ABSTRACT

Pressure on freshwater resources is growing. Global consumption and demand for water is escalating while problems of water scarcity are increasing. Water is increasingly being framed by the private sector as an exceedingly valuable commodity. Indeed, as Hetzer observes, ‘water is set to become a resource more important than oil is now.’1 Globalisation plays a role in these trends. A central manifestation of increasingly globalised processes is the continued growth of global foreign investment fl ows.2 There has recently been signifi cant transnational exploration of investment opportunities emerging in the developing world to privatise water facilities, develop run-down water infrastructure and provide water services.3 However, due to the very nature of the resource, the privatisation of water utilities innately involves considerations beyond solely commercial interests.4 As such, the way in which foreign investors engage with non-investment issues in the operation of water facilities and the use of water resources can have profound social, economic, environmental and political implications for host States and the local communities most affected by privatisation policies.