Skip to content

NEWS: Water privatization part of the austerity plan in Greece

Tens of thousands protest in front of the Greek parliament
Tens of thousands protest in front of the Greek parliament

The CBC reports, “Greek legislators have approved more austerity measures needed to avert a debt default next month, but in doing so have triggered a second day of riots in the central square in Athens that left dozens injured and the capital covered with tear gas. …Most of the anti-government protesters who marched to the square stayed clear of the fighting, but they vented their anger at the political establishment with chants and insults. A general strike continued for a second day, grounding planes, docking ferries and stranding tourists during the busy summer season.”

The Globe and Mail adds, “Prime Minister George Papandreou’s socialist government won a crucial parliamentary vote Wednesday to support a €28-billion ($39.2-billion) austerity program. Mr. Papandreou’s 155-138 vote victory opens the door to a fresh bailout from the European Union and the International Monetary Fund, which had made any new funds conditional on a ‘yes’ vote, to be followed Thursday by approval of the legislation that would implement the severe cutbacks. …To get there, Athens plans, among other things, to reduce the public sector work force by 150,000 – equivalent to 20 per cent of the total – over the next four years; cut military expenses by the equivalent of 0.5 per cent of GDP; freeze pensions and raise retirement ages; hike taxes on virtually all income levels, including those earning only €12,000 a year; and boost the value-added tax from 13 per cent to 23 per cent on bars and restaurants. It also plans a €50-billion privatization program, with state assets from gold mining properties to ports headed to the auction block.”

With respect to water privatization, the Guardian UK reports, “Stakes in various state assets will be placed on the auction block, in an effort to raise €50bn over the next four years. …Stakes in Thessaloniki Water are scheduled for sale. In 2012, the pace picks up, with €10bn of assets earmarked. This includes stakes in Athens Water.” The Washington Post specifies, “Sell 27.3 percent in the Athens utility and 40 percent in Thessaloniki. Keep network state-owned but privatize services.”

Global Water Intelligencer adds, “Katerina Zaharopoulou, an analyst at Eurobank, has identified a number of action points which she believes Athens Water will need to address in order for it to become sufficiently attractive to generate interest from strategic investors. Among these are the implementation of a wastewater tariff increase in order to claw back the cost of building the 750,000m3/d Psytalia wastewater treatment plant, which is currently in operation, but losing money. The integration of outlying municipalities into Athens Water water supply network, meanwhile, should enable the company to take full advantage of retail water pricing structures, versus bulk water pricing at present.”

A list of what will be privatized in Greece can be read at http://www.washingtonpost.com/world/europe/greeces-austerity-program-at-a-glance/2011/06/29/AGQe5nqH_story.html.