water privatization water privatization water privatization is short for private sector participations in the provision of water services and sanitation. water privatization has a variable history in which its popularity and favorability has fluctuated in the market and politics. one of the common forms of privatization is public–private partnerships (ppps). ppps allow for a mix between public and private ownership and/or management of water and sanitation sources and infrastructure. privatization, as proponents argue, may not only increase efficiency and service quality but also increase fiscal benefits. there are different forms of regulation in place for current privatization systems. private sector participation in water supply and sanitation is controversial. proponents of private sector participation argue that it has led to improvements in the efficiency and service quality of utilities. it is argued that it has increased investment and has contributed to expanded access. they cite manila, guayaquil in ecuador, bucharest, several cities in colombia and morocco, as well as côte d'ivoire and senegal as success stories. critics, however, contend that private sector participation led to tariff increases, and privatized water systems are incompatible with ensuring the international human right to water, with the belief that public water will no longer be public. aborted privatizations in cochabamba, bolivia, and dar es-salaam, tanzania, as well as privately managed water systems in jakarta and berlin, are highlighted as failures. in 2019, austria forbad the privatization of water provision via its constitution. water privatization in buenos aires, argentina and in england are cited by both supporters and opponents, each emphasizing different aspects of these cases. figures outlining the accessibility of water from the private sector also display the controversy of private water sources: one source claims that 909 million people were served by "private players" in 2011 globally, up from 681 million people in 2007. this figure includes people served by publicly owned companies that have merely outsourced the financing, construction, and operation of part of their assets, such as water or wastewater treatment plants, to the private sector. the world bank estimated the urban population directly served by private water operators in developing countries to be much lower at 170 million in 2007. among them, only about 15 million people, all living in chile, are served by privately owned utilities. privately managed but publicly owned companies serve the remainder under concession, lease, and management contracts. history the hampton water works serving london were part of the assets sold in 1989 as part of the privatization of water supply in england. privately owned water utilities were common in europe, the united states, and latin america in the mid and late 19th century. their importance gradually faded away until the early 20th century as they proved unable to expand access and publicly owned utilities became stronger. a second global dawn of private water utilities came in the early 1990s in the aftermath of the thatcher privatizations in england and wales, the fall of communism and the ensuing global emphasis on free market policies. the world bank and the international monetary fund played an important role in this process through the conditionality of their lending. in england and wales, the emergence of the first private water companies dates back to the 17th century. in 1820, six private water companies operated in london. however, the market share of private water companies in london declined from 40% in 1860 to 10% in 1900. in the 1980s, their share all over england and wales was about 25%. the tide turned completely in 1989 when the conservative government of margaret thatcher privatized all public water and sewer companies in england and wales. in scotland local governments dominated by the labour party kept water systems in public hands. the water supply of paris was operated by two private companies from 1985 to 2010, each serving one half of the city. meanwhile, the water sector in france has always been characterized by a coexistence of public and private management, with their respective shares fluctuating over time. the two largest private companies are veolia environnement, formerly the compagnie générale des eaux and then vivendi environnement, and suez environnement, formerly lyonnaise des eaux and then ondeo. the compagnie générale des eaux was founded in 1853 and lyonnaise des eaux in 1880. in the late 19th century, municipal governments, dissatisfied with high tariffs and the lack of expansion of networks to poor neighborhoods, did not renew private concessions and created instead municipally owned utilities. the share of private water operators declined to 17% in 1936. the share of the private sector gradually increased to 32% in 1954, 50% in 1975, and 80% in 2000 using a new model. instead of the concession contracts, which gave the responsibility to finance investments to the private company, the new lease contracts (affermages) made the private operator only responsible for operation and maintenance, while major investments became a responsibility of the municipalities. the french water companies also escaped the nationalizations after the war and later under president françois mitterrand, because the central government did not want to interfere with the autonomy of municipalities and was unwilling to finance heavy investments. the water supply of paris was privatized in 1985 when a conservative mayor awarded two lease contracts, each covering one half of the city. in 2010, a socialist mayor remunicipalized the water system of the french capital. the water supply of barcelona has been managed by a private company, aguas de barcelona, since 1867. in spain, private water companies maintained their position, budging the global trend during the late 19th and early 20th century. the largest private water company in spain is aguas de barcelona. initially created by french and belgian investors, it was sold to spanish investors in 1920, only to gradually come back under french control in the early 21st century. in germany, a british private water company had set up the first piped water system and treatment plant in berlin in 1852, but the city, dissatisfied with the lack of investment in particular in sewerage, cancelled the contract in 1873. in 1887 gelsenwasser was created, which remains an important regional water supplier in the ruhr district. the german water sector has always been dominated by municipally owned utilities. despite this, the water system of berlin was partially privatized in 1999 for fiscal reasons. in the united states, 60% of piped water systems were privately owned in 1850. however, this share declined to 30% in 1924. as of 2010, 2000 water and wastewater facilities in the u.s. were operated under public-private partnerships, a joint effort between the private group and the municipality it was operating in. in chile, the pinochet dictatorship established 1980 constitution including the water laws that is a foundation of chile's water systems. additionally, the government enacted the 1981 water code, a legal regime that decide to eliminate the government involvement in controlling water system and allow citizens to possess rights to exploit water resources. establishing this water code, the chile's government achieved the water privatization, and this regime is still in force. today, the government has reduced its power in water resources administration; therefore, 90% of the chile's drinking water supply is controlled by the transnational corporations. however, this water system causes the imbalance of chile's distribution of water rights. for example, since water code permits companies' to exploit water resources, 71% of chile's water resources are utilized in irrigation which is equivalent to the annual consumption of 243 millions homes. the inequal distribution of water rights induces the scarcity of chilean citizens' water resources, particularly in the drought. demonstration in johannesburg, against the privatization of water, december 2008 european and local private water companies expanded in latin america, africa, and asia in the second half of the 19th century, all while their importance declined in europe. in uruguay, water supply was privately managed from 1867 to 1950; in buenos aires, argentina, for a brief period from 1887 to 1891 and again from 1993 to 2006; in cairo and alexandria, egypt, from 1867 to 1956; in beirut, lebanon, from the 19th century until 1951; in shanghai, china, from 1875 to 1949; in casablanca, morocco, from 1914 to 1962 and then again after 1997; in senegal until 1971 and then again after 1996; and in côte d'ivoire from colonial times until today without interruption. in central and eastern europe, private companies expanded during the late 1990s, especially in bulgaria, the czech republic, hungary and romania. however, some water privatizations failed, most notably in 2000 in cochabamba, bolivia, paving the way for a new pragmatism and a reduced emphasis on privatization, and in 2019, austria forbid the privatization of water provision via its constitution. forms of privatization broadly speaking, there are two forms of private sector participation in water supply and sanitation. in a full privatization, assets are permanently sold to a private investor. in a public-private partnership, ownership of assets remains public and only certain functions are delegated to a private company for a specific period. full privatization of water supply and sanitation is an exception today, being limited to england, chile and some cities in the united states. public-private partnerships (ppps) are the most common form of private sector participation in water supply and sanitation today. the three most common forms of ppps, in the order of increasing responsibilities for the private partner, are: a management contract, under which the private operator is only responsible for running the system, in exchange for a fee that is to some extent performance-related. investment is financed and carried out by the public sector. the duration is typically 4–7 years. a lease contract, under which assets are leased to the private operator who receives a share of revenues. it thus typically bears a higher commercial risk than under a management contract. investment is fully or mostly financed and carried out by the public sector. the duration is typically 10–15 years. a mixed-ownership company in which a private investor takes a minority share in a water company with full management responsibility vested in the private partner. a concession, under which the private operator is responsible for running the entire system. investment is mostly or fully financed and carried out by the private operator. the duration is typically 20–30 years. concessions are the most common form of ppps in water supply and sanitation. they are followed by leases, also called affermages, most commonly used in france and francophone west africa. management contracts are used in saudi arabia, algeria and armenia, among others. mixed-ownership companies are most common in spain, colombia, and mexico. a concession for the construction of a new plant is called a build-operate-transfer (bot) contract. under a bot contract the private operator signs an agreement with a utility that purchases treated water or wastewater treatment services. motives the government of cuba entrusted the water supply of havana to a private company in order to improve service quality, showing the diversity of motives behind water privatization. the motives for water privatization vary from one case to another, and they often determine which mode of privatization is chosen: management and lease contracts are used to increase efficiency and improve service quality while asset sales and concessions primarily aim to reduce the financial burden or to expand access. ideological motives and external influences also play a role, with market-liberal ideology favoring privatization, left-leaning ideologies opposing, and both conservatives and centrists falling in between, often based on local and business-minded considerations. usually, several of the above motives are combined. increasing efficiency and improving service quality water privatization is seen by some as a solution to improving poorly managed public water utility systems. symptoms of poor management can include low water bill collection, high water losses (known as non-revenue water), and intermittent water supply, sometimes lasting only for a few hours a day or a few days per week. in algeria, saudi arabia, colombia and cuba increasing efficiency and improving service quality were principal motives for water privatization. in these cases, the argument to privatize water is predicated on the belief that by adopting a market-based approach to the management of water, the service provider will be incentivized by profit to increase efficiency and improve service quality. some critics argue that this belief is misguided because the water utility sector is typically monopolized by one private company. they claim that this