Is Cash-Strapped Portugal Using Austerity as an Excuse to Privatise Water?

Water privatisation is once again a topic of debate in Portugal. The subject was recently discussed in the Portuguese parliament, where the leader of the The Greens party, Heloisa Apolonia, accused the government of “withdrawing its promises on the water sector”.

Minister of Environment Jorge Moreira da Silva has assured that authorities will not privatise Águas de Portugal (ADP), the national company that manages water supply in the country. However, the minister is supporting the restructuring of the treatment system and water supply — which includes raising tariffs in the coastal municipalities to reduce prices in the interior of the country — to ensure its “economic and financial sustainability.”

Local councilors fear that this restructuring is a step to privatise this essential commodity in the same way the country's urban waste management company fell into private hands in 2014. The country's high levels of debt put it at the mercy of foreign capital, making it more vulnerable to privatisation.

But the minister has rejected this theory, saying that the reform implemented avoids this scenario. Moreira da Silva says the plan will lead to greater equity in the cost of water across the country.