Water privatisation in Jakarta

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Jakarta districts

Water privatisation in Jakarta refers to the process and outcomes of transferring the management and operation of water services from public to private entities in Jakarta, the capital city of Indonesia. This initiative began in the late 1990s and has been a subject of significant debate and controversy.

Background

In the mid-1990s, Jakarta faced severe challenges in its water supply system, including inadequate infrastructure, high levels of water loss, and poor service quality. To address these issues, the Government of Indonesia decided to privatize the water services in Jakarta. The privatization was part of a broader trend of privatization and public-private partnerships in the country.

The Privatization Process

In 1997, the water services in Jakarta were divided into two zones: the western zone and the eastern zone. The western zone was awarded to PAM Lyonnaise Jaya (Palyja), a subsidiary of the French company Suez Environnement, while the eastern zone was awarded to Aetra Air Jakarta, a subsidiary of the British company Thames Water.

The contracts were signed in 1998, and the private operators took over the management of water services. The agreements were designed to last for 25 years, with the aim of improving water quality, expanding access, and reducing water losses.

Controversies and Criticisms

The privatization of water services in Jakarta has been highly controversial. Critics argue that the private operators have failed to meet their performance targets and that water tariffs have increased significantly without corresponding improvements in service quality. There have also been allegations of corruption and lack of transparency in the awarding of the contracts.

In 2013, a coalition of civil society organizations and residents filed a lawsuit against the privatization, arguing that it violated the human right to water. In 2015, the Central Jakarta District Court ruled in favor of the plaintiffs, ordering the termination of the privatization contracts. However, the decision was later overturned by the Jakarta High Court.

Current Status

As of 2023, the future of water privatization in Jakarta remains uncertain. The government has been exploring options for restructuring the water services, including the possibility of returning to public management or renegotiating the contracts with the private operators.

Impact on Residents

The impact of water privatization on Jakarta's residents has been mixed. While some areas have seen improvements in water quality and access, many residents continue to face challenges such as intermittent supply, high tariffs, and poor customer service. The issue of water privatization remains a contentious topic in Jakarta's public discourse.

See Also

• Privatization
• Public-private partnership
• Water supply and sanitation in Indonesia
• Human right to water and sanitation