Bachoco, Cemex, Nestlé, Bimbo, Cuauhtémoc Moctezuma, and Modelo breweries, Compañía Maya de Agua Purificada, Envasadoras de Aguas de México, Agra, Femsa Coca-Cola, Pemex, and CFE head the list of bottling companies hoarding the country’s water reserves. To these, one’s must include mining houses and agro-industries. Authorities have granted 536 thousand concessions of surface waters, groundwaters, and closed areas. Due to excessive exploitation, 16 states risk reaching the «Day Zero,» in other words, the total exhaustion of their water resources.
Large national and foreign enterprises hoard Mexico’s water reserves. Companies such as Bachoco, Cementos de México (Cemex), Nestlé, Grupo Bimbo, Cuauhtémoc Moctezuma and Modelo breweries, Compañía Maya de Agua Purificada, Envasadoras de Agua de México, Embotelladora Aga, Grupo Femsa Coca-Cola, Petróleos Mexicanos (Pemex) and the Federal Electricity Commission head the list of moral people who, every year, exploit over 5 million cubic meters, or better, over 5 billion liters.
Moreover, it is important to figure in mining houses and large agro-industries that benefit from hundreds of licenses and permits to extract water indiscriminately. Since 1992 the Mexican authorities have been awarding 536 thousand concessions so far.
Bottling companies are among the most benefitted, reveals the Public Register of the Water Rights (Registro Público de Derechos de Agua – Repda) of the National Water Commission (Conagua). This database gives an account of more than 300 concessions in the hands of such an industry. Coca-Cola, through Cielo, Dasan, Compañía Topo Chico, and Smart-Water; Pepsi Cola through E-Pura, Santorini, and Gatorade. Danone with Bonofant, Evian, and Voltic, and Nestlé through Santa María, Perrier and Pellegrino.
Regarding Coca-Cola, this company owns the exploitation permit for the utilization of water to produce beverages of the different brands it owns, such as Sprite, Fanta, and Mundet. Through Femsa and Arca Continental, the US company holds over 100 concessions within the country.
The transnational companies of such an industry pool, not only benefit from the hoarding of Mexico’s reserves but also the increase in the sale of bottled water. Mexico is indeed the third country with the highest consumption of bottled water in the world, which translates into a daily waste of 21 million PET packagings.
Envasadora de Agua de México and Embotelladora Aga also appear on that list. They rely on 30 and 24 exploitation permits, respectively. Whereas, Compañía Maya de Agua Purificada and Grupo Modelo hold 69 and 11 each.
Breweries are other privileged companies in this concession system. Only in the State of Mexico, Cuauhtémoc Moctezuma Brewery owns 22 exploitation permits for the usage of surface and subterranean water sources. Of these twenty permits, the company which distributes Heineken beer holds two concessions to exploit groundwater for two and one million cubic meters per year.
When revising the database of Repda – of Conagua – the enterprise does not figure in the registers of permits for industrial discharges in the State of Mexico. On the contrary, it only records a permit for discharge under the concept of “different usage” – permit no. “08MEX100666/12IMDL12”.
The company officially reports a discharge volume of 1 million 164 thousand cubic meters yearly. However, this permit does not appear in the register of permits to exploit water for «different usages.»
Nonetheless, it is not an isolated case. Regrettably, the instances of multinationals and large Mexican enterprises with privileged situations are frequent in the country. According to the information that Repda provided, the organization Agua para Todos points out that there are 5 thousand 964 industrial water wells and 455 water intake systems for industrial usage that do not count on permits for discharge. «This way they avoid inspections and fees collections,» Repda assures.
Besides the case of bottling companies and breweries, whose business utterly depends on water exploitation, the register of the National Water Commission reveals that Pemex holds 989 concessions, being the enterprise with most granted concessions in Mexico.
Other companies with an indiscriminate consumption of water are Bachoco, with 375 concessions, the Federal Electricity Commission with 69, Cementos de México with 50, Grupo Nestlé with 43 and Grupo Bimbo with 29.
The risk of reaching the Day Zero
Surface and ground waters and even water bodies located in closed areas have been given in concession for private interests, complain civil organizations that protect water. While large enterprises are monopolizing this national good, over 44 thousand Mexicans lack daily water provision in their homes, reveals the National Institute of Statistics and Geography.
Moreover, the World Resources Institute warned that Mexico is approaching the dreaded Day Zero, as they named the imminent risk of water shortage. In their most recent report, the international organism pointed out that five areas are living in a «situation of highly critical hydric stress»: Baja California Sur, Guanajuato, Mexico City, Aguascalientes, and the State of Mexico. Whereas, other 11 areas live in «hydric stress» due to the overexploitation of different water sources and to the fact that they employ a higher volume of water than they have available. The problem is that over 87 billion cubic meters of water are extracted yearly in the country.
Despite the imminent risk, the authorities systematically do not protect this resource. The organization Agua Para Todos alerts that the system of concession put in place by Conagua offers new permits to extract water in the states mentioned above. Furthermore, the organization blames their lack of precaution, favoring privates, and human rights violations – mainly the right to equitable access to water.
Elena Burns, a member of the National Coordinating body Agua Para Todos, ensures in an interview with Contralínea that the system of «water purchase and sale» in the country dates back to 1992 when the North America Free Trade Agreement was signed. This treaty, she explains, imposed «a set of laws» on the country among which the controversial Law on National Waters (Ley de Aguas Nacionales) stands out.
«This law imposes a system of concessions on us where a concession is intended as an object of purchase and sale, far different from the conception of water as a national good. In the United States, there is not even a unique system of concessions, but it was imposed on Mexico», ensures the environmental activist.
What is more, Burns explains that from 1917 to 1992 – when the legislation parallel to the Trade Agreement entered into force – they awarded only 2 thousand concessions. Nonetheless, since then, they have been granting 538 thousand so far. «When we talk about the privatization of the water, it is for real,» she claims.
Data from Conagua reveal that the sector that holds concessions the most is agricultural, with 233 thousand 126. It is followed by the urban public sector, with 129 thousand 583, another denominated as «different usages» with 50 thousand 720, the livestock industry with 47 thousand 429, the service and domestic sectors with 24 thousand 977 and 16 thousand 595 respectively. The list goes on with the industrial sector holding 8 thousand 573 concessions, aquaculture with 1 thousand 575, other industries with 289, and finally, the sector producing electric energy with 159 concessions.
In most of the cases, these concessions are granted for 30 years with automatic renovation up to the same amount of time. Hence, in spite of the Political Constitution of Mexico establishes that water is a national good, in practice, private interests are favored, observe human rights defenders.
The Law on National Waters
In force since 1992, the Law on National Waters is held responsible for paving the way to water hoarding. In its Article 24, it establishes that the duration of a concession will not be shorter than five years nor longer than 30 years. Moreover, it foresees an automatic renovation for a length equal to the requested, leading to 60-year-long concessions.
«The Law on National Waters gets its foundations in the antithesis of the principle of equitable access and sustainable usage of water. Indeed, it allows that few individuals and few enterprises control huge volumes of water,» affirms in an interview Miguel Montoya, a legal advisor and expert in the human right to water.
Due to the flexibility of this legislation, enterprises such as Coca Cola, Danone, Nestlé, Pepsi Cola, Cuauhtémoc Moctezuma Brewery and Bachoco, have made giant steps toward the acquisition of water concessions, reveals the federal authorities’ database.
According to the report on Water Statistics by Conagua, 76 percent of the whole volume of waters given in concession to the country are allocated to agricultural usage. In Chiapas, for instance, in the municipality of Suchiate, a concession for farm usage amounting to 141 million cubic meters every year appears under the name of Users of the Irrigation Department of Suchiate. The situation, visibly unequal, becomes even more evident when comparing the permits for concession given to producers -that do not outnumber 1 thousand cubic meters yearly – to those earmarked for a large producer.
For this reason, Elena Burns ensures that the Law on National Waters not only aimed to create a system of water purchase and sale, but also various irrigation districts. “These, under the law, had been given under the users’ control. This way, they created huge entities, with enormous concessions that brought about an elite in the countryside, that throughout the years, has been displacing ejidos and communities. Hence, they have been acquiring increasingly more rights within the irrigation districts”.
As for Miguel Montoya, «the current regimen of concessions, under the Law on National Waters, is too lax and allows water hoarding. Hence the Constitution, with its rules, implies mere privatization».
Following the same reasoning, the researcher sustains that the law is so flexible that there are few to no previous revocation of concessions. Not even in the case of Grupo Mexico that contaminated the Sonora River, they revoked the permit, he observes.
Montoya explains that as foreseen by Articles 29 bis, 3, and 4 of the Law, the concession could have been revoked, but it did not happen. This case highlights the over tolerance that the country showed to private groups to allow them taking possession of the water.
Furthermore, the decree issued by former president Enrique Peña Nieto made water hoarding even more common practice. It, indeed, turned 245 river basins and 108 closed areas into employable water reserves. Hence, following this decree, 362 new concessions were granted, primarily for farm usage.
Even though we are currently in the «fourth transformation,» the interviewees agreed that so far, the situation has not changed. With the new platform «Conagua Digital» – that awards online concessions – coming into force, organizations and researchers are afraid that this would benefit one more time private entities instead of communities.
However, the deputy director for administration of Conagua, Eugenio Barrios, ensures Contralínea that if in previous presidencies, the rights of indigenous communities were violated, in this administration, it would not occur. Questioned about the matter – during the Latin American Congress on River Basins held in Mexico City – the official claims that currently there are a set of rules to grant concessions.
«Conagua Digital,» the new peril
In August 2019, the National Water Commission launched the platform «Conagua Digital.» Through it, they aimed to facilitate the process of request for concessions and guarantee that the highest number of people could access it. According to the National Coordinating body Aguas Para Todos, it is a way to put up for «sale» the country’s water sources until drying them up. It translates into putting at peril the rights of ejidos, communities, and indigenous peoples. Conagua Digital could also grant concessions in those areas having a high risk of reaching the Day Zero.
On the contrary, the legal advisor Miguel Montoya considers that the new concession system does not privatize water in the strict sense of the term, as the nation never loses jurisdiction over the resource. He, instead, emphasizes that the existence of political and economic groups’ interests is undeniable. Indeed, since 2012 they have been slowing down a reform of the Law on National Waters favoring equitable access to water and the human right to water.
Both Miguel Montoya and Elena Burns sustain that before opening a new concession process, they should have reformed the Law. Since 2011 they have been promising that reform would take place, as it is fundamental to achieve equitable access and sustainable usage of water.
All the interviewees agree that the reform must prohibit «the transfer of water right ownership,» in other words, the purchase and sale of concessions should be banned. They explain that, as the current law puts it, a person who owns a concession is allowed to sell part of it to a third party if they wish so. Elena Burns ensures that such transfers are permitted even for usages other than those for which the concession was acquired; «this can be done freely, only paying the right to ownership transfer.»
Moreover, Miguel Montoya warns about another risk concerning water transfers. This new system, besides providing easier ways to renew concessions, also sets the bases for a bad trend: the small producer ends up abandoning their water resources and migrating to the United States for poverty and violence issues.
«There is always a series of coyotes strictly interwoven with the water authority that is awarded the concession. Then it is transferred to a mining house, a petrol enterprise, an industry or a large producer because the law foresees it as an agreement among individuals», he explains.
In Miguel Montoya’s opinion, transferring a water right ownership is the most «lascivious» aspect of the law. Indeed, a contract among individuals – subsequently registered at Conagua – is sufficient to finalize the purchase and sale of concessions. «This may cost up to 30 million Mexican pesos, and the Conagua official who is linked to the coyote even gets a percentage on it».
On this matter, the deputy director for the administration of Conagua, Eugenio Barrios, ensures Contralínea that these transfers «can be done provided that water usage is the same, in the same area and that no permit conditions are modified.»
He also adds that the various decrees issued set out rules for some water right transfers. «For instance, water for human use cannot be transferred. It is already a restriction. However, if I own a water right for industrial usage and another industrialist happens to ask for it, the rule foresees that it can be transferred».
Eugenio Barrios underlines the urgency for the next law to prohibit the transfer of water rights clearly and convincingly. They could be transferred «only to an immediate relative for heritage matters.» It is urgent because the transfer system has favored both hoarding and people displacement.
Miguel Montoya believes that it is necessary to understand who Eugenio Barrios is – the current deputy director for the administration of Conagua – to understand the level of water hoarding in the country. «He was the father of the privatizing decrees, although, with intellectual honesty in the strict meaning of the word, they are not privatizing.» However, the system created by the Law on National Waters makes them practically privatizing». Barrios assisted in the drafting of the controversial Law Korenfeld (called after the former director of Conagua, David Korenfeld), known as the gateway to privatization. That is why, he says, «Conagua keeps being the same neoliberal institution.»
The expert in the human right to water warns that authorities and privates who request for a concession employ an incorrect usage of the concept of «afirmativa dicta.» This concept implies that if the authority does not address the complaint within a maximum period of 60 days, the complainant has the automatic right to it. Although the Law on National Waters does not allow such a situation, in practice, it is different. «They [the economic groups] always opt for those concessions which renew automatically.»
Some enterprises with a higher number of concessions in Mexico
|Enterprise||Number of concessions|
|Compañía Maya de Agua Purificada||69|
|Comisión Federal de Electricidad||69|
|Cementos de México||50|
|Envasadoras de Aguas de México||30|
|Cuauhtémoc Moctezuma Brewery||22|
|Electrical Energy Generation||159|
By Lauren Franco
(Translated by: Federica Antoniani)