Privatization Watch - 08/2017

21 December 2017
Latest issue of #PrivatizationWatch (08/2017) - The Global newsletter on privatization of public services around the world.

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Migrants Day Statement

Countries provide welfare and administrative services for asylum seekers and refugees but increasingly, they have been subject to privatization and other forms of Public –Private Partnerships (PPPs), like other public services. In some countries, the privatization of these services has been taking place for long enough to show not only the poor quality of services and working conditions but the long term effects of privatizing services which were traditionally part of welfare services.

The recent increase in refugees has also led to new business opportunities for companies, many of which are providers of other public services such as prison services or social care.

This report by Jane Lethbridge of PSIRU, commissioned by Public Services International (PSI) and the European Federation of Public Service Unions (EPSU), examines the effects of the privatization of services for refugees and migrants at national and international level.

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Help decide: who should own public transport?

The ITF and We Own It (an organization that campaigns for public ownership in the UK) are working together on a People’s Public Transport Policy as part of the ITF's Our Public Transport programme.

We need your help to create an excellent policy! 

Can you think of examples of successful publicly-owned transport in your country or around the world? Can you think of any – or have you worked on - successful campaigns to bring transport into public ownership? Why is public ownership important to you? Give your answers to these questions in the short survey: https://weownit.typeform.com/to/qkk2ZO

Please share your knowledge and experience by filling in this short survey, and sending it to your members, by 14 January 2018

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Public Good over Private Profit

The Global Campaign for Education has produced a new toolkit on the privatisation of education titled “Public Good Over Private Profit”. The toolkit offers practical guidance for national education coalitions, teacher unions and civil society activists around the world to campaign against the privatization of education. These resources will be helpful for those who are interested in challenging privatisation and rebuilding confidence in the financing of quality public education.

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Beware Public Private Partnerships

Since the late 1990s, many countries have embraced Public-Private Partnerships for areas ranging from healthcare and education to transport and infrastructure as a solution to persistent underdevelopment. Nevertheless, experiences with PPPs have been largely, although not exclusively negative, and very few PPPs have delivered results in the public interest. Writes Jomo Kwame Sundaram a prominent Malaysian economist and former United Nations Assistant Secretary-General for Economic Development in the United Nations Department of Economic and Social Affairs (DESA).

 

AFRICA AND ARAB COUNTRIES

 

Africa/India

Indian private sector consultants promoting “public private partnerships” are fanning out to Africa, West Asia and elsewhere. “PPP (public private participation) is a new animal for countries in West Asia. Most projects were till now fully government-funded, but with the crunch in resources, PPP is catching up fast. Many of these countries are hiring Indian consultants for both PPP and full privatization projects. Besides infrastructure, other sectors in focus include education, health care and transport. ‘It works, as they have never explored PPP as an option of infrastructure development,’ says Abhijit Bhaumik, a senior consultant with 26 years of experience who worked with firms like Feedback and others before going it alone. Bhaumik says that he spends most of his time in Tanzania and is soon starting a new project in China. In the last four to five years, he’s worked in Bangladesh, Kenya, Indonesia and Vietnam.”

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Benin

Government economic reforms are targeted by public sector workers, saying “we are not against the development of our country. But the reforms initiated by President Patrice Talon are sudden and suicidal for the people of Benin, with its waves of privatization of public companies and thousands of employees layoffs.” The Coordinator of the Inter-health Human Resources (IRHS), Adolphe Houssou, said “we cannot allow the government to privatize the country's hospitals and public health centers. In the Benin Constitution of 11 December 1990, the State has the duty to guarantee health care to people of Benin. Already with the management of State, less than 51% of Beninese attend centers and public hospitals. But when these structures will be privatized, what will be the fate of thousands of Beninese currently living below the poverty line!

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Ghana

Workers are demanding a severance package before the planned privatization of the Electricity Company of Ghana. The Public Utility Workers Union (PUWU) “is disappointed and surprised by the lack of engagement that has been demonstrated by the present government with respect to key labour issues on the Private Sector Participation under the Compact 2 which is a sharp contrast to promises made to them by the President during the 2016 campaign. According to him, the labour laws define clearly that whenever there is going to be an arrangement or amalgamation causes ‘severance of the legal relationship of worker and employee as it existed immediately before the close down, arrangement or amalgamation,’ the worker is entitled to be paid by the employer, referred to as ‘redundancy pay.’”

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Madagascar

An inter-union strike has been ongoing since August 10 at JIRAMA, the national water supply and electricity company. Workers are protesting dismissals and the threat of privatization. The general manager denies that it will be privatized, but the union has been demanding the resumption of “social dialogue.”

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Namibia

Fitch Ratings sees more privatization in 2018. “The Public Enterprise Governance Act Amendment bill will streamline the institutional framework of state-owned enterprises (SOEs). Its approval in Parliament is likely in 2018. The reform may reduce government transfers to unprofitable public companies and also paves the way for a possible partial privatization of some state assets, notably the telecoms operator MTC.”

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Niger

Veolia is weighing in again to market its water privatization business as the solution to Niger and Africa’s urban infrastructure challenges. “Co-creation” is its new mantra. “The leasing contract remains,” according to the company, “one of the ‘new’ most suitable contractual models to the African context.” But experience on the ground paints another picture. In India, “reality was quick to catch up with the French water companies and their Indian partners. There has been strong resistance to water privatization both from civil society and within the bureaucracy. Several dubious financial transactions have been exposed, as well as, more generally, a widespread collusion between political and economic interests. (…) Finally, despite the usual stereotypes about the alleged superiority of private management, Suez and Veolia quickly became entangled in multiple technical and operational difficulties on the ground. They found exactly the same problems that have hindered the development and operation of successful public water services in Indian cities—plus the disadvantages of their own inexperience in India and of the new requirement to siphon out money from the water service for the benefit of their shareholders and (legally or not) of their local partners.”

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Nigeria/Africa

Twenty young African trade unions leaders gathered in Abuja recently to discuss remunicipalization, PSI reports. “This meeting was the opportunity to discuss collectively the many reasons why it is key to defend the public ownership of essential municipal services, how to ensure fair public procurement processes and why it is in everyone’s interest to reclaim them for the public whenever they are contracted out to the private sector. Profit-oriented service procurement is not compatible with the general interest and the young trade union leaders uncovered many reasons why essential service privatization does not work for people.

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Nigeria

ActionAid has unveiled a report on Bridge International Academies, the education privatization company, and is urging the Nigerian government to beware of the proliferation of for-profit schools. ActionAid country director, Ojobo Ode Atuluku said “policy inconsistencies and lack of an integrated national development planning framework have combined to produce the current scenario of the decay in education in general and public education in particular. The privatization of education has failed and has been shown to be unable to deliver universal access to quality functional and productive education.” [Report: Whose children go to the Bridge International Academies?]

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Nigeria

The crisis of the electricity distribution companies (DISCOs) seems to be finally turning government views on the need to rethink privatization. The Minister of State for Budget and National Planning, Mrs. Zainab Ahmed, has admitted “the power sector has been privatized but I’m sure every Nigerian can attest to the fact that the privatization has not worked well, in the sense of what we sought to achieve in terms of power efficiency… We have now come to the point where government which is a stakeholder in the power sector and other stakeholders must come together and decide and cede some of their holdings to new investors that will inject new funding; investors that have the expertise to grow the power sector that will serve Nigerians.”

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Nigeria

The Federal Government is aiming to generate N311bn [ca. US$863mn] from the privatization of public properties and the sale of national assets next year to partly finance the 2018 budget. The Minister of Budget and National Planning, Udo Udoma, “added that the Federal Government would continue to leverage private capital and counterpart funding for the delivery of infrastructure projects. The minister said for the 2018 capital projects, the government would carry out huge projects in transportation; power, works and housing; health; water resources; agriculture and rural development; mines and steel development; industry, trade and investment; and education, among others.”

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Oman

The sell-off of Oman’s municipal waste system to foreign companies is nearing completion. “The Oman Environmental Services Holding Company (Be’ah) is close to completing the transfer of waste management operations in each of its 11 governorates to international operators. (…) Companies that have been awarded contracts include Spain's Urbasar, which is currently working for South Batinah governorate; Dubai-headquartered Averda, which won the contract to manage Dakhliyah and Dhofar; and a joint venture between Oman's Al Ramooz and France's Veolia for operations at Dhahirah and Buraimi.”

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Senegal

Cheikh Diop, general secretary of the National Confederation of Workers of Senegal/Force of Change (CNTS / FC) has denounced the delay of September salaries of Dakar-Bamako Ferroviaire (DBF) workers. "The State of Senegal is the main [one] responsible for this situation, for having piloted the privatization of the former Transrail, which gave birth to DBF,” said Diop.

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South Africa

POPCRU, the Police and Prisons Civil Rights Union, says public services need a tough anticorruption drive, not privatization. “With the emerging allegations about the looting of state owned enterprises and the continued retrenchments of workers, it is clear that their underperformance is mainly due to corruption that has penetrated deep into the state. We cannot accept that workers are made to suffer through losing their jobs or forfeiting salary increases in the midst of the constant increases in prices of basic needs, while some within these enterprises are let off. Our call on our government to start taking harsher measures in dealing with the shortcomings that have expressed themselves in these sectors not by way of privatization, but by ensuring their credibility and integrity is returned.” COSATU has said “the plans by government to privatize state assets without consulting social partners and stakeholders will backfire. COSATU will not support privatization as this will see permanent decent jobs scrapped in favour of labour brokers and will also wreak havoc and compromise workers' salaries, job security and pensions.”

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South Africa

Equal Education, a community and membership-based organisation that advocates for quality and equality in the South African education system and a staunch opponent of privatization, criticizes some of the recommendations of a commission appointed to study the issue of student fees and access to education. “The suggestion that [the South African Revenue Service] SARS as a public state body will collect funds on behalf of the private banking sector is a serious cause for concern, as a state body which is accountable to the public would be acting in the interests of private profit-making corporations.” EE also says the Fees Commission’s “proposal to replace a state-run loan system (NSFAS) with a loan system run by a public private partnership (PPP) ignores the repeated and legitimate calls for education to be made accessible without binding conditions.”

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Uganda

The FitchGroup’s BMI research gives Uganda high marks for east Africa but low marks by global standards in its “Economic Opennness” report, noting “extensive privatization programmes by the government have opened up industries that were formerly closed to the private sector, such as infrastructure.” BMI says “while the Ugandan government has been on a privatization drive since 1993, dominant state-owned players still operate in [oil and gas, water services, power and agriculture]. Given the high levels of corruption in the Ugandan government they are likely to receive preferential treatment in terms of access to land at specific rates.” Land privatization will be an important issue, says the rating company. [BMI Research, “Economic Openness Analysis—Uganda—Q4 2017,” 17 October 2017]

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Uganda

Muwanga Batuuka, writing in the Daily Monitor, says “the mismanagement and privatization of public services have diminished access to education, healthcare and other opportunities generally, which has given rise to biting poverty. Couple that with incompetence and you begin to scratch at the big mess Uganda faces today.”

 

ASIA AND THE PACIFIC

 

The People’s Inquiry into privatization launches new report on how privatization affects communities and calls for a moratorium on privatization until greater regulatory mechanisms and proper policy frameworks are implemented around the delivery of public services. Taking Back Control: A Community Response to privatization says, “the aim of the inquiry, chaired by David Hetherington, is to begin a conversation about the issue of privatization in all its forms—including outsourcing, social impact bonds, user-pays, vouchers, commissioning, etc.—and build consensus around an alternative vision for our public services. We need to put forward our vision for the role of government in service delivery, what kind of public services our community needs, and ultimately, what kind of society we want to live in.” The report gives details on the harm produced, for example, by the privatization of New South Wales public disability services. The Australian Services Union says “essential services are best provided direct by government.”

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The Asia-Pacific region faces an airport infrastructure crisis, but privatization is not the answer, says Alexandre de Juniac, head of the International Air Transport Association. “While a number of airports have plans in place, de Juniac said others such as Bangkok, Manila and Jakarta are among those that need major upgrades. He also said Chinese air traffic management is struggling to cope with growth, while high costs at India's privatized airports are burdening the industry. De Juniac also warned against seeing privatization as the solution to fund infrastructure investments. ‘We have no issue with injecting private sector mentality into the operation of any airport,’ he said. ‘But our conclusion from three decades of largely disappointing experiences with airport privatization tells us airports perform better in public hands," said de Juniac.”

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Australia

Labor’s Shadow Minister for Human Resources, Linda Burney says “privatization of aged care and hospitals and attempts to go the same path with social security [are] appalling and not the way for governments to do business. ‘It’s the responsibility of government to give people a hand-up.’”

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Australia

Public Service Association general secretary Troy Wright says it's time to return Parklea jail to public hands. “‘If you stay with a private provider it's going to be more of the same with a different name,’ Mr. Wright told AAP on Monday. ‘It has to be returned to the public sector. That is the only provider that could run Parklea Correctional Centre viably, responsibly and safely.’” The GEO Group is currently in the process of having its operation of the scandal-ridden jail terminated.

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Australia

Michael West investigates the consultant gravy train driving the New South Wales privatization process. “Here are a few of the rippers. The ‘Disability and Customer Care Services Transfer,’ read flogging of the state rights to care for disabled people, and an $830 million property portfolio, demonstrates EY suffers no disability when it comes to fee-charging. It picked up $5.5 million, then a further $4.5 million, while mining investment bankers Ironstone Capital Advisory raked in $3.9 million and $3.2 million. That deal is ongoing. The biggie was the sale of the NSW electricity transmission and distribution assets, some of which went off to the Cayman Islands. This one is dubbed ‘Electricity Generation Assets Project.’ Goldman Sachs, which can’t even file a proper set of financial statements in this country, got $4.6 million for financial advice, KPMG $4.4 million for tax and accounting advice and Baker & McKenzie $5.9 million for lawyering.”

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Australia

Unions are battling the privatization of New South Wales disability services. A forum was hosted by the Public Service Association and the Community and Public Sector Union. “PSA industrial officer Kris Cruden said all other states except NSW were retaining some sort of disability services, but everything in NSW would disappear at the end of June 2018. Ms. Cruden said the Newcastle forum was planned as the first of a series around the state. The forum heard some people, especially those with persuasive advocates, had done well out of the NDIS, but PSA president Kylie McKelvie said a recent ABC 7.30 report about a profoundly disabled Victorian man ending up in prison showed what was happening when things go wrong.”

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Australia

Blue Mountains MP Trish Doyle is concerned about “the ideological privatization agenda and cuts to TAFE, coming from government, and being driven by the higher management tier.” The technical and further education program is supporting a “course at Wentworth Falls which was specially designed this year to help post Year 12 students living with disabilities.”

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India

The Water Transport Workers’ Federation of India is resisting the central government’s efforts to privatize the Dredging Corporation of India (DCI). ““The government’s decision is hasty. We fear it will pave the way for cartelisation of private Indian and foreign dredging firms to loot major ports,” the federation said. For the record, DCI had a big role in the building of the International Container Transshipment Terminal (ICTT) at Vallarpadam operated by Dubai Ports World as a BOT project under an agreement with the Cochin Port Trust. The federation also said that at a time when private firms had abandoned dredging work, it was being awarded to DCI.”

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Indonesia

A massive water privatization program is to end in Jakarta after 18 years. The Supreme Court has ruled that “two private water companies inadequately served the residents of the world's second-largest metropolitan area. Jakarta's water utility was privatized 20 years ago in the last years of the Suharto military dictatorship, when the former president awarded contracts to two joint ventures, one of which included his son's company. A coalition of activists, trade unions and Jakarta residents filed a class-action lawsuit in 2012 claiming that the companies failed to guarantee people's right to clean water. The companies both engaged in price differentiation that disproportionately taxed low-income residents and afforded them huge profits. The coalition won its case in the Jakarta District Court in 2015, but it took two more years for the Supreme Court to uphold its constitutionality.”

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Indonesia

Are private hospitals inhibiting the WHO-mandated right to health care? In Indonesia, “access and standards of healthcare is far from the same for everyone. Recently, reports emerged of a baby who died in a hospital in West Jakarta because the family couldn’t provide the down payment needed for intensive care. The patient had a BPJS card but the hospital was a private hospital unaffiliated with BPJS, reinforcing the limits to the ‘universal’ program.”

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Japan

The government has kick-started the privatization of Hiroshima airport, part of a program to privatize nine airports across the country. “A consortium comprising Orix Corporation, Vinci Airports and Kansai Airports will run Kobe Airport for 42 years, under a $171 million contract, while Takamatsu Airport will be managed by a team comprising Mitsubishi Estate, Taisei Corporation, Pacific Consultants and Symbol Tower for up to 55 years.”

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New Zealand

The new government headed by Labour leader Jacinda Ardern is expected to reverse school privatization trends. “Reactions among education groups ranged from celebratory champagne breakfasts to anxious uncertainty about who will fill ministerial roles and the policies they might pursue—or have dropped—following the coalition negotiations. (…) Teachers' unions and other professional bodies, so far in the dark about the new government's plans, were anticipating big changes in education based on common ground in the parties' policies and Labour's election campaign to ‘put the 'free' back into free education.’ Charter schools and National Standards are out, to the joy of teachers' unions that have spent nine years railing against what they saw as chronic underfunding, growing privatization, and the devaluing of the teaching profession under National.”

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New Zealand

The Greens have forced a rethink of the policy of privatising public housing. “The Greens are committed fixing our rundown public housing and building significantly more public dwellings. We have said repeatedly that the Labour government's plan to sell off public land to private developers does not provide enough additional public housing, and only benefits property developers at the expensive of public housing tenants and our community,” said Greens housing spokesperson Ellen Sandell.

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Pakistan

Workers in Lahore have rallied outside the Punjab Assembly to protest “against privatization of the health sector,” as they “believe the privatization of hospitals will be the final nail in department’s coffin. Scores of women also took part in the protest. Earlier, they gathered outside office of the health department’s director and later started marching towards Charing Cross.”

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Philippines

The government says it is going to take on more risk in order to speed up ‘public private partnership’ projects. “We are not willing to wait for the private sector to settle their differences. While private companies quarrel among themselves as to who will make the profit, the public suffers from lack of infrastructure. The Duterte administration is willing to take the construction risks and spend budgeted funds to start projects early,” Finance Secretary Carlos G. Dominguez III said.

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South Korea

Reports have surfaced about abusive treatment of nurses at a private hospital in Anyang, Gyeonggi Province. “The Ministry of Employment and Labor will investigate a university-affiliated private hospital at which nurses were pressured to perform a suggestive dance in revealing clothes during a sports event.”

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Thailand

The government is privatising the operations of some public schools. “A private operator would be allowed to run a school for five years with appraisals of its work being conducted on a regular basis, Mr Chaiyapruek said. These private operators, he said, must not be profit-seeking entities. (…) A total of 77 pilot schools could come under the scheme in the first semester of next year.”

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Thailand

The cabinet has approved a modified ‘public private partnership’ plan. “The projects in which the government can form joint ventures with the private sector include city rail mass transit, toll projects for rail projects in urban cities, roads, ports and high-speed rail that require private investment. (…) Projects the government wants to promote using joint investment include telecom networks, high-speed internet, intercity toll roads, large-scale convention centre development, and residential development for low-income earners, the elderly, the handicapped and the underprivileged.” Fast track projects are already moving ahead for transit and a motorway from Bang Pa-in to Nakhon Ratchasima and another from Bang Yai to Kanchanaburi, and for a PPP roadside rest area.

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Thailand

The government is finalising the model and regulations for public-private partnerships (PPPs) in the Eastern Economic Corridor, and will soon submit them for approval to the EEC board, chaired by the prime minister. “A key question is the proportion of investment between the government and foreign investors. EEC Office secretary-general Kanit Sangsubhan said the government is accelerating the draft of the PPP model to be applied to infrastructure megaprojects in the EEC, particularly the five major projects linking the EEC to the world.”

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Vietnam

PPPs are being aggressively promoted by APEC. The mobilisation of long-term capital from the private sector for infrastructure projects, especially protection of interests and risk mitigation for private investors in public-private partnership (PPP) projects, is one of the four priorities initiated by Vietnam in the APEC 2017. “Experience of international organisations and APEC member economies in handling PPP projects, especially risk sharing between the state and private investors was one of the discussion topics at the Finance and Central Bank Deputies Meeting (FCBDM), the Senior Finance Officials Meeting (SFOM) and the Workshop on Long-term Investment in Infrastructure (May 2017). APEC Senior Finance Officials had discussions with international organizations on effective instruments for project management and concerted training activities for project managers in APEC member economies.”

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Vietnam

The government is moving ahead with its plans to privatize major companies, including Sabeco, the country’s largest brewery, the dairy firm Vinamilk, Vietnam Airlines and rival brewer Habeco.

 

INTER-AMERICAS

 

Antigua and Barbuda

After the devastation of Hurricane Irma, the government is contemplating widespread privatization, which critics say will benefit big commercial landholders. “Barbudan activists say their misery is being exploited in an opportunistic land grab.” IRIN reports, “The central government of the twin island nation of Antigua and Barbuda is proposing a form of land privatization. Prime Minister Gaston Browne says the minority population of Barbuda can’t properly rebuild and develop without introducing private land ownership. Speaking to IRIN, veteran Barbudan politician and activist Hilbourne Frank said the Antiguan-dominated government is using underhand methods ‘to compel’ privatization in the wake of the hurricane. This means ‘serious trouble,’ he said, and will threaten the cultural heritage of the island as well as Barbuda’s long-standing autonomy. ‘In the end, we are going to be controlled by other people,’ he argued.”

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Bolivia

Privatization cost the country billions. “The legislative commission investigating the privatization and Capitalization process between 1985 and 2005 concluded, among other things, that Bolivia lost at least $10 billion for the disposal of 212 public companies.”

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Brazil

The privatization of the state-owned power distributor Eletrobras Group, which would cut the public stake in the company from 63% to less than 50%, is expected to raise US$ 2.43 billion for the government. Private companies will be limited to a 10% share of the group, and “expects to conclude the Eletrobras sell-off by mid-2018.” Petrobras workers have described the privatization plans as “evil packages.” Critics from the opposition Workers' Party “have denounced the move as one of many neoliberal austerity measures implemented by Temer’s government. His administration claims privatization will tackle the country’s public spending deficit of almost US$50 billion. Lindbergh Farias, a Senate PT leader, slammed the sale of Eletrobras as ‘a crime against the nation.’”

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Brazil

The Spain-based company GS Inima, part of the South Korean conglomerate GS group's engineering and construction arm, wants to expand its business in Brazil beyond sanitation services. “GS Inima wants to take part in the construction of sanitation projects in Brazil, in operations that involve both water distribution and sewage collection. In addition to participation in bidding processes and privatization of water and sanitation services, the company is also interested in acquiring concessions from other companies in order to expand its activities across Brazil.”

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Brazil

Under Mayor João Doria, São Paulo is pushing ahead with privatization. “In September, city legislators approved major privatization, concession and public-private partnership (PPP) programs. Doria is planning to privatize the Interlagos motor racing track and the Anhembi events complex, along with launching tenders for a concession for the Pacaembu sports arena, parks across the city, and even cemeteries. Doria's administration also plans to award concessions for 27 bus terminals.” But experts are opposing the plans. “They are selling national patrimony for the price of a banana,” says Esther Dweck, a professor of economics at the Federal University of Rio de Janeiro, using a common Brazilian saying.

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Canada

The Canadian Union of Public Employees set out its strategic plan for 2017-2019 at its national convention, held in early October. “CUPE plays a leading role in fighting for high quality public services and publicly-owned infrastructure, and against privatization through new arrangements like ‘social financing,’ ‘asset recycling,’ ‘leveraging’ through selling off public utilities, and public-private partnerships. We are committed to keeping our members’ pension funds from investing in or profiting from P3s in Canada and anywhere in the world. We will continue to oppose all privatization plans, including the Canada Infrastructure Bank, an institution that will funnel millions in subsidies to corporations banking on large private profits from public infrastructure projects.”

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Canada

With talks on revising NAFTA opening in November, CUPE National President Mark Hancock wants to make sure public services are protected from “proposed changes that would let US corporations sue Mexico and Canada, but prevent Canadian or Mexican companies from suing the US government. (…) Eliminating Chapter 11 is just one of the changes CUPE is pushing for, to help workers and protect public services and the environment in all three NAFTA countries.”

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Canada

A pilot program that will bring private autism therapy operators into public schools is raising concerns. “We represent 13,000 Educational Assistants who work hard, with other Board employees and parents, to develop and deliver individualized educational programs to assist students with multiple challenges, including those with autism,” said Terri Preston, Chair of the CUPE Ontario School Board Coordinating Committee. “They are deeply concerned by any initiative that opens the door to the privatization of those critical services in our schools.”

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Canada

CUPE is calling attention to shortcomings of the Canada Infrastructure Bank. “Municipalities are responsible for more than half of our country’s core public infrastructure, but only collect 12 cents of every tax dollar. The need for direct federal funding support is clear. But the new Canada Infrastructure Bank (CIB) will not close this gap. Instead, its expensive private financing will drive up costs for municipalities, lead to new or increased user fees and tolls, and shift planning, ownership and control of public facilities to private, for-profit corporations.”

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Costa Rica

Opposition lawmakers appeal a new water law to the Supreme Court, saying it will set the stage for water privatization and reduce the role of citizens in decision-making. The law “redefines water resources as an ‘economic good,’ which has provoked concerns from both environmental groups and the private sector. The law would principally affect the country's hydroelectric, agricultural, and industrial sectors as the highest commercial consumers of water, and will potentially increase environmental sensitivity to projects using large volumes of water, such as the US$2.5-billion El Diquís Hydroelectric Project in Buenos Aires, Puntarenas, which has been stalled since 2011 due to indigenous opposition. The law's passage will depend on a favourable Constitutional Court ruling, and subsequently on its prioritisation amid other urgent legislation ahead of the February 2018 presidential election.” [IHS Global Insight Daily Analysis, 15 November 2017].

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Jamaica

The government is moving to privatize solid waste management services, says Prime Minister Andrew Holness. “‘There is an estimated one million tons of waste that is produced annually, of which it is said that 50 per cent is organic material and provides a viable basis for the economic sustainability of a PPP,” said the Head of the Enterprise Team, Lyttleton Shirley. He also said that some policy and legislative changes may be required to support PPP structure. Shirley said that before mid-2018 the enterprise team would be able to recommend more specifics to the Government about a PPP transaction ‘that will be employed to select a reputable private investor to design, build, finance, maintain, and operate the waste collection, transportation and treatment services in a holistic manner, while providing some residual revenue to the Government.’”

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Latin America​

Unions from 19 Latin American countries assembled in Belo Horizonte, Brazil to fight for public education and against privatization. “Angelo Gavrielatos, director of EI’s Global Response to privatization and Commercialisation in and of Education project, said that EI’s research had exposed the very harmful effects of commercialisation on education. EI’s advocacy with international agencies and national governments was bearing results, he added. Gavrielatos also highlighted how education unions in Uganda, Kenya, and the Philippines have successfully mobilised public opinion against the spread of for-profit schools in their countries.”

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Mexico

The head of the Ministry of Health, José Narro Robles, denies he is out to privatize the public health system. “I say with all [my] strength, there is no interest in PFS in favor a privatization process of the public health institutions. There is not. I say [this] bluntly, understanding that I am under oath to tell the truth.” But “criticism from lawmakers focused on budget cuts that the sector has received so far in six years, which exceed 40 billion pesos. They also highlighted concerns about the proposal to universalize the public health system, which could lead to its privatization. (…) Senator Fernando Mayans (PRD) said that they will not let you privatize the health of this country.”

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Mexico

The Movement in Defense of Land and Territory and the Participation and Recognition of Women In Decisions says “people recognize that part of the female gender will double the force [of] struggles against privatization, extractive investments, discrimination and state violence against community life.”

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Mexico

In the midst of a crisis in the state and federal prison systems, Ruth Villanueva Castilleja of the National Human Rights Commission “indicated that the privatization of prisons is not the solution to improve the system; on the contrary, [she] emphasized that there must be political will [to] eradicate corruption to correct the conditions of many of these centers.”

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Mexico

Critics call attention to the fact that the national executive wants to direct 36% of the budget of the National Water Commission (Conagua) to only three megaprojects, shortchanging local infrastructure, water and sanitation. “In addition, there are works by companies whose partners were identified as beneficiaries in tax havens, said the national coordinator of Water For All. At a press conference at the gates of the Chamber of Deputies, representatives of the organization argued that the 2018 budget would deepen the severe cutback of 72 percent in the amounts allocated until 2017 to water systems and sanitation, which is in violation of the human rights and seeks to induce water privatization.”

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United States/Puerto Rico​

As the saying in the P3 world goes, “desperate government is our best customer.” The Bond Buyer is reporting that the storm-ravaged island is “working on six public private partnership projects that would lead to $300 million to $400 million of investment in projects ranging from a hydroelectric dam to student housing. Puerto Rico will seek requests for qualifications for three of the projects and it is already working with companies on the other three.” Big projects seem to be in the lead: “Three private sector entities presented unsolicited proposals in the energy sector. One proposal was for a hydroelectric dam that, the government said, would make the island’s electrical generation more flexible and would lower electrical prices.”

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United States​

With the U.S. Veterans Administration facing massive staff shortages, VA workers are concerned that siphoning funding off to private providers will hobble efforts to improve the VA itself. “VA employees feel they are uniquely trained to handle veterans. Lee says they believe that they understand the veterans' needs, but adds that she doesn't think the private sector will do as well. ‘We want the money coming back into the VA for our veterans, so we can hire more resources to give them better care,’ Looney says. ‘They served for us; it's time for us to give back to them.’” At its just-concluded convention, the AFL-CIO has vowed to fight privatization. “This is a deliberate strategy: Establish the basics of a privatization plan—they call it Choice—and they keep throwing more and more money at it and encourage veterans to use it instead of the VA,” AFGE National President J. David Cox Sr. said in his AFL-CIO address. [AFL-CIO anti-privatization resolution]

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United States​

A for-profit prison company, the GEO Group, has asked a federal judge to dismiss two lawsuits challenging its practice of paying inmates only $1 a day for tasks such as janitorial or kitchen work. Washington State’s minimum wage is $11 an hour. “The Washington Attorney General’s Office argued that it is entitled to enforce the minimum wage law against GEO just as it’s entitled to enforce it against any other company in Washington. While the state has determined that its own prisons don’t have to pay inmates minimum wage, it’s made no such determinations about private detention facilities, said assistant attorney general Marsha Chien.”

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United States​

Efforts by conservatives to privatize health care for low-income people have led to crises in care delivery in Iowa and Kansas. Iowa’s privatized Medicaid system continues to face enormous problems “as over 200,000 Iowans are being forced to switch companies that manage their health care in less than 30 days. The huge change comes after AmeriHealth Caritas, one of the three for-profit companies managing Medicaid privatization, announced it was withdrawing from Iowa on December 1 after losing hundreds of millions in Iowa during the last year and a half. Currently, AmeriHealth manages the health care of nearly 215,000 Iowans.” Public service unions warned that this would happen before Iowa Republicans forced through the changes.

 

EUROPE

 

Belarus

The German private sector promoted ‘public private partnerships’ in Belarus at a recent conference in Minsk. “The international conference [was] organized by the international law firm Arzinger & Partners and the German-Belarusian economic club. A co-organizer of the event [was] the state institution National Agency of Investment and privatization. The main goal of the conference [was] to support PPP development in Belarus through the demonstration of modern and widely used German approaches and PPP project implementation practices that will help expand economic cooperation between Germany and Belarus.” Hovsep Voskanyan, chairman of the board of the German-Belarusian Economic Club, says German experts are “expected to make recommendations for reforming Belarus’ regulations governing public-private partnerships.” [BelaPAN Online, 25 September 2017]

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Bulgaria

The parliament has approved on first reading legislation to tighten up privatization and post-privatization oversight. “The bill’s stated goal is to increase public control over the privatization of certain companies of great importance for Bulgarian economy. Deals on such companies or their assets will have to be approved by the Parliament.”

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Croatia

A conference was held in parliament “to investigate if privatization is the only way to improve the management of big public systems in the country such as the HEP power provider or the healthcare system, or if there are other innovative models that could improve their management as well as ensure their sustainability.” Sandra Bencic of the Centre for Peace Studies “said that access to public services such as healthcare, education and power supply was one of the key levers for not only fighting poverty but also surviving it, especially given the fact that more than one million people in Croatia live at risk of poverty or social exclusion.” Hajdas Doncic said that one should work on raising public awareness of the importance of the management of public systems because ‘the only thing worse than public monopoly over public resources is private monopoly over them.’”

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France

A wave of housing privatization may be coming. “If the president gets his way, he could usher in a period of privatization, and redirect the EURO 40 billion the French state pumps into five million subsidized housing units every year.” Rolf Buch, chief executive of the real estate company Vonovia, is eagerly waiting to see what Macron will do. “The outcome is open. We will also look at the Netherlands and Sweden.”

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Germany

Corporations will be pressuring the government to sell off stakes to fund broadband expansion. “Pro-business politicians have long urged the government to step in and fund the upgrades instead, using proceeds from selling the government's remaining shares in formerly state-owned firms, including Telekom, the post office or the railroads. But a full privatization of those firms has been blocked for the last eight years by the Social Democratic Party, which was part of the ruling coalition. Now that the Social Democrats are not in talks to join the next government, privatizations are considered likely to go forward.” But that may not in fact go to broadband expansion. “The politicians may be in for a shock when they sit down with Finance Ministry officials in hopes of spending the money from privatizations on new projects. Germany adopted a constitutional amendment called a debt brake in 2009 that sharply limits the size of government debt. One provision of the law is that money raised from privatizations must first be used to payoff the government's existing EURO 2.1 trillion debt.”

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Germany

A warning strike by ver.di leads to a negotiated settlement with Suez Süd waste company. The pay agreement runs until the end of 2018. “It was important to us to enforce a table-effective increase. In this way, we contribute to ensuring that employees not only have more in their pockets now, but also later on more of their pension,” said Christian Hartard, negotiator for Rhineland-Palatinate.

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Greece

South Korea's Ambassador in Athens, Ahn Young-Jip, says his country is looking for investment opportunities in Greece’s privatization scheme. “South Korean companies were closely watching the privatization process in Greece and were on the lookout for good opportunities and incentives for making investments, while noting that public-private-sector partnership could be ‘a useful framework for inducing investments.’”

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Greece

Athens Metro workers stage a 24-hour strike “to protest what they say is underfunding of the public transport system, and the possibility that the Athens Metro would be included in privatization plans.”

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Montenegro

Chinese and Arab investors are interested in the privatization of a stake in Montenegrin port operator Luka Bar.

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Romania

A new book explores the effects of the privatization-driven transformation of Romania’s industrial landscape. privatization and Industrialisation in Romania, by Luminiţa Chivu, Constantin Ciutacu, and George Georgescu, “explores the privatization of state-owned companies from 1992 to 2015 and its impact on the industrial landscape. The authors focus on privatization’s results, which have been lower than expected, both in terms of revenues and contribution to industry restructuring, due to delays, poorly prepared offers for sale, intentional deterioration of companies’ financial situation in order to sell them, hostile takeovers and post-privatization significant diversion of the production or services activities performed before the change in ownership.” Only one-fifth of all companies that have been privatized in Romania are still active.

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Slovenia

Standard & Poor’s tells Slovenia it would hike its rating “if progress on privatization were to reduce the government's role in the economy significantly, containing contingent liabilities and further contributing to public debt reduction.” The rating company recognizes that “political disagreements could also interfere in planned privatizations in Slovenia as shown in recent discussions on the privatization of the country's largest lender, NLB.”

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United Kingdom

Dave Prentis, general secretary of the UNISON public service workers union, says now is the time to stand up for “an end to austerity and real pay rises for all public service workers.” He says, “we’ve suffered years of brutal austerity, vicious attacks on our public services and 600,000 jobs hacked away—all overseen by a government that does not care what damage it causes to people’s lives. In the first six years of Tory rule, public sector pay rose by just 4%, but the cost of living soared by 22%. And it’s getting worse. Inflation is now at 3% whilst UNISON members are still subject to a 1% pay cap. Every year under the Tories, they’ve faced a pay cut, and every pay slip a painful reminder of that fact.” Prentis told UNISON police and justice activists gathered in Llandudno for their annual conference that the Conservatives have pursued “an austerity which has led to the privatization of high-performing services in police and probation.”

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United Kingdom

More than 50 people turned out at Alcombe Children’s Centre to protest about Somerset County Councils plans to drop the number of Children’s Centres in the county from 24 to eight. Some see a scheme to privatize early care. “The Somerset Labour party has accused the Conservatives on Somerset County Council of wanting the ‘privatize’ early years provision in the long term. They say the County Council has already been inviting private companies to express an interest in delivering early years services at a ‘soft marketing’ event on September 26 where interested parties where given an anticipated date of April 1, 2019 when an outsourced service contract would begin. Mrs. See added: ‘At the event it was confirmed that the intention is to rent space in community buildings rather than have permanent ownership and maintenance of SCC buildings. So in fact the entire public consultation is nothing more than a sham.’”

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United Kingdom

The media are reporting that Conservative ministers wasted £2.8million on “external advisers” to work on a plan to privatize the NHS Professionals organisation which supplies doctors and nurses to hospitals. “Dr. Eric Watts, a consultant haematologist and spokesman for campaign group Doctors for the NHS, added: ‘This shows the complete folly of trying to impose the ideals of a marketplace where absolutely no market belongs: the NHS. It does not need privatising and it certainly does not need public money throwing away to fail to prove it might. It needs funding properly. Not giving away.’”

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United Kingdom

More than £37bn has been paid to shareholders of privatized rail, telecoms, energy and water companies which could have been invested in public services, according to the shadow chancellor John McDonnell. “The new research, compiled with the House of Commons library, highlighted more than £10bn paid to shareholders by the National Grid PLC since 2010, as well as £5.2bn paid by Centrica, the owner of British Gas, and £1bn by Yorkshire Water.”

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United Kingdom

Trade unionists are denouncing the massive £190,000-plus pay packet given to the prospective new Burton and Derby NHS chief. William Walker, secretary of East Staffordshire Trades Union Council, claimed money allocated for executive pay would be better spent on frontline NHS services. “Such extortionate pay packets only further highlight just how far out of touch these senior figures are from public opinion and, more importantly, from the plight of NHS staff and patients who will ultimately lose out because of their desire to drive through a privatization agenda.”

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United Kingdom

Barely a year after turning ScotRail over to private operator Abellio, a “climate of fear” has been created as Abellio is trying to get workers to resign in order to cover its financial losses. “Manuel Cortes, general secretary of the transport staff union TSSA, said it was time for Transport Minister Humza Yousaf to ‘stop Abellio in its tracks and take back the keys to ScotRail.’ (…) ‘It’s also no way to run Scotland’s railways. Volunteers leaving under voluntary severance won’t be replaced, meaning the customer will get a poorer service.’ He believes the move supports his belief that Scotland’s railways should be put under full public ownership. He said: “privatization isn’t working. It’s time for Scotland to run our railways ourselves.’”

 

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