Veolia’s hostile takeover of Suez in 2022 is in part a reaction to the solid work over 20 years of the Water Justice Movement, a global network of trade unions, civil society organisations, academics, elected officials and public utility managers, amongst others. Our firm and coordinated resistance to the French model of water and sanitation privatisation has forced the two French giants to change their business models. The 25-year ‘public-private partnership’ contracts are no longer very popular, at least not in countries with strong trade unions and dynamic civil society. Their multiple problems have been well documented and serve as the basis for activist education and mobilisation.
The report by l’Observatoire des multinationales shows the French water giant Veolia and its gamble for continued corporate expansion. It peels back the inner workings of the French water corporations, financiers, governments, lawyers, PR firms, etc. This network has been in existence for generations, with revolving doors, influence peddling, corporate lobbying, even bribes and other forms of corruption and unethical practices. This system is replicated and exported as the companies move overseas to capture public contracts for essential services. To do this they combine with the World Bank, regional and national development banks and UN agencies. All to perpetuate a business model that has been very lucrative and stable for a long time.
That fact that Veolia and Suez spent hundreds of millions of Euros – perhaps even €1b in all – in this hostile takeover is in itself astounding. Add to that the approximately €11bn that Veolia spent (and borrowed) to acquire the assets from Suez. These are corporate funds made from the private control of water and sanitation and other public, largely municipal services. As the report shows, Veolia is making a business projection of many more hundreds of millions to be earned from the new public funds for dealing with the climate crisis, justifying this expensive takeover.
This points to our need to assess how climate funding contributes to privatisation. A PSI report jointly with our Korean affiliate KPTU on the global Green Climate Fund (based in Korea, but operating under the auspices of the UN) shows a structural bias towards privatisation and market-based solutions. Trade unions and allies in the Water Justice Movement need to connect with climate activists to broaden our resistance to climate-related privatisations of water and other services.
We also need to track these two French companies as well as the new privateers in water and sanitation, which are private equity companies eager for the profits they can extract from the water sector.
This document is released during the UN Water Conference 22-24 March 2023. Many of the key global policy makers in the water sector appear convinced that private financial corporations should be induced to invest small portions of their trillions in building and operating water and sanitation services in developing countries. They plan to use whatever public funds are available to subsidise global capital’s profits, which need to be especially high in developing countries, as these are risky investments.
This is one further document to use in our collective campaigns for water justice, for people and planet over profit.