In late 1999, following several years of World Bank and IMF pressure, the Bolivian government passed a law privatizing Cochabamba’s water system. – Aguas Del Tunari, - a local subsidiary of the San Francisco- based Bechtel Corporation, was the only bidder, and the worst predictions of water privatization were quickly realized: Before any infrastructure investments were made to ensure improved or expanded services, rates increased overall, even tripling for some of the poorest customers. In a country where the minimum wage is less than $60 per month, many users received water bills of and above $20 per month, and water was shut off completely for others. The law privatized all water supplies in the city. As a consequence, citizens who had built family wells or water irrigation systems decades earlier suddenly had to pay Aguas del Tunari for the right to use this water. While the company sought 16 percent annual return on its investment, price hikes simply put water out of the reach of many customers. It was not difficult to predict the failure of Cochabamba’s water privatization experiment.

The World Bank and the International Monetary Fund at the Helm Because of its faithful adherence to World Bank and IMF policies, Bolivia has become the institutions’ poster child for neoliberal economic reform. The tragic irony is that Bolivia remains one of the poorest nations in the world, with approximately 70 percent of its population living in poverty.

In its latest country report on Bolivia, the World Bank calls this situation a “fundamental paradox.” Unable to explain why poverty persists in a country listed among its “best performing portfolios” and that follows directions (including privatizing its water), the Bank called for more privatization, liberalization and harmonization.

When the marches were met with violence by the police, and silence by the government, the people organized a public referendum to determine how to proceed. Over 50,000 people voted in the referendum, the vast majority demanding that the government end the contract with Aguas del Tunari.

When the referendum was ignored by the government, the people of Cochabamba —young and old, students and workers, city and country dwellers—engaged in a unified nonviolent uprising to take back their water from mid-January through early February 1999. These "water warriors" shut down Cochabamba through coordinated nonviolent street protests, strikes and blockades. The government then declared a State of Siege, arresting protest leaders in their beds, shutting down radio stations and sending more than 1,000 soldiers into the streets with live ammunition, killing a 17-year-old boy and wounding dozens of others. After weeks of confrontation the citizens refused to back down and on April 10, 2000, the government conceded, signing an accord to end its contract with Aguas del Tunari and Bechtel. The Bechtel Corporation has responded by threatening to sue the government of Bolivia for lost investments and potential future lost profits via a provision in a bilateral investment treaty.

With the help of La Coordinadora, the water workers held regular citizens’ meetings to determine need. They reduced prices, built new water tanks and laid pipes—bringing service to neighborhoods that had never received water before. Funding proposals were devised to attract investment to make the company solvent. For the first time, water is being provided universally, fairly and reliably.

The IFG contingency witnessed firsthand the intense popular support and expectations for both SEMAPA and La Coordinadora. They have shown the citizens of Cochabamba and the world a true third way—not government corruption or privatization, but a public / government partnership where a public service is run with the full support and inclusion of its workers and its community.

The members of the IFG Committee on the Globalization of Water held a press conference to demonstrate our support for La Coordinadora and SEMAPA, met with citizens from across the city to hear first hand their experiences, and strategized with members of La Coordinadora on how to continue our partnership. At the water conference, the IFG invited members of the audience including workers, students, lawyers, farmers, and others, to join us in drafting a “Declaration of Cochabamba,” which states, among other things, that water is a basic human right to be protected and provided by the people. Water is not to be traded and sold by financial institutions or multinational corporations. This declaration is a starting point for building an international people’s movement in support of the Cochabamba alternative.

In the words of a 17-year-old Cochabamban “water warrior,” the battle has been won, but the war is not over. “There will always be another Bechtel and another World Bank policy if we do not fight for greater change.” Now is when we begin.