This arbitration raises a number of issues of vital concern to the local community in Tanzania, and a wide range of potential issues of concern to developing countries (and indeed all countries) that have privatized, or are contemplating a possible privatization of, water or other infrastructure services. The arbitration also raises issues from a broader sustainable development perspective and is potentially of relevance for the entire international community.
In the UN Millennium Declaration, the international community committed itself to halve, by the year 2015, the proportion of people who are unable to reach or to afford safe drinking water. The privatization at issue in the present arbitration was conceived to work towards this goal. It has been described as “one of the most ambitious in Africa and was intended to be a model for how the world’s poorest communities could be lifted out of poverty and countries could meet their millennium development goal targets.”
This was a critical project, watched by a wide range of observers. In few sectors is the relationship of service delivery to basic human rights and needs more salient than in the water sector. In addition, the management of water services relates closely to environmental management of water resources. Indeed, this Tribunal seems to implicitly recognize the multifaceted importance of this arbitration by explicitly noting “the public nature of this dispute and the range of interests that are potentially affected.”
Like the Aguas Argentinas case, the present dispute involves a water services agreement. The above statement of the Aguas Argentinas tribunal stresses what is also true for the present dispute, namely that the arbitration process goes far beyond merely resolving commercial or private conflicts, but rather has a substantial influence on the population’s ability to enjoy basic human rights. This aspect of the case means that the process should be transparent and permit citizens’ participation.