Privatization and the involvement of the private sector have been definitely important components of many water utilities and public projects in recent years. But the concept of “social goods, services and distribution” has also become resurgent. Is there therefore an alternative formula to “bridge” the private sector and “social goods and services” in the globalized context today, beyond mere outright privatization? However, while attempting to answer this question, it must also be firmly kept in mind, the overarching importance of corporate governance, social distribution and financial viability in public undertakings.

GLOBAL TRENDS IMPACTING ON THE PRIVATIZATION DEBATE

There are several global trends, which have had a direct impact on the privatization debate. The twin trends of neo-liberalism and liberalization have made privatization à la mode. Within the context of neo-liberalism, liberalization and globalization, the key globalization elements of goods and services, capital, human resources, and ideas have increased their circulation around the world.

But, a more unstable financial system and unstable financial markets have also ensued, especially in the last decade with the emergence of the U.S. sub-prime crisis. High social costs have also emerged in developing economies, for example, after the Asian financial crisis in 1997–98. As such, a scenario of more political uncertainties, amidst slower economic growth, political upheavals, inter-state conflicts, religious tensions and ethnic violence has thus emerged, with terrorism now deemed the “dark side of globalization”. Sustainable socio-economic development and the environment have become a la mode today too.

“Unbridled capitalism” is under attack; there is thus an urgent need to re-look at the whole concept of privatization. With an upsurge in democracy and participatory politics, there is thus increased decentralization and more devolution of power downwards. The emergence of civil society and people's power has become a check on both public and corporate sectors' integrity and governance practices. The nexus of the Asian political economy is undoubtedly shifting in Asia, from a bipolar one comprising “big business-big government” to a tripolar nexus of “governmentprivate sector-civil society”.

Myanmar is a difficult country for international non-government organizations (INGOs) to operate in effectively. It has significant humanitarian needs but the domestic and international political environments hamper effective assistance. On the one hand, agencies working in Myanmar face a sometimes obstructive, and often inept, authoritarian government which is suspicious of both their motives and those of international donor governments. On the other hand, aid and development resources and mandates are heavily restricted by international donors disturbed by allegations of human rights violations and concerned that satisfactory policy preconditions for macro-economic development are not in place. This is a “complex political and bureaucratic environment” (ICG 2008), a “politically delicate situation” (CEC 2007), in which the tension in Myanmar's relations with the international community is as large a contributor to the difficulty in delivering humanitarian assistance as Myanmar's domestic policy, capability, and will. The result for INGOs is restrictions on access, funding, and mandates.

This chapter presents analysis of new primary research data collected from INGOs working inside Myanmar between 2009 and mid-2011. In particular, it looks at their contextualization of common development approaches in order to maximize programme effectiveness. The key finding is that INGOs believe that although operating in Myanmar is difficult, their effectiveness is not as heavily restricted as is commonly perceived by people outside the country, provided they deploy appropriate sensitivity to the operational context. This is particularly true for activities that address the impact of extreme poverty in communities, but also applies in areas such as advocacy and capacity-building for the emerging civil society.

There have been many studies of Myanmar politics, and of the pros and cons of sanctions, but while this body of research often mentions the humanitarian impact of the political stalemate, few studies examine INGO effectiveness or how INGOs adapt to attempt poverty alleviation in Myanmar. This research goes well beyond previous studies by Inwood (2008), Igboemeka (2005), and Duffield (2008), presenting analysis of a much larger number of more recent primary interviews within Myanmar. I have previously presented findings from this research regarding the ways INGOs create space to operate in spite of Myanmar government restrictions and the restrictions imposed by the international community on funding and mandates (Ware 2011).

What Do Journals Tell Their Readers?

When we in Myanmar say a “gja ne” (journal) we mean a weekly news magazine or a newspaper that is published weekly, usually in the format of a tabloid and containing about thirty-six to sixty pages.

These papers are important sources of information for the Myanmar people. In such a rumour-ridden country, when someone tells a news story to another person, he will invariably be asked, “Where did you hear that?”, or “Are you sure? Who told you so?”, and if he replies that he has read it in the so-and-so journal, he will to a certain degree be believed.

The journals do not contain propaganda, like the government newspapers or radio and TV stations, nor do they contain criticism of the government, like opposition media operating abroad, but they do contain interesting local news that is closely related to the daily lives of the people, such as that a number of new telephones are to be sold by the telecommunications department at a lower price than before; that petrol is to be sold by private gas stations; that unwholesome food-colouring materials have been found in pickled tea leaves; or that there have been mudslide and floods in such-and-such an area. That is why people buy journals to read and then spread the information they find there to other people. When the Democratic Voice of Burma (DVB) presented a TV programme called “What are the journals telling? (gja ne dweigabapjo: neithale:), I found it to be a most appropriate title, precisely reflecting the interest that Myanmar people have in the weekly newspapers — the JOURNALS.

In this chapter I describe the progress that has been made during the last two years by Myanmar journalists in improving their journals by extending the area of reportage into the previously forbidden territory of politics. First, however, I would like to describe very briefly the state of the news media in Myanmar in the preceding years.

A Brief History of the News Media before 2008

A recent history of the news media in Myanmar should begin with U Ne Win. After seizing power in a military coup in 1962, General Ne Win abolished not only the political parties but also the newspapers, except for a few that were nationalized and turned into government propaganda papers.

BACKGROUND

It is very clear that for the world, water is a critical resource that will become increasingly scarce in the coming decades. Of the earth's freshwater, about two-thirds is polar ice and most of the remainder is groundwater of depths about 200 to 600 metres, but most groundwater is saline below this depth. Freshwater in rivers and lakes, as estimated by UNESCO (1978), is about 93,120 cubic kilometres (km3), about 0.266 per cent of total freshwater in the world. Compared to total water supplies in the world (freshwater and non-freshwater), rivers and lakes only constitute about 0.0072 per cent of the total. That is why water is now a very critical and important resource for human development.

In Southeast Asia, the average water availability per capita is about 4,900 cubic metres (m3), but the water resources vary with space and time. For example Laos has the highest water per capita (about 35,000 m3), while Singapore has the lowest (about 155 m3), with Vietnam (an inland country) estimated at about 3,870 m3. For most rivers in the region, water flows during the flood season occupies about 70 to 80 per cent of the total water supply during the year. For Southeast Asia, the Mekong River is the largest, with a total watershed area of 795,000 square kilometres (km2). The length of the main river is 4,400 kilometres (km), and average discharge is 15,000 cubic metres per second (m3/s). The Mekong River Basin flows across six countries: China (165,000 km2), Myanmar (24,000 km2), Thailand (184,000 km2), Laos (202,000 km2), Cambodia (155,000 km2), and Vietnam (65,000 km2).

INTRODUCTION

One of the growing trends in the global water industry is the transfer of the production, distribution, and management of water services from public entities into private hands — a process commonly known as “privatization”. The privatization of water encompasses a wide variety of possible water management arrangements. Privatization could be partial, leading to so called public/private partnerships, or to the total elimination of government responsibility for water supply systems except for its regulatory role. This chapter presents, in part, case study undertaken by Puncak Niaga in mid-2005.

As a measure of importance of privatization, the Second World Water Forum in March 2000 gave special emphasis to the need to mobilize new financial resources to solve water problems and called for greater involvement by the private sector. The “Framework for Action” released at the forum called for US$105 billion per year in new investment to meet drinking water, sanitation, waste treatment, and agricultural water needs up to year 2025. The framework also called for 95 per cent of this new investment to come from private sources.

In Malaysia, the National Water Resources Study Report produced in year 2000, which covers the planning needs up to year 2050, have recommended sixty-two water projects costing US$13.66 billion. The projects include the construction of fortyseven dams, large treatment plants and the transfer of water from one state to another.

The need for new development programme and investments coupled with the need to improve current condition of assets and service definitely requires substantial capital expenditures (CAPEX), which has become a fundamental problem in all privatization endeavours. In some cases, the rate of return in investment is not even adequate to even cover the operating cost, resulting in the accumulation of huge debts.

Such enormous tasks covering the aspect of developing, financing, managing and operating the water supply services have made it inevitable for private water operators to be more involved in the industry. New and innovative financing tools available to the private operators have also made it possible for them to undertake the transfer of responsibility for developing, managing and operating water supply services.

INTRODUCTION

Among developing countries, the Philippines has been in the forefront of privatizing its urban water systems. The Metro Manila Water and Sewerage System (MWSS) was privatized in 1997 as a concession covering water and sanitation services. The concession was split into two, covering a twenty-five-year period, and awarded on the basis of an international bidding procedure that was recognised as open and transparent, and declared the biggest water privatization in the world during the time. The contract was divided with the hope that doing so would facilitate the work of the regulator in introducing benchmarking and quasi-competition.

This chapter examines the experience of water privatization in the Philippines, focusing on the case of Metro Manila where water and sewerage services were privatized in 1997. A new and all Filipino partnership of DM Consunji Holdings Incorporated and Metro Pacific Investments Corporation (DMCI-MPIC) took over the management of Maynilad Water Services in 2007. However, the outcome of this takeover is still uncertain and as such, will not be discussed in this chapter.

Most countries that have privatized water provision have experienced a series of problems and, in some cases, have been classified as failures. However, the experience of privatization in Manila, with one well-performing and one unsuccessful concessionaire, offers valuable insights into what enables successful water privatization.

To this end, this chapter examines the issue of water privatization in five parts. The first section presents the arguments for and against privatization and identifies the proponents of each alternative. The second section looks at water provision before privatization in Metro Manila. The third section considers the privatization process, while the fourth looks into the outcomes of privatization thus far. The conclusion sums up the evidence and formulates lessons that can be drawn from the Metro Manila experience.

PROS AND CONS OF WATER PRIVATIZATION

In 2002, the UN Committee on Economic, Social and Cultural Rights released a General Comment on the Right to Water, declaring that access to sufficient, safe, physically accessible, and affordable water for personal and domestic use is a basic human right.

War and Its Alternatives

Myanmar carries the tragic distinction of hosting the world's longest-running civil wars. These conflicts — some of which commenced almost immediately after the Second World War — have frustrated attempts to bring about lasting and peaceful resolutions. The civil wars colour relations between the country's ethnic minorities, who make up around one-third of the population, and the ethnic Burmans who are the majority. Inter-ethnic battles have seen countless casualties as all sides struggle to defend competing visions of pride, power, and position. But periods of relative stability, without regular violence, have also shaped the political landscape. For the past two decades, Burma's unresolved wars have been characterized, in large part, by ceasefire agreements that discouraged direct hostility and confrontation. The 1988 disintegration of the Communist Party of Burma generated a suite of militia groups, often labelled with the ethnicity of their respective leaderships, that the world came to know through the prism of their ceasefires with the Myanmar government.

Ceasefires with former Communist troops in the Shan State were followed by agreements with other ethnic militias in Kachin, Karen, and Mon areas that offered the government a modicum of nationwide “peace” to bolster plans for national “development”.

A foundational characteristic of Burma's State Peace and Development Council period (1996–2010) was the preponderance of these agreements and the economic, political, and cultural responses that followed. In 2007, Martin Smith, a long-time analyst of ethnic politics in Burma, suggested that “[b]y any international standards, the achievement of ceasefires with so many insurgent groups, in one of the most conflict-torn countries in Asia, has to date been unexpectedly smooth and stable” (Smith 2006, p. 53). He argued that the “simplicity” of the agreements, the general concessions that accompanied most deals, and the prospect of almost immediate and unprecedented economic development, meant the ceasefires “quickly found popular support”. Some ceasefire group leaders fully embraced economic opportunities under the ceasefire stalemates. They built lavish residences, sent their children to posh schools and cultivated commercial relationships well beyond their immediate mountain strongholds.

The ceasefires were designed by Myanmar government strategists to present strong disincentives for any ethnic leaders considering a return to hostilities. According to another long-time observer of ethnic politics, Ashley South, “[t]he regime's intention [was] said to be to promote disillusion with, and provoke disputes within, ethno-nationalist communities, causing armed organisations to lose support” (South 2008, p. 156).

INTRODUCTION

Urban Southeast Asia is experiencing an environmental crisis in which there have been few triumphs. The Asian Development Bank (ADB) considers Southeast Asia's water pollution to be “severe”, more severe than China and East Asia. In particular faecal coli forms, low levels of oxygen and high levels of lead are seen as very severe; suspended solids as severe; and nitrates as a moderate but rising threat. ASEAN too sees “the management of environmental problems arising from a rapidly expanding and highly diversified industry sector is one of the most important issues confronting ASEAN today”.

Despite widespread concern over water pollution by governments, donors and civil society there have been few examples of partnerships developing to turn the region's cities into more sustainable entities. Instead, there have been acknowledged failures in both state-led and private sector strategies. The limitations of past and present responses have resulted from, and also now contribute to discord over an urban vision and disaffection over who is responsible for pollution and what actions need to be taken. These conflicts, in turn, are the product of economic and social polarization in many Southeast Asian cities, which makes consensus over issues such as pollution and policy responses increasingly difficult. As a result, environmental conflict is becoming a new social and political fault line in the region's industrializing cities.

In surveying a number of policy responses to environmental problems in urban Asia, an inherent tension is immediately evident between the science and the politics of pollution. While pollution lends itself to measurable and quantified data, the causes and solutions are to a great extent more socio-political in origin and nature. As such, there are clear limitations in government and development agencies approaching urban pollution with immediate technical solutions. McGranahan has remarked that “the notion that local environmental problems can be engineered away” is a convenient fiction, suppressing the inherent tensions between social groups around the framing of environmental problems and their resolution.

The availability of freshwater resources will be one of the most pressing environmental challenges in the years ahead. International dialogues in water have gone through several stages. From 1970 to the early 1980s (first stage), human health issues were the catalyst which ignited the international discussion of water. Then it was the Mar del Plata Action Plan in 1979 which called countries to develop national plans and programmes regarding the provision of water supplies and sanitation at a community level.

From the 1980s to the early 1990s (second stage), there was a growing recognition of water as an element of sustainable development. The Dublin Principles in 1992 referred to the economic value of water, and the importance of “integrated water resource management”.

From 1992 onwards (third stage), water issues have jumped in importance to become a priority issue. Water was recognized to be in a short supply; and in the Millennium Development Goals, the goal was set to include reducing or halving the proportion of population without sustainable access to safe drinking water by 2015. The Johannesburg Plan of Implementation in 2002 also reaffirmed the water supply goals of the Millennium Development Goals and also set a sanitation goal. In 2003, the United Nationals World Water Development Report also recognized that there was a water crisis globally, identified the causes, and provided tools to assess progress towards building a better future. In 2006, the United Nations World Water Development Report 2 recognized water as a shared responsibility recognizing the diverse functions of water as a resource, and also the stewardship roles that could be played by governments, communities, and individuals.

Narrowing the focus, Southeast Asia's annual per capita freshwater resources increased at an average rate of 38 per cent from 1996 to 1999 but has started to decreased at an average rate of 17 per cent beginning from 2000 to 2004, partly as a result of increases in the region's population and also development activities.

In the past two decades, the system of centrally planned agricultural policies that were introduced under the “Burmese Way to Socialism” and that had existed since 1962 has been progressively dismantled, although slowly and incompletely. It would be fair to state that over the two decades since 1988, following the introduction of policy oriented towards the development of a market economy, government control over agricultural cropping decisions has been substantially relaxed, but this happened only gradually and only through ad hoc mechanisms. Economic transformation proceeded, but with frequent reversals of the deregulation process, in response to changes in the global and, in particular, in the domestic economic and political situation.

Although farmers are now freer to make their own cropping decisions, there are still restrictions on the cultivation of rice on paddy land, particularly in relation to the double cropping of rice as summer paddy production on irrigated paddy land. The dominant theme of government policy has been the pursuit of increased production of rice and of another nine cash crops through targeted yields. The government has set specific sector objectives — first, to generate surplus rice; second, for Myanmar to become self-sufficient in edible oil; and third, to increase the production and export of pulses and industrial raw material crops.

One important step was the ending of state procurement of all crop output, including rice but with the exception of some industrial raw material crops (namely, sugarcane, cotton, and jute), by state-owned economic enterprises (SEEs) at prices fixed by the government. This has increased the amount of rice and other major agricultural commodities available in the market, and has induced more private entrepreneurs to enter the trading business. Government subsidies on agricultural inputs, particularly agricultural chemicals, were abolished, and provision of agricultural inputs and machineries by the private sector is now allowed.

Private exports of agricultural produce, with rice and oilseed crops most recently included, has also been permitted, although with certain interventions and controls being made by the government from time to time. However, the liberalization of rice exports that was initiated in 2003 can be viewed as an ad hoc attempt to transform the marketing system (Okamoto 2009).

Relations between the European Union (EU) and Myanmar in 2011 are at their lowest ebb. The EU has maintained restrictive measures against Myanmar for over two decades, citing as justification egregious violations of human rights in the country and the lack of progress towards democratization. However, recent developments in Myanmar and the new environment in the EU present a window of opportunity for both Myanmar and the EU to drop the hubris of the past two decades and attempt a different approach.

In April 2011, at the annual review of the EU's sanctions policy on Myanmar, Germany, Italy, Spain, and Austria reportedly pushed for a new and pragmatic approach, while the United Kingdom, the Czech Republic, and others urged that sanctions be maintained. In the end, the sanctions were renewed, but a small concession was made by lifting the travel ban on some civilian leaders of Myanmar for one year, and a decision was taken to keep diplomatic channels open. An existing ban on EU officials visiting Myanmar was also lifted. But much more needs to be done. A letter dated 11 March 2011 that was sent by the Myanmar-based Group of Democratic Party Friends (GDPF) to the EU, urging it to lift the sanctions, reflects the growing opposition within Myanmar to the sanctions regime. The GDPF has also called on the EU to restore Myanmar's Generalized System of Preferences (GSP) status.

The Evolving Situation in Myanmar : EU Responses

Myanmar in 2011 is at a defining moment in its history. Elections have been held and the transition from military rule to a form of civilian government and constitutional rule has been initiated. On 30 March 2011, a new civilian government was sworn in. On the same day, the State Peace and Development Council (SPDC), the military council that had ruled Myanmar for over two decades, was disbanded. Senior General Than Shwe, the head of the armed forces, and his deputy, Vice Senior General Maung Aye, have relinquished their posts. The National League for Democracy (NLD) leader, Aung San Suu Kyi, has also been released from house arrest.