Global Water Index: Investments for Privatized Water

economy, international, investments, water privitization, water trade

You may have heard the phrase S&P 500 floating around, background noise as you listen to the news. But if you are a person with even an inkling of interest in the stock market, you will know the S&P 500 is an index exhibiting stocks of the top 500 publicly owned companies primarily from the US.

The S&P 500 shows the market value of the 500 companies in the index and is a good indicator of how the stock market is doing as a whole. The index will rise if the market value of a company goes up (with an increase in individuals interested in purchasing shares), and the index will decrease if the market value of a company goes down.

Well, what does this have to do with water, you ask.

The S&P 500 actually has little to do with water itself, but Standard and Poor’s (the company that created the S&P 500) recently released an index of the top 50 companies in the global water sector called the S&P Global Water Index. The Global Water Index is similar to the S&P 500 except investors use it to track viability of investments in the international water sector. The Global Water Index is comprised of 25 companies in water utilities or infrastructure and 25 companies in water equipment or materials.


Photo courtesy Pixieslayer on flickr.

Events such as the subprime mortgage crisis in the US and rising oil prices have really challenged the future of investments. Water, necessary to life and in demand everywhere on the planet, is thought the next big thing among some economists.

“One man’s challenge is another man’s opportunity. With water shortages an enormous challenge in both the developed and developing world, companies that transmit, purify, or supply equipment should benefit.”

– Forbes, ‘Ways to Play Water

Should individuals with money benefit on global shortages of drinkable water?

Individuals are already investing in the global water sector, and this will influence sustainable and available water supplies into the future. Such investments could drive-up the cost of implementing water infrastructure or treatment facilities for developing countries with dwindling budgets. In addition, among the ten most profitable companies in the Global Water Index are SUEZ Inc. and Veolia Environnement SA. These privatized water suppliers, as well as others in the index, have poor records of providing affordable and dependable water supplies.

For more information on water privatization, see this post on Waterblogged.info or listen to this CBC radio series (a little past due but still great), Water for Profit.

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Bottlemania: How Water Went on Sale and Why We Bought It

drinking water, outreach, sustainability, water privitization, water trade

A new book, Bottlemania by Elizabeth Royt, will focus on the complications of bottled water in today’s society. It will be available on May 13, 2008.

The book will address questions such as:

“Who owns our water? What happens when a bottled-water company stakes a claim on your town’s source? Should we have to pay for water? Is the stuff coming from the tap completely safe? And if so, how many chemicals are dumped in to make it potable? What’s the environmental footprint of making, transporting, and disposing of all those plastic bottles?”

For more information on bottled water, see the new Water Page on AlterNet. Tara Lohan, managing editor of AlterNet, has written several articles on the negative implications of bottled water in our world including This Year Give Up Bottle Water for Lent and What Would You Say to Coke’s Executives? (a review of ” a pioneering campaign that gives new meaning to message in a bottle“).

See the Water Books Page at the top of this web-log for more books on water.

Singapore’s International Water Week 2008

asia, economy, international, research, technology, water privitization, water trade

Singapore is hosting International Water Week from June 23rd to June 27th of 2008. This first-annual event is to be held as a forum for “government officials, industry leaders and water specialists” to discuss policy, business, and water technology. Festivities of the week encompass a Water Trade Show, a Water Summit, and presentation of the Lee Kuan Yew Water Prize to an innovator in the field of water technology.

In 2006, Singapore began wide-spread governmental investments in water technologies to accelerate economic growth in the water sector. No doubt hosting two-hundred exhibitors of water technologies will be great way for the country to stay abreast of additional investment opportunities.

However, several main sponsors of International Water Week include multinational corporations with questionable environmental and water management track records including:

Enterprising steps in the field of water technology are fundamental to ensure available water supplies now and into the future.

Does sponsorship of International Water Week by the above organizations make this event any less important? Not necessarily, but maybe it does mean that we should pay closer attention to these companies and their water management standards.

New Water Financier Scopes Markets in Gulf, India, and China

economy, water privitization

A large Saudi Company, among others, is staking it’s claim in the burgeoning enterprise of water investments. According to Arabian Business On-line, the joint venture is formed of two companies from Bahrain and Saudi Arabia. Starting with a minimal sum of $50 million dollars, the company has plans to finance water projects in arid areas such as the Gulf region, India, and China. The choice of these areas, where water is in great demand, could provide a surplus of business ventures for the new company, Moya. Nahed Taher, CEO of Moya, states:

“The demand for water in emerging markets is growing rapidly and the Gulf, India, and China are among the major markets that I want to be in,” said Taher.

“The demand elasticity for water is minimal hence no matter what the cost of water becomes, the demand level is always stable which makes water projects good ones to finance,” added Taher.

As parasitic as the above-quote does sound, capitalising on water has become commonplace, and, seemingly, is proving to make for a profitable endeavor.

It is not clear whether Moya intends on privatizing operating entities for water purveyors (British Model) or financing construction of such facilities (French Model).

However, privatization as a model for managing water supplies has been consistently problematic in the past. Examples of such problems include degraded water quality, unstable supply systems, excessive prices for water, and extensive public debt.

In summary, it is difficult to understand the commercialism of basic needs, and why a public resource such as water is not a guaranteed basic human right.

Short Film on Water Privitization

drinking water, economy, groundwater, water availability, water privitization, water trade, water treatment

This film, produced by the World Development Movement (WDM), gives a brief overview of the water privatization throughout the world. It is called “Dirty Aid – Dirty Water” because as entities like the World Bank and the International Monetary Fund provided loans to developing countries, often times they did so with the stipulation that the country receiving the funding must agree to participate in a water-privatization program. Privatization of water supplies in these countries has seen many ill effects including significant increases in water prices making water less available those in need.