SERVICE (WATER)

Services that impact on daily lives (such as education, public utilities and health services) should have no place in trade agreements such as EPAs. These services should not be governed by trade rules. They are basic human rights that every citizen is entitled to whatever their social status.

The EU is pushing services liberalization because EU companies are the world’s major exporters of services and major investors around the world. Examples of European multinationals operating in Africa are banks like BNP or Barclays, supermarkets like Carrefour and Casino, water distribution and waste management companies like Vivendi. The EU’s many large service multinationals need to expand beyond the European markets to continue their profit growth. EPA negotiations will allow these profitable conditions for Europe’s multinationals and give them preferential access to ACP services markets.

While the ACP are in principle not obliged to start negotiations on services liberalisation, the EU and some ACP regions have started discussing the issue sometimes in controversial circumstances. Some ACP governments hope to attract more investment, or to export services provided by individuals such as nurses or low skilled labour because of their remittances. However, ACP countries are exporting in total so few services (1.5% of world exports in 2000) that liberalisation will make the ACP a net importer of services, which can create further debt.

The lack of preparedness of ACP to conclude negotiations and to implement EPAs is showed by several examples. During the liberalisation of water services in South Africa in ’90s, under the structural adjustments, water bills increase from 7 Rand (or 0,60 Euro) to 300 Rand a month (or 26,30 Euro) after arrival of Biwater and Suez. As French water company Suez installed prepaid water meters costing up to 1000 Rand (or 87,70 Euro) and charged up to 272 Rand (or 23,86 Euro) for 50 extra kilolitres, overall about 500,000 people have had water supplies cut off as they could not afford it. Because it is so complex to reap the benefits and avoid the negative aspects of services liberalization, African governments have been stating (April 2006) that they: “underscore the absolute need for a carefully managed sequencing of services liberalisation in line with establishment of strong regulatory frameworks. We therefore shall not make services commitments in the EPAs that go beyond our WTO commitments and we urge our EU partners not to push our countries to do so.”