A closer look at Blue Gold

 

Project Blue Gold’s 5-Year Plan is a step towards awakening national conscience and achieving economic preeminence and equilibrium for Lebanon. If Blue Gold succeeds, Lebanon will emerge as a model for economic growth, social conviviality and inspiration for all Arab youth seeking viable solutions for their future.”

An advertisement campaign was recently launched to get the citizens of Lebanon to vote for a water reform plan proposed by the private sector. It is called the Blue Gold Project. TV commercials such as this:  and online ads urged the Lebanese to vote for this project. Blue Gold aims to obtain a million votes to support its 5-year plan that includes the establishment of a National Water Council for Lebanon “free from any political influence”. In the local media, the project was either praised as a way to improve the water situation in the country, or accused of trying to privatize the water sector and commoditize water for personal profit.

The government of Lebanon has set an objective to meet the demand of water by 2020 for 7.4 billion USD. Blue Gold’s business plan claims that by 2020, the project will exceed demand by 500 million m3 for a total cost of 5 billion USD (30% less than the government budget). The project proposes 40 initiatives by 2030 that will increase water supply, optimize water demand, improve water quality, and improve water management. The 5-year plan will only include 15 of these 40 initiatives (See the table below). More details on each initiative can be found in the Blue Gold book:

Table 1: Initiatives of Blue Gold’s 5-Year Plan

Table Blog

Blue Gold calls for the formation of new institutions that are politically independent that will manage the water sector more efficiently. The Project proposes that the National Water Council of Lebanon would be the main stakeholder responsible for strategic planning, a regulatory authority would be established to supervise the water management process and a non-governmental watch dog organization would be needed to monitor all the stakeholders involved.An integral part of this 5-year plan is the institutional reform of the water sector. The water sector in Lebanon is currently governed and administered by the following entities: Ministry of Energy and Water, 4 regional Water Establishments (Beirut & Mount Lebanon, North, Bekaa and South), Ministry of Environment, Ministry of Agriculture, municipalities and the Council of Development and Reconstruction.

In addition, the plan proposes a set of local reforms. The first is the initiation of private participation schemes. These schemes will finance water projects and “increase efficiency and service quality.” The plan calls for the private sector to be involved in the water sector in the following ways:

  • Private operators will be eligible to bid for management contracts that focus on billing services, and the operations & maintenance of distribution networks.
  • Investment construction, operation and maintenance of water systems will be transferred to the private sector
  • Private sector must participate as a production, distribution, meeting, and billing operator

Who is behind the Blue Gold Project?

According the Blue Gold Plan, the Civic Influence Hub (CIH) is “an influence group of the Lebanese civil society, aiming at building the dynamic of change and development of economic and social policies through civic influence, thus empowering citizens’ participation and expanding their options under the Rule Law and institutions. Individuals representing the civil society, of all religions and without any political agenda, decide to join their forces, their weight in the society and their financial contribution in order to hopefully build, on a long term, a Lebanese national conscience.” In short they are a lobbying group: a group of leading business individuals who constitute the main thrust behind the project.

Existing Initiatives

There is no doubt that the water sector in Lebanon has its fair share of problems. In fact, Blue Gold’s 5-year plan does a good job in identifying these problems and many of the proposed initiatives address them. Over the past years, the governments of Lebanon, in cooperation with various governments and international aid agencies, have worked on similar initiatives. For example the USAID and Italian government have built several wastewater treatment plants in the country. The Bekaa Water Establishment, with the help of various donors (such as UNICEF, EU, etc.), have been rehabilitating the water networks in the governorate. The International Fund for Agricultural Development (IFAD) are financing an ongoing project called the Hilly Area Sustainable Agricultural Development Project that deals with sustainable agricultural practices which includes water harvesting and other water management practices. The initiatives proposed in the plan will thus need to incorporate these projects to avoid any duplication and waste of resources.

Costing of the Plan

The plan provides a brief summary of each initiative that includes the description, challenges, targets, benefits, and cost. However, detailed breakdown of the cost and the amount of water produced are not included. Only one figure is provided without a clear explanation on how it was obtained, especially considering the plan claims to provide a cheaper alternative to the government’s proposals.

Political Influence

A set of the initiatives proposed in the plan deal with management of the water sector. The plan calls for the establishment a politically independent National Water Council of Lebanon that will be the main entity responsible for the sector. In theory, this is ideal. However, how does Blue Gold propose that this politically independent entity be achieved, when almost every government institution in the country is influenced by political factors? How will Blue Gold guarantee that the National Water Council will be immune from political influence? And if it is, how immune will it be from influence of the Civic Influence Hub?

Privatization

Finally we get to the most controversial part of the plan, and that is the role of the private sector. The plan begins by stating that: “The problem is that we do not realize the wealth we have. We see water as a cheap commodity ignoring the fact that the value of a bottle of water is the same as a bottle of water is the same as a bottle of crude oil.” Throughout the plan there are terms that equate water to wealth; the name of the project “Blue Gold” directly links water (blue) with an expensive commodity (gold). Nowhere in the plan is there mention of water as a “public good”. An article 11 & 12 of the International Covenant on Economic, Social, and Cultural Rights, ratified by Lebanon in 1972, has declared access to water as a human right and establishes water as a social and cultural good and not an economic commodity.

The plan identifies successful private sector participation experiences in the water sector in the UK, France, KSA, Qatar, and Jordan. However, it fails to mention that in Paris, under the private sector, there was poor accountability and a major increase in the price of water. Eventually, in 2010, the water system of Paris returned to public management. The plan also did not mention the infamous water privatization experience in Bolivia, when water tariffs increased by 200-300% which caused massive protests and civil unrest in 2000. South Africa’s water privatization scheme also resulted in a major price increase; poor people who could not afford to pay were deprived of access to water[4]. The plan overlooks any problems in the privatization of water. In a country like Lebanon, where the poverty rate is about 28% (over 50% in some areas), privatization of water may lead to massive socioeconomic problems and injustice.

Bottled Water

One of the ways the Blue Plan foresees profitability from the water sector is by turning the bottling industry into a “regional economic powerhouse.” The plan is therefore advocating the sale of scarce drinking water abroad even before Lebanese have proper access to it.  They fail to mention that a bottled water industry would consume many of the country’s resources including energy and water; it takes 3 liters of water to produce 1 liter of bottled water. While there have been many campaigns to ban plastic bottle of waters all over the world (San Francisco last month became the first major American city to ban plastic bottles of water), the Blue Gold project plans produce and export plastic bottles to the region.

In Conclusion

While the 5-year plan of the Blue Gold project proposes many beneficial projects, it seems to be lacking the basic tenet of right to water by the population of Lebanon as a priority. Management of water needs to be efficient and financially sustainable; but water itself should first and foremost be treated as a public good, not just another commodity.

 

 

 

 

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