectoral Regulation System, or Sistema de Regulacion Sectorial in Spanish -- which established a system of superintendencies for public services and created the Water Superintendency.

The statutes of the Institutional Organization and of the Water Sector Concessions approved by Supreme Court Decree No. 24716 of July 1997 established the Water Superintendency and determined that this superintendency–which basically covers potable water and sewage–will also cover other water resource uses.

In October of 1999, the Bolivian Congress passed the Potable Water and Sewage Law No. 2029 in only two days. The law changed the name of the Water Superintendency to that of Basic Drainage and empowered it to regulate water rights in all its uses (agricultural, industrial, mining, etc.) until a new Water Superintendency was created, based on the new law and dependent upon the Regulatory System of Renewable Natural Resources (Sistema de Regulación de Recursos Naturales Renovables, or SIRENARE).

Law 2029 was passed without consulting civil society:

·      To back up the concessionary contract that was signed on September 4, 1999 in Cochabamba with the company Aguas del Tunari for potable water, sewage and drainage services.

·      To assure federal law backing for the Basic Drainage Superintendency’s acting role as Water Superintendency once the water law passed.

In general terms, the rejection of this law was due to the fact that it was biased towards the private concessionary companies and against public systems, users, small potable water systems, and Indigenous and campesino community rights. As a result of the conflict and social pressure, 36 of the law’s 80 articles were modified.

2. Law 2066: reformed aspects. The Accomplishments of a Social Movement.

The most important of the components modified by Law 2066 are the following:

Law 2066 separates the roles of the water resources law from those of the Potable Water and Drainage Service Law. It eliminates the Water Superintendency dependent upon SIRENARE.

The Basic Drainage superintendency has only "transitory" authorization over water destined for potable water service. Federal law must approve the authorization of any other use until the new water law is passed.

Law 2066 does not make reference to a water resources concessionary regimen, but rather to an authorization regimen.

Unlike Law 2029, Law 2066 does not grant exclusivity of concessionary zones to concessionary companies. The law respects water committees, neighborhood collectives and cooperatives that offer services in areas with more than 10,000 inhabitants. These organizations have the option of remaining independent or coming to an agreement with a concessionary company, on the basis of economic compensation for their infrastructure and installations.

It creates a Registry category to guarantee potable water services to campesino communities and indigenous towns for the useful lifetime of the service.

This modifies the license category guaranteeing urban and rural community organization the lifetime use of potable water instead of the 5 years granted in Law 2029.

While Law 2029 only guaranteed the water use rights of the concessionary titulars, Law 2066 guarantees water sources indefinitely for Registry titulars and for useful service lifetime for license titulars.

Law 2066 creates mechanisms for citizen participation, obliging the Superintendency to inform and receive opinions from municipal governments and entities of popular participation in order to approve fees and sign contracts.

It establishes that fees will not be calculated in dollars, and that only the variations in direct cost price indices will be taken into account during monthly fee modifications.

It eliminates the postulate that the criterion of financial sufficiency for the concessionary companies’ stockholders is the principal criteria in the definition of fees.

It establishes that compensation for the poorest sectors will be included as a variable in the indexation and charge of fees.

It eliminates the obligation that cooperatives dealing with the Basic Drainage Superintendency convert to private companies.

F. Privatization of potable water and sewage services.

1.      Aguas del Tunari

2. Aguas del Illimani

Toward the end of the year 2000, a second wave of protests in the city of El Alto questioned the contract and Aguas de Illimani’s activities in the provision of potable water in both El Alto and La Paz.

The contract with Aguas del Illimani was signed in 1997 to privatize the potable water and drainage services in La Paz and El Alto. Until now, these fell under the administration of the municipal public company SAMAPA (Municipal Autonomous Service of Potable Water and Drainage, or Servicio Autonoma Municipal de Agua Potable y Alcantarillado in Spanish).

The goals for the 1998-2001 period included the extension of the household network with 78,252 new potable water connections, of which 71,752 are in El Alto/Tilata and 13,000 sewage connections, of which 10,700 are in El Alto.

2. 1 Observations by the social movement.

The following observations have been made about this contract:

Price Increases.

The fees charged by Aguas del Illimani continue to be pegged to the dollar, despite the fact that Law 2066 has established that indexing formulas should only include variations in price indices that directly affect the sector.

The price for a potable water and sewage connection continues to cost $330 (USD), despite the fact that the company has introduced systems that lower its installation costs. The $330 connection price is excessively high for families that have a monthly income of less than $70.

The contract with Aguas del Illimani establishes that entities dependent on the state and municipality -- such as schools, health centers, parks, army bases, offices etc. -- must pay the higher rate of $1.82 for 3m of potable water. This is a significant irregularity if we take into account the fact that the provision of potable water and drainage to the city of La Paz is channeled through the infrastructure transferred from the municipal company SAMAPA.

The water superintendency has granted Aguas del Illimani the right to charge for the crude water extracted through private wells in the cities of El Alto and La Paz. This is irregular as well, since Aguas del Illimani should not charge for crude water that it doesn’t make potable.

Lack of clarity

The commitment to enlarge the network to various neighborhoods the El Alto.

The ties of high level officials of the current and previous governments to Bolivian Aguas del Illimani stockholders.

G. Bolivia: A typical case of conditionality by multilateral financial entities?

During the last decade, various multilateral entities , including the IDB, have conditioned the disbursement of payments to the development and approbation of a new Bolivian Water Law, to the promulgation of the Basic Drainage Law, and to the privatization of the potable water services in La Paz and Cochabamba.

1. Cases of Conditionality.

The National Irrigation Program PRONAR (964/SF-BO) of 1995 designated a loan of $505,000 for the development and approbation of the water law, sectoral norms on the different uses of water and the initiation the of national water authority. The special conditions for the execution of the investment component of the PRONAR project determined that the first payment of 45% ($9 million) would be conditioned on "the presentation to Parliament of a consensus water law project, and a second payment of 30% ($7 million) would be conditioned on the fulfillment of "the approval and implementation of the general and sectoral regulations of the water law".

The 1996 Urban Basic Drainage Program (987/SF-BO) for cities with more than 5,000 inhabitants is linked to the development and approval of sectoral norms and the introduction of a regulating entity for which the Technical Assistance Loan (ATN/MT-5442-BO) of $980,000 was approved. The principal activities towards the formulation of a legal framework include "the preparation of the regulations on institutional aspects, use of public goods and the constitution of easements, concessions and authorizations, fees, the rendering of services, and infractions and sanctions."

The 1995 Urban Basic Drainage Program (987/SF-BO) proposes the concession of La Paz's and Cochabamba’s potable water, drainage and sewer services, and indicates the "Bank’s consent" to support private company concessionaries with credit.

H. Application of the Strategy: Case by case? Country by country? Citizen or rhetorical participation?

The concepts of public or private rights are insufficient to understand the reality of indigenous campesino communities where there are social community rights.

One of the presuppositions of the IDB Strategy is that the instruments will be applied in accordance with national reality. This premise was apparently not applied in the Bolivian case. Adapting to each reality means understanding, considering and valorizing the social and cultural differences of each country, and not just proceeding in a routine and uniform manner.

The IDB strategy for water resources in Bolivia suffers from the unpardonable omission from which social conflicts stem: that in the national reality, there exist Indigenous and campesino communities which have their own traditional use and management methods.

By not understanding this reality and consequently creating legislation more appropriate to a country with more Western and homogeneous characteristics, we fail to see that private rights have different understanding and meaning in Indigenous communities and towns. For these populations, water is a common good that cannot be appropriated or privatized. In this context, proposing negotiable private rights is like lighting a match in a gas station.

The strategy thus suffers from a rigid framework in two senses: (i) on one hand, it opts for water markets and privatization while ignoring community allocation traditions; and (ii) it ignores the existence of polydiverse nations such as Bolivia. In practice, its application homogenizes and generalizes a single recipe, which negates its purported case-by-case and reality-informed application.

The Strategy promotes citizen participation in all steps of the strategy application process.

Precisely in the year of the National Dialogue, which was realized with a high degree of delegate participation at the departmental, regional, municipal and sectoral level, and with the support and financing of international cooperation, the September conflict broke out. A new 20-day dialogue with other speakers and participants had to be carried out, all in the midst of the deaths and the more than 20 days of paralysis in the country. This is to say the participation presupposition of the Bolivian Integrated Water Management Strategy was not applied to decision making, either by members or participants.

SITUATIONS THE IDB SHOULD PROMOTE

The case of the Bolivian Water War and its relation to the IDB water hydraulic water resources strategy should be amply analyzed and evaluated by the Bank to capture the necessary lessons.

Conclusions

IDB policies and strategies should strictly follow the provisions of the Eighth Replenishment, especially those pertaining to wide citizen participation, the gradual application of policies and strategies, adaptation to country-specific conditions, as well as environmental aspects and the multi-valuation of resources. Below, we enumerate some of the principal points that we believe the IDB should consider in the process of evaluating integrated water resources management projects.

We have seen that the sectoral adjustment process promoted by multilateral development banks is based on the assumption that the deficiencies in resource utilization ultimately come from not understanding resources as assets, and from assigning its administration to the public sector. Based on these assumptions, the parameters are established according to which this model should function in almost a mechanical manner. In its very design the Integrated Water resources Management Strategy suffers from various deficiencies:

1.      It was created through a technical process, which exclusively incorporated input from technical assistants and academics. The points of views of water users and the inhabitants of the member states of the IDB were not considered.

2.      In the documents studied, there were no considerations of traditional community administration mechanisms that date back to precolonial times. They have long demonstrated their efficiency, and could potentially be used.

3.      Populations themselves are not viewed as useful mechanisms for the model, as is implied in encouraging "citizen participation in resource management through river basin, sub river basin, and micro river basin commissions" with the sole intention of strengthening water markets and negotiable water rights.

4.      The economic focus does not guarantee the incorporation of environmental and social aspects, and by itself, has not demonstrated its ability to increase efficiency nor lower costs.

5.      Although citizen participation is mentioned in both the Sectoral Strategy and the Bolivian Country strategy, there is no application of transparent publicity mechanisms, opportune information and guarantees of social audits that would assure an optimum socio-environmental impact.

6.      Despite the fact that the IDB recognizes and has an Indigenous Peoples Department, the issues of indigenous communities and populations should be incorporated in an explicit manner into the Bank hydraulic water resources strategy. They should both conceptually and practically incorporate both international and national statutes, which also constitute obligatory norms for the Bank.

7.      The process of adoption, application and evaluation of the strategies and policies of the IDB should be carried out with the participation of water users–that is, the communities. They should convoke a wide citizen consultation to examine the balance of the application of the strategy in the different countries in which it has been implemented. This with an end to correct its weaknesses, both theoretical and applied. The design and application of water laws is essentially a citizen-driven process that should not be left in the hands of consultants that don’t represent all of the most commonly held points of views.

The IDB would do well to question why protests are increasingly common in regions where their policies and strategies are applied. The objective of the Multilateral Development Bank is to contribute to the development and attend to the needs of its populations. Accordingly, they should remember that their actions are subject to the political control of parliaments and ordinary citizens. The long hoped for governability in the region can not become a reality until those who take measures with significant social and environmental impacts convoke the general population to agree upon and define the policies that affect them.

CRONOLOGY OF THE WATER WAR

Based on 12 Bolivian newspapers

April 20 1999 The Bolivian government annuls the bidding for the Misicuni Project. Instead of convoking a second bidding, it demands negotiations with the company Aguas del Tunari.

April 28 1999 The government authorizes the opening of envelope B, which reveals that the concessionaire had no intention of carrying out the Misicuni multiple projects (potable water, electricity and irrigation). Aguas del Tunari is obligated to modify their proposal.

June 11 1999 The government accepts Aguas del Tunari’s proposal through Supreme Court Decree 25351.

June 11 1999 Promulgation of Supreme Court Decree 25413 through which the project is adjudged to Aguas del Tunari. Aguas del Tunari seeks financing to invest in Misicuni.

September 3 1999 It is announced that three company transference contracts will be signed in the Prefect to the Aguas del Tunari company for potable water, electricity and irrigation service for a total of 214 millions of dollars.

September 4 1999 The director general of Aguas del Tunari, Geoffrey Thorpe stamps his signature on the contract.

October 29 1999 The 2029 Potable Water Law is approved.

December 1 1999 Cochabamba in marches to protest the 35% increase that would come into effect as of December 2.

December 15 1999 Civic citizens demand the destitution of the Presidency Ministry for "devious and altered (anañada y digitada) bidding".

December 22 1999 Convocation of the Coordinator of the Defense of Water and Life (Coordinadora de la Defensa del Agua y de la Vida). Organizations mobilize against the fees.

January 12 2000 Generalized roadblock of all the roads inside Cochabamba.

January 14 2000 Leaders of the civic movement and four ministers sign an accord to revise Law 2029, the contract with Aguas del Tunari, and to discuss a consensus proposal on the future water law.

February 5 2000 Police repression leaves a balance of 32 injured.

February 6 2000 Cochabamba succeeds in getting the government to order the freezing of fees.

February 8 2000 The Basic Drainage Superintendency announces that it did not authorize the freezing of fees.

February 9 2000 The Coordinator proposes the modification of Law 2029 to allow for the substitution of a National Water Council (Consejo Nacional de Aguas) for the Superintendency, and insists on rejecting the contract with Aguas del Tunari.

March 27 2000 The population votes on the three questions that the Coordinator put forward in the Popular Consultation, with a total of 50 thousand votes cast.

March 28 2000 The Coordinator sets the date March 31 as the deadline for the consortium Aguas del Tunari to go.

April 4 2000 In support of the Coordinator, LAB ship workers and pilots leave Cochabamba isolated for 24 hours. Indefinite roadblocks are initiated. Strikers are joined by CODA, FEDECOR, professional colleges, San Simon University Student Centers, UMSS, Federation of Secondary School Students, Federation of Cochabamba Campesinos (of Moises Torres and of Alberto Zapata), Federation of Retail Merchants, Heavy Transport of Cochabamba, FUL University Coordinator, Federation of Business Entities, Neighborhood Groups, the Feminine Civic Committee, and the Federation of Light Transport.

April 6 2000 Conflicts heighten in six Departments, and they threaten to take measures by April 15.

April 7 2000 A virtual state of siege rules in Cochabamba. Demonstrators approach Prefect authorities.

April 8 2000 The Government does not respect the mediation of the Church in Cochabamba. They resort to forces of order to detain the leaders of the meeting participants.

April 9 2000 A state of siege is declared in the entire country. 17 leaders are detained and confined in San Joaquin. Cochabamba is up in arms. The forces of order let loose a massive repression. Army snipers, a 17 year old, kill VICTOR HUGO DAZA.

April 10 2000 The modifications to the 2029 Potable Water Law are approved in Parliament. Cochabamba wins the Water War, and celebrates the departure of Aguas del Tunari.

April 11 2000 A SEMAPA residual begins to administer the potable water service.

April 14 2000 Human Rights Activists denounce the fact that of the 32 injured, 21 received gunshots.

April 25 2000 Superintendent Luis Uzin announces that the contract is totally annulled. Aguas del Tunari conceals almost everything from the Superintendent.

September 1 2000 Colonel Juan Manuel Yepes Alfaro ratifies that Captain Robinson Iriarte received orders from his superiors to "act as he acted" on the violent day of April 8 in the "Water War" in Cochabamba.

September 5 2000 The president of the Congressional Human Rights Commission, Manuel Suarez, denounces military abuses in the Water War.

September 7 2000 The Water Coordinator demands the suspension of civic elections.

September 7 2000 Campesinos give the government a deadline by which to withdraw the Water resources Law proposal from Parliament.

September 18 2000 The CSUTCB initiates roadblocks.

September 20 2000 The Defense of Water and Life Coordinator (Coordinadora de Defensa del Agua y de la Vida) initiates a strike and roadblocks.

September 29 2000 La Paz is circled and cut off from supplies by roadblocks.

October 7 2000 After 9 days of negotiation an agreement is signed to archive the Government’s Water Law.

Bibliography

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