10 Feb Bechtel Abandons its ICSID Claim Against Bolivia
In an era in which transnational corporations have become wealthier and more powerful than many countries – GM alone is worth more than 120 – it’s easy to dismiss anti-corporate political activism as naïve, anachronistic, and doomed to failure. But that’s not always true. Case in point: the Bechtel Corporation’s recent abandonment of its claim against
The seeds of the dispute were planted in 1997, when the World Bank informed
Eighteen months later, in November, 2002, Bechtel filed its $50 million claim with ICSID. The claim was not only for recovery of its lost investment, which amounted to less than $1 million, but also for the profit it claimed to have lost when Bolivia annulled Aguas del Tunari’s contract.
Bechtel’s suit was no more popular than the increase in water rates, largely because of ICSID’s lack of transparency and accountability. ICSID proceedings are closed to the public and press and the tribunal operates outside of national laws – the judges in each case define the applicable norms and procedures. Decisions by the tribunal are not appealable, and a country faces economic sanctions if it does not comply with its rulings. So after a petition to appear before ICSID filed by 300 organizations in 43 different countries was denied, activists took to the streets. Thousands sent e-mails to corporate executives. Protesters in
Finally, Bechtel gave in and withdrew its claim. Sources say that Bechtel’s CEO, Riley Bechtel – weary of having his corporation painted as the poster-child for corporate greed – made the decision himself.
Although the case obviously represents a victory for the poor Bolivians in
But they are not always successful. Sometimes political activism can make a difference. And therein lies the victory over Bechtel’s true importance.