Water privatisation? Finland says no!

In early January 2020, the municipality of Jyväskylä, located in the Central Finland Region, announced its intention to part-privatise between 30 and 40 per cent of its multi-utility company Alva, including water, energy and heating. Bringing in expertise from the private sector would better equip the company to tackle current market challenges, the municipality stated. Moreover, mirroring water privatisation arguments elsewhere, privatisation was said to promise increased efficiency and lower consumer prices. However, the announcement led to an immediate public outcry. Several critical opinion pieces appeared in various Finnish daily newspapers, and activists from the Left Alliance party launched a public petition to push the Finnish parliament into action. On 10 February, Jyväskylä announced that it had withdrawn its proposal. In this post, Dominika Baczynska Kimberley and Andreas Bieler trace the dynamics underlying this quick turnaround.

Water privatization in Jyväskylä, Finland?

Photo by Sampo Sikiö

Jyväskylä is the first Finnish municipality, which has decided to part-privatize its water services, intending to sell 30 per cent of the municipal company. What may look as an attractive option at first sight to generate finance for the municipality, is however a potentially highly dangerous initiative. The experiences of water privatizations elsewhere in Europe counsel caution.