Italy breaks ranks with EU on water aid scheme

Launched in 1999, PPIAF sponsors improvements across a range of infrastructure sectors, most notably water and sanitation in developing countries through involvement of the private sector.

But NGOs – led by the World Development Movement - have repeatedly called on donor governments and agencies to abandon support for the PPIAF, arguing that it is a "highly controversial element of the World Bank's water privatisation agenda."

Instead, they say, PPIAF is designed to help Western corporations break into emerging water management markets rather than reducing the number of 1.1 billion people worldwide who do not have access to clean drinking water.

"Water is not a commodity and we have to work to remove it from the logic of privatisation," said Italian vice minister for development cooperation - Patrizia Sentinelli - in a statement on Tuesday (22 May).

"I think it is crucial to have an international debate on the negative consequences of the push for privatisation in sectors so sensitive that touch upon our common goods," she said, explaining that it was for this reason the Italian government had decided to withdraw its support for the PPIAF.

"I hope that this political signal will, together with that of other governments, reopen international debate on these issues," Ms Sentinelli added.

Still strong European support

Last February, Norway pulled out the scheme following a damning report, which said the agency funded "activities designed to persuade skeptical populations about the 'benefits' of privatisation."

But the European Commission and EU members France, Germany, the Netherlands, Sweden, and the UK still donate to PPIAF with London contributing 54 percent of the agency's total funds.

The commission has "taken note" of the Italian decision. "It is a political choice and…we respect it," a commission spokesman told EUobserver, adding that Brussels still stands behind the PPIAF.

"The commission's support to PPIAF is part of its support towards building the private sector in Africa, which is crucial," said Amadeu Altafaj, the spokesman.

"Business development and particularly a dynamic private sector are essential for economic growth and provide the main source of employment in developing countries," he explained, adding that "[it's] not the first time that some NGO claims that the commission funding of PPIAF is to promote privatisation of water service provision."

Other donors to the World Bank agency include the Asian Development Bank, Canada, Japan, Switzerland, the US and World Bank itself.