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The privatization of water and sanitation in Buenos Aires has been hailed by its neo-liberal proponents as an unprecedented success. This paper takes a deeper and more critical look than many of these accounts. It looks at political and economic changes within Argentina in order to explain the troubling findings regarding the performance of Aguas Argentinas, the private company that won the concession for most of Buenos Aires. The paper begins with a brief overview of the political and economic context in Argentina before describing the process involved in the water privatization in Buenos Aires. It then discusses the outcomes, including changes in coverage and charges to end users as well as impacts on labour and the environment. The paper describes how the promised reduction in water tariffs did not materialize (in fact the opposite occurred) and how agreed-upon targets for expanding sewerage connections and sewage treatment were not met. It also describes how the national government intervened to support the water company in conflicts with the regulatory agency and even by-passed the regulatory agency when the water company wanted to renegotiate the contract. Finally, the role of international financial institutions in this process is discussed.
Loftus et al. (Mon,) studied this question.