Bolivia: Privatized Water Company Defeated

September 25, 2007

On January 10, members of more than 600 neighborhood organizations in the Bolivian city of El Alto mobilized in an open-ended peaceful civic strike to press a series of demands, including the cancellation of the city’s water and sanitation contract with the private consortium Aguas del Illimani. The protests ultimately led to the annulment of the contract.

The Federation of Neighborhood Associations (FEJUVE), which organized the strike, says the water company charged rates that put water and sewer service out of reach for a majority of El Alto residents.

The water and sewer system of El Alto was privatized to Aguas del Illimani in July 1997 when the World Bank made water privatization a condition of a loan to the Bolivian government. The Aguas del Illimani consortium is owned jointly by the French water giant Suez (formerly Suez Lyonnaise des Eaux) and a set of minority shareholders that includes the International Finance Corporation (IFC) of the World Bank.

El Alto residents say that by pegging rates to the U.S. dollar, the company raised water prices by 35%. A water and sewer hookup for a single household exceeded $445, while many Bolivians earn about $2.50 a day. The company had also failed to expand water service to the outlying areas of the municipality, residents complain. The latest population census showed that 52% of El Alto residents lack basic water and sewer services.

FEJUVE called the strike for January 10 after five months of protests and negotiations failed to win a solution to El Alto’s water crisis. “The ‘Bolivianization’ of the rates is a promise from November of last year,” complained FEJUVE president Abel Mamani Marca. “Now they want to talk about expansion of the service, but they don’t say anything about non-fulfillment of the contract terms or of irregularities in the bidding for the concession. Aguas del Illimani has not complied; they have to go,” he said.

Thousands of El Alto residents hit the streets and set up road blockades that cut off traffic in and out of La Paz, shutting down the city’s international airport, which serves as the capital’s main airport. The government tried to convince El Alto residents to halt their strike by decreeing a series of economic measures to encourage investment in El Alto.

In the outlying neighborhoods of Ballivian and Alto Lima, which lack water and sewer hookups, residents seized several Aguas del Illimani facilities, including a water tank. On January 11 Bolivia’s President, Carlos Mesa, sent FEJUVE a letter, saying he was beginning “the necessary actions for the termination of the concession contract” with Aguas del Illimani. The heads of the neighborhood associations met at FEJUVE headquarters to discuss the letter, but they decided to continue their strike. They gave Mesa’s government 24 hours to promulgate a decree immediately canceling the contract with the water company. Shortly afterwards, a government official called Mamani to tell him the decree would be ready the next morning.

On the morning of January 12, as El Alto remained paralyzed, the government gave FEJUVE an unsigned decree, prompting the neighborhood associations to convene another assembly. FEJUVE rejected the new decree, saying it needed to make clear that Aguas del Illimani would leave Bolivia “immediately.” Later that night the government added the language demanded by FEJUVE. After each neighborhood association had a chance to discuss the document with its members, FEJUVE called an end to the strike, but warned that its members would remain on alert to make sure the company did not remove any equipment from its facilities and would continue pressing other demands. “Electropaz is next,” activists warned, referring to the electricity company for El Alto and La Paz, operated by the Spanish transnational Iberdrola.

Aguas del Illimani is the second transnational water company to have a contract annulled in Bolivia. The first was Aguas del Tunari, a consortium led by Bechtel, in the city of Cochabamba.

Meanwhile, nationwide protests continued against another government decree that instituted price increases of 10% for gasoline and 23% for diesel. The eastern city of Santa Cruz has been the flashpoint of these protests. After road blockades, a civic strike and an eight-day hunger strike called by the Santa Cruz Civic Committee, the government convinced the Civic Committee to begin a dialogue mediated by the Catholic Church. Some campesino and indigenous organizations in Santa Cruz department rejected the strike, accusing large-scale farmers of using it to try to destabilize the country’s democratic system.

The Santa Cruz Civic Committee is allied with other groups in the east of Bolivia that seek greater departmental autonomy. A government-sanctioned process to evaluate the autonomy issue was underway, but the fuel hikes led many groups to radicalize their positions and demand that the government weigh the autonomy question immediately [See “Bolivia’s Separatist…” p. 16].

Amid the intransigence of the Civic Committee, even President Mesa’s would-be opposition groups rallied to his support. Evo Morales of the Movement Toward Socialism (MAS) characterized the groups behind the protests as “oligarchic sectors who use the people of Santa Cruz with the intention of creating further national divisions.”

About the Author
Weekly News Update on the Americas is published by the Nicaragua Solidarity Network of Greater New York. For subscription information visit:


Like this article? Support our work. Donate now.