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Bechtel vs. Bolivia

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Bechtel Sues Bolivia
 
WASHINGTON - August 29 - More than three hundred
> citizens groups from 41
> >countries presented a petition today to a World
> Bank-affiliated court,
> >demanding that it allow public participation in a
> controversial case in
> >which Bechtel Corporation is suing Bolivia for $25
> million. (Petition and
> >support letter available at:
> http://www.earthjustice.org/news/display.html?
> >ID=435)
> >
> >Bechtel is suing South America's poorest country for
> a portion of the
> >profits it wasn't able to earn after a public
> uprising in response to
> >Bechtel's water rate hikes forced the company to
> depart from the country in
> >April 2000. Bechtel's legal action is being heard by
> the International
> >Centre for the Settlement of Investment Disputes
> (ICSID), an international
> >tribunal housed at the World Bank that holds all of
> its meetings in secret.
> >
> >"Bechtel is demanding $25 million dollars from some
> of the poorest families
> >in the world," said Oscar Olivera, a leader of the
> coalition of Bolivian
> >peasants, workers and others that formed in
> opposition to Bechtel. "The fact
> >that a World Bank court is preparing to hear this
> case behind closed doors,
> >without any public scrutiny or participation, is a
> clear example of how
> >global economic rules are being rigged to benefit
> large corporations at the
> >expense of everyone else."
> >
> >A wide range of groups joined in the demand to open
> up the process. They
> >include trade union organizations (e. g., the 2.5
> million-member Canadian
> >Labour Congress and Public Services International,
> which represents services
> >sector workers around the world); environmental
> groups (e. g., Friends of
> >the Earth); consumer organizations (e. g., consumers
> associations of Canada,
> >Japan and Zambia and U. S.-based Public Citizen);
> research groups (e. g.,
> >Institute for Policy Studies in Washington,
> Transnational Institute in
> >Amsterdam, and the Integrated Social Development
> Centre in Accra); and
> >numerous religious institutions (e. g., Maryknoll
> Fathers and Brothers in
> >Peru and the American Friends Service Committee); as
> well as noted authors
> >Naomi Klein, Maude Barlow and Vandana Shiva.
> >
> >The groups called on the panel to make all of the
> documents and meetings in
> >the case public, to travel to Bolivia to receive
> public testimony, and to
> >allow Bolivian civic leaders to be an equal party to
> the case.
> >
> >The citizen's letter will be accompanied by a formal
> "petition to
> >participate" by Olivera and other Bolivian civic
> leaders to the ICSID
> >tribunal hearing the case. The tribunal is comprised
> of one member appointed
> >by Bechtel, one appointed by the Bolivian government
> and a third, its
> >president, appointed directly by World Bank President
> James Wolfensohn. The
> >ICSID panel is scheduled to hold its first hearing
> sometime in early
> >September (though Bank officials say they are barred
> from disclosing exactly
> >when or where the hearing will take place).
> >
> >The legal team representing the Bolivian petitioners
> includes Oakland,
> >CA-based Earthjustice and the Washington, DC-based
> Center for International
> >Environmental Law, both of which have been involved
> in attempts to intervene
> >in similar investor-state lawsuits filed under the
> North American Free Trade
> >Agreement.
> >
> >AFTERMATH OF A REVOLT AGAINST WATER PRICE HIKES
> >
> >In the late 1990s the World Bank forced Bolivia to
> privatize the public
> >water system of its third-largest city, Cochabamba,
> by threatening to
> >withhold debt relief and other development
> assistance. In 1999, in a process
> >with just one bidder, Bechtel, the California-based
> engineering giant, was
> >granted a 40-year lease to take over Cochabamba's
> water, through a
> >subsidiary the corporation formed for just that
> purpose ("Aguas del
> >Tunari").
> >
> >Within weeks of taking over the water system, Bechtel
> imposed huge rate
> >hikes on local water users. Families living on the
> local minimum wage of $60
> >per month were given bills equal to as much as 25
> percent of their monthly
> >income. The rate hikes sparked massive citywide
> protests that the Bolivian
> >government sought to end by declaring a state of
> martial law and the
> >deployment of thousands of soldiers and police. More
> than a hundred people
> >were injured and one 17-year-old boy was killed. In
> April 2000, as
> >anti-Bechtel protests continued to grow, the
> company's managers abandoned
> >the project.
> >
> >Bechtel filed the legal action against Bolivia last
> November, demanding
> >compensation of $25 million, a figure that represents
> far more than
> >Bechtel's investment in the few months it operated in
> Bolivia. Bechtel's
> >action also aims to recoup a portion of the company's
> expected profits from
> >the project. The company filed the case with ICSID
> under a bilateral
> >investment treaty between the Netherlands and
> Bolivia. Although Bechtel is a
> >U. S. corporation, it established a P. O. box
> presence in the Netherlands in
> >order to make use of the treaty.
> >
> >The rules in the Dutch-Bolivian treaty are similar to
> those in NAFTA and the
> >proposed Free Trade Area of the Americas. According
> to Sarah Anderson,
> >Director of the Global Economy Project at the
> Institute for Policy Studies
> >in Washington, DC, "There's been an outpouring of
> international support for
> >the Bolivian petitioners in this case. So many people
> have become familiar
> >with such investor-state lawsuits from the NAFTA
> experience and they see
> >them as one of the most extreme examples of excessive
> power granted to
> >corporations." According to Anderson, "The Bechtel v
> Bolivia case could be a
> >preview of what is to come if the FTAA is enacted.
> That agreement would give
> >foreign investors throughout the hemisphere the right
> to sue governments
> >directly over laws or regulations that might diminish
> their profits."
> >
> >__________________________________________________
> >
> >Corporate, World Bank and Bolivia contacts:
> >
> >Bechtel Corporation: Jock Covey External Affairs
> Department Bechtel
> >Headquarters San Francisco, CA
> >(415) 768 5444
> >
> >ICSID: Claudia Frutos-Peterson Counsel handling the
> case World Bank
> >Washington, DC
> >(202) 458-7930
> >
> >World Bank James Wolfensohn President Washington, DC
> >(202) 473-1000 [note: This is the World Bank's
> general #]
> >
> >Government of Bolivia Alberto Valdes Charges
> d'Affaires in the Bolivian
> >Embassy in Washington, DC
> >(202) 483-4410
> >
> >__________________
>


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