Contemporary Business Issue

Analysis of Case Study on Privatisation of Water

Africa is a water starved continent . Water resources in Africa are much lesser than in other areas of the world and this is obviously an issue of great discomfort to the inhabitants of the continent

Africa 's share of global freshwater resources is about 9 . These freshwater resources are distributed unevenly across Africa , with western Africa and central Africa having significantly greater precipitation than northern Africa , the Horn of Africa and southern Africa (A look at water resources in Africa , 2003

The deficient

water supply is further exacerbated by the widespread poverty , political strife and unrest that is endemic to the countries of the region . Only 64 of the continent 's population have access to improved water supply with the situation being much worse in rural areas . The continent is home to 27 of the world 's population that is without access to improved water supply (A look at water resources in Africa , 2003 ) Even in countries like South Africa , which are relatively more developed and politically stable water shortage is an enormous problem

This shortage of water has obviously led to a number of private companies from the west setting up base in Africa to offer water to the countries of the continent . The issue has become a matter of contention and debate with a number of lobbies debating the benefits of privatisation in increasing the distribution of supply vis a vis its effect on the poor , many of whom have lost access to the meagre water resources they could access subsequent to its privatisation

There are ten major corporate players now delivering freshwater services for profit . The two biggest are both from France--Vivendi Universal and Suez--considered to be the General Motors and Ford of the global water industry (Barlow and Clarke , 2002

Very obviously , most of these companies are very profitable and see the water crisis in Africa as an enormous commercial opportunity

The most notorious privatisation involves the British company Biwater which in 1999 was granted a 30-year contract for water provision in Nelspruit , capital of Mpumalanga Province , east of Johannesburg . The company has been dogged by controversy ever since . It has been accused of huge tariff increases , up to 100 per cent , and dwindling services with water available only a few hours a day in some areas (Rostron 2002

The World Bank appears to be actively supporting the involvement of private companies in extending availability of water to more people in the third world

It is the aim of this assignment to analyse the assigned case study , which is in the form of an extended conversation between supporters of privatization and human rights activists who feel that the poor of Africa have an inalienable right to access water and should not be made to pay exorbitant amounts of money for a very basic human necessity . The analysis of the case aims to sift through the discussions of the participants and localize the focal issues . These are as follows...