World Water Day: Governments cause, and markets solve, problems with access to water and sustainable use

17 March 2003, London, UK -- World Water Day is 22 March 2003, and the theme is "Water for our Future". To coincide with World Water, Day, the United Nations has just released the World Water Development Report, which suggests that by 2050, several billion people will not have access to clean water.

The Sustainable Development Network believes that governments are the main problem with lack of access to clean water, because they actively subsidize water use or do not allow trading in water. For access to clean water today and in the future, markets - rather than governments- offer the best solution to local and global water problems.

Richard Tren, a water expert from South Africa, explains: "In South Africa, water was used as a political tool by successive governments that were keen to give favors to special interest groups. South Africa reformed its water system to allowed agricultural users to trade their water entitlements, resulting in huge gains in efficient water use."

According to Tren, "Water subsidies benefited the rich at the expense of the poor, who had to pay exorbitant prices for water that was trucked into townships."

Tren says that Chile's experience shows why markets promote access to clean water: "Water trading has increased access to clean and safe water for millions of rural and urban poor. When water was essentially privatised in Chile, municipalities were able to buy water from farmers, vastly increasing their ability to provide water to people."

Today in Chile, 99% of urban dwellers, and 94% of rural households now have access to clean water, 24 hours a day. This is in stark contrast to many poor countries, where, every year, women and children exert over 10-million person years of time and effort to collect and carry water.

Water scarcity is often used to justify government provision and allocation of water. However, Parth Shah, a water expert and economist from India, comments: "Under state ownership, water users - especially politically powerful users - do not pay the value of the water they consume. Such subsidies cause perverse incentives to waste scarce water."

Shah continues: "Establishing property rights and trading schemes will encourage markets and prices to develop for water, and will lead to more efficient water use, and fewer conflicts over scarce water resources."

Water markets are also good for the environment. Kendra Okonski, coordinator of the Sustainable Development Network, comments: "Water markets would reduce the need for costly and environmentally destructive dams in poor countries, and would free up capital for infrastructure such as pipes and sewage systems."

The Sustainable Development Network believes that water policies in all countries should focus on people who currently lack access to water. This means promoting property rights, eliminating regulations and subsidies, and freeing global trade in water.