Suez in Bolivia
In July 1997 the government of Bolivia signed a contract with Aguas del Illimani (AISA), a subsidiary of the French transnational corporation Suez, to run water and santition services in the cities of La Paz and El Alto, Bolivia. According to local organizations, the company failed to provide an adequate service to the citizens of La Paz and El Alto, leaving more than 200,000 people without water and sanitation services. After six months of negotiation and the possibilities of resolving the conflict without more persuasive means were exhausted, the Federation of Neighborhood Councils of El Alto (FEJUVE-El Alto), called an indefinite civil strike on January 10, 2005 demanding the cancelation of the concession contract.
On January 12, 2005, the Bolivian government emitted a Supreme Decree that initiated the termination of the concession contract with AISA, although this decree has still not been implemented and the company remains in Bolivia as of July 2006.
Part of the process included a “regulatory audit” which aimed to verify the degree to which the company met the conditions set by the contract.
The results of the final report, which were made public in the last few days, reveal that Aguas del Illimani did not comply with the conditions established by the two phases of the concession contract (1997-2002 and 2002-2007). Without a doubt, the results are disastrous for an international company that has profited from people‚ poverty in countries like Bolivia.
In order to obtain lucrative profits, the company has developed a new form of “private corruption”. Although the contract stipulated that the company should reach 100% potable water coverage for both cities within five years, in reality about one-fifth of the population of the Bolivia‚ poorest urban centre, El Alto, were left without access to drinking water. While the company was supposed to make 71,751 new connections in the first five years of the contract, the recent audit discovered that it only made 52,765. According to the results of the audit reported in the table on investment included in the “Análisis of the Audit of AISA” the transnacional company owes the government of Bolivia the aproxímate amount of US$6 million. Read the audit summary here.
AISA‚ failure to implement the actions stipulated by the Environmental Diagnostic in an appropriate and timely manner has also had a negative impact on the environment and on public health, especially children.