Water Grabs

Via Farmland Grab, a look at what some call water grabs:

In a world running out of accessible water, the question of control looms large. Is water a human right, a public trust and common heritage or a commodity to be put on the open market like oil and gas?

Water grabs

The fear over future food shortages has led wealthy countries, international investors and commodity traders to buy up massive amounts of land in the global South either to feed their own populations or as speculative investments. An area almost three times the size of the United Kingdom has been “grabbed” at rock bottom prices. Investors are getting incredible deals, some leasing massive tracts of land for 99 years for as little as 40 cents per acre per year.

Over one fifth of Cambodia’s land mass has been leased to private interests, displacing almost half a million people. Ethiopia is one of the hungriest countries in the world, yet its government is offering up huge swaths of its most fertile land to speculators to grow food for export.

These land grabs are also water grabs, as investors need guaranteed access to water supplies for what are essentially export crops, devastating local watersheds. Not only do these big agro-investors choose the best land for their crops, they tie up access to the water rights of local streams, rivers and aquifers. An alarming number of countries are signing away their water rights for decades to come, mostly at fire sale prices.

The amount of water required in Africa to cultivate the land acquired in 2009 alone is twice the volume of water used for agriculture in all of Africa just four years earlier. If land grabs continue at current pace, demand for fresh water will overtake the existing supply of renewable water in Africa in five years. Some are calling this “hydrologic suicide.”

Water is at the heart of other displacements as well. Capital-intensive high-technology, large-scale “free trade zones” displace 15 million people every year. As well, farmlands, fishing grounds, forests and villages are converted into reservoirs, irrigation schemes, mines, plantations, highways, urban developments, industrial complexes and tourist resorts. In this way, and sanctioned by governments, private interests gain control of water that once sustained whole populations.

Water is also “grabbed” and commodified in other ways as well.  Corporate interest in the world’s dwindling clean water sources has been building for three decades but has dramatically increased in recent years. Transnational corporations view water as a saleable and tradable commodity, not a common asset or public trust, and are set to create a cartel resembling the one that now controls every facet of energy, from exploration and production to distribution.

Many poor countries have been strong-armed to contract water services to private for-profit utilities, a practice that has spawned fierce resistance by the millions left out due to poverty. Now, under the guise of austerity, the Europe Union is also promoting private water and wastewater services as well.

Other struggles are taking place with bottled water companies who drain vast amounts of water from local watersheds to sell. Some countries, such as Chile, auction off raw water in lakes and rivers to global interests such as mining companies that now literally own the water that used to belong to everyone. Private corporations control huge quantities of water used in industrial farming, mining and energy production and own and operate most of the world’s dams, pipelines, desalination plants and urban infrastructure.

And several countries, including Australia, Chile, the U.S. and Spain, have introduced water markets and water trading, whereby a water licence is converted to private property and private investors and industrial agribusiness hoard, buy, sell and trade raw water on the open market to those who can afford to buy it.  In all of these cases, water becomes the private property of those with the means to buy it and is increasingly denied to those without.
Even governments cannot compete with the market. Private investors and water brokers drove the price of water through the ceiling when water trading was introduced in Australia. When the Australian government tried to buy back the water it gave away for free in order to rescue the endangered Murray Darling River, it could not afford to do so.

Impacts on local communities and the environment

The impact of this water plunder on local communities and their environment has been devastating.  Untold millions of local small farmers and indigenous people have been thrown off their land to make way for land grabs. With them gone and their land and water used to grow crops for export, local communities are going hungry and without water.

As well, local, sustainable, biodiverse farming is being replaced with the worst models of industrial agribusiness, complete with water pollution from the use of chemicals, over-extraction of groundwater and flood irrigation. Those thrown off the land are the very people who know how to dryland farm, rotate their crops to protect their water sources and live with the fluctuations of drought and floods that characterise much of the world.

These displaced farmers join other climate refugees and communities forcibly removed from their land to make way for free trade zones, mega-dams, energy megaprojects and industrial sites where they migrate to peri-urban slums that ring the developing world’s cities. There, many have no access to clean water or sanitation at all, sometimes because these slums are not formally recognized, or because the price of often-privatized water is out of their reach.
You know the terrible numbers – more children die of water-borne disease than all forms of violence together, including war. The UN assures us that it is closing the water access gap but I have my doubts. To assess its Millennium Development Goal regarding water, it counts the number of new pipes installed in a country. But a pipe may not have clean water coming out of it. It may be very far away. And it may be metred, putting it out of the reach of the poor.

I personally believe that declining global water supplies due to pollution, mismanagement and displacement of water from watersheds is leading to a greater crisis than ever. UN Habitat says that by 2030, more than half the populations of large urban centres will be slum dwellers with no access to water or sanitation services whatsoever.

And lest we think these abuses are relegated to the global South, it is important to know they loom in the North as well. Over 90,000 inner city poor in Detroit Michigan have had their water cut off for lack of ability to pay and many thousands more are to be cut soon. And thousands have had their water cut off or been evicted from their homes in Bulgaria, Greece, Spain and Portugal.

Who is driving water grabs?

None of these human rights and environmental abuses had to happen. All could have been avoided by good public policy and true international cooperation. But in the last several decades, most governments and international institutions have adopted an economic model that favours unlimited market growth, dramatically reduced powers of government, financial and resource deregulation, so-called “free” trade across borders and growing corporate power.

The World Bank, backed by the European Union and European banks, continues to promote privatization of water services in the global South even though many of these contracts have been a complete failure. Moreover, funding for these services is going directly to water utilities such as France’s Suez and Veolia, bypassing governments, and the World Bank is now even investing directly in these companies.

The International Finance Corporation of the World Bank also heavily funds the global agro-business industry in the global South and asserts that the high cost of food offers unique opportunities for poor countries to capitalize on the very land grabs that are destroying them. The World Bank even works with governments in poor countries to change their land laws to increase the permissible quantity of land under foreign ownership and even has a global “business ranking” that favours those governments that make life easiest for land-grabbing investors.

Another disturbing trend is the privatization of foreign aid. Increasing amounts of public aid money is being transferred not to governments, but to the private sector, giving corporations more power to set local policy. A report by the European Network on Debt and Development found that most of the aid from the World Bank and the European Investment Bank in the last decade went to private tax havens and corporations based in the global North, much of it to commercial banks, hedge funds, and private equity funds.

Some governments – such as my own in Canada – are only funding aid agencies that will cooperate with the goals of their corporations doing business in the targeted country. Water activists in Latin America fighting the destruction of their local water sources by Canadian mining companies, can no longer turn to Canadian aid agencies for help.

As aid is privatized, local aid groups are politicized as well. African water justice activists report that only local groups who favour privatization and land grabs are being funded for their work.

The new generation of trade and investment deals is another huge impediment to the human right to water. These deals have nothing to do with lowering tariffs and opening trade and everything to do with limiting the power of governments at all levels to protect the rights of their people, their resources or their environment.

This new generation of trade deals, such as the Canada-EU Comprehensive Economic and Trade Agreement (CETA) and the EU-US Transatlantic and Investment Partnership (TTIP) include investor-state clauses that give foreign corporations the right to sue each other’s governments if they believe their “right to profit” will be affected by domestic laws and regulations.

We in Canada have lived with this horrible corporate power for 20 years now and it has absolutely negatively impacted our ability to protect our water from American corporations in very real ways. Under CETA, we will lose much of our ability to keep our water in public hands. Suez and Veolia can hardly wait.

There are now almost 3,000 bilateral agreements in the world, many of which contain the rights of corporations to directly sue governments for compensation if their bottom line is affected by domestic laws and practices. Imagine the impact of these deals on poor countries trying to protect their water supplies from foreign plunder.

Importantly, investment-state treaties give foreign land and water grabbing investors the right not just to the crops they are growing, but the actual land and water used to grow them.

This isn’t just speculation. In 2010, the Canadian government paid $130 million to an American pulp and paper company that abandoned its operation in Newfoundland, leaving workers without jobs or pensions. The company sued under the investor-state provision of the North American Free Trade Agreement, arguing that the water it used for decades actually belonged to the company, and a dangerous precedent was set that could be replicated elsewhere.

Under these rules, if a country now allowing land and water grabs decides to take back control of these resources, it would have to be prepared to pay potentially huge amounts of compensation for the basic right to govern itself.

There has been great concern raised in Europe over investor-state recently, but unfortunately, in spite of the fact that there is a public consultation under way in Europe right now over this issue, the European Parliament recently agreed on a framework for managing the financial ramifications of this corporate gift instead of rejecting it outright.

What can we do to prevent water grabs and realize the right to water?

Economic globalization, with its emphasis on growth at all costs, its servitude to the 1%, its systematic enclosure of the commons, its entrenchment of corporate rights in international trade law and its displacement of the local caretakers of land and water everywhere, is a sure-fire recipe for water disaster.

The solution to the global water crisis must include a renunciation of this model of growth if there is any hope it will be successful. Tax havens must be shut down. The rule of law must be brought to bear on transnational capital.

Trade must be radically reformed to serve a different set of goals and come under democratic oversight. Corporations must lose the right to sue governments. Investor state must be banned in all countries as it has been in Australia, Brazil and Bolivia. As well, all references to water as a tradable good, service or investment must be removed from trade agreements. Corporations and trade deals must in no way be used to prevent the domestic or international protection of water.

Land and water grabs must end. We need an international moratorium on large-scale acquisitions and plundered land must be returned. Real food security in Africa and elsewhere will come from genuine agrarian and aquatic reform and targeting public investment to community and family farming.

A new water ethic

By 2030, our global demand for water will outstrip supply by 40 per cent, a sure-fire recipe for great suffering. Five hundred scientists recently told UN Secretary General Ba Ki-moon that our collective abuse of water has caused the planet to enter “a new geologic age” and that the majority of planet’s population lives within 50 kilometres of an impaired water source.

We need a new water ethic that places water and its protection at the centre of all policy and practice if the planet and we are to survive.

This new water ethic should honour four principles.

The first is that water is a human right and must be more equitably shared.  In 2010, the UN General Assembly formally recognized the human right to water and sanitation. Not long after, the Human Rights Council spelled out just what this means. While the resolution was silent on the issue of water ownership, the Council was clear that this new right is binding on governments and clearly set out their obligations and responsibilities in making it real.

Not only are all governments now responsible for setting up a plan to deliver safe, affordable, clean water to their people, they have to prevent third parties from interfering with this new right. Corporations, such as agro-corporate land and water grabbers that are polluting or over-extracting local water sources, can be seen as violators of the human right to water. This provides an important tool to local communities in mining, dams and energy-extraction struggles around the world.

The second is that water is a common heritage of humanity and of future generations and must be protected as a public trust in law and practice. Water must never be bought, hoarded, sold or traded as a commodity on the open market and governments must maintain the water commons for the public good, not private gain. While the private sector has a role in helping find solutions to our water crisis, it must never be allowed to determine access to this basic public service as its need to find a profit will of necessity come before the public good.

The third is that water has rights too, outside its usefulness to humans. Water belongs to the earth and other species. Our belief in “unlimited growth” and our treatment of water as tool for industrial development have put the earth‘s watersheds in jeopardy. Water is not a resource for our convenience, pleasure and profit, but rather the essential element in a living ecosystem. We need to adapt our laws and practices to ensure the protection of water and the restoration of watersheds, a crucial antidote to global warming.

Finally, I deeply believe that water can teach us how to live together if only we will let it. There is enormous potential for water conflict in a world of rising demand and diminishing supply. But just as water can be a source of disputes, conflict and violence, water can bring people, communities and nations together in the shared search for solutions.

Water survival will necessitate more collaborative and sustainable ways of growing food, producing energy and trading across borders, and will require robust democratic governance. It is my deepest hope that water can become nature’s gift to humanity and teach us how to live more lightly on the earth and in peace and respect with one another.

Eleanor Roosevelt said: “The future belongs to those who believe in the beauty of their dreams.”

Well, I believe in the beauty of this dream: that our global water crisis will become the source of global peace; that all humanity will understand that water is the source of life and bow before the need to protect and restore watersheds; and that through our work together, the peoples of the world will declare that the sacred waters of life are a human right as well as the common property of the Earth and all species, to be preserved for all generations to come.

This entry was posted on Friday, May 16th, 2014 at 12:36 pm and is filed under Uncategorized.  You can follow any responses to this entry through the RSS 2.0 feed.  You can leave a response, or trackback from your own site. 

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About This Blog And Its Author
Seeds Of A Revolution is committed to defining the disruptive geopolitics of the global Farms Race.  Due to the convergence of a growing world population, increased water scarcity, and a decrease in arable land & nutrient-rich soil, a spike of international investment interest in agricultural is inevitable and apt to bring a heretofore domestic industry into a truly global realm.  Whether this transition involves global land leases or acquisitions, the fundamental need for food & the protectionist feelings this need can give rise to is highly likely to cause such transactions to move quickly into the geopolitical realm.  It is this disruptive change, and the potential for a global farms race, that Seeds Of A Revolution tracks, analyzes, and forecasts.

Educated at Yale University (Bachelor of Arts - History) and Harvard (Master in Public Policy - International Development), Monty Simus has long held a keen interest in natural resource policy and the geopolitical implications of anticipated stresses in the areas of freshwater scarcity, biodiversity reserves & parks, and farm land.  Monty has lived, worked, and traveled in more than forty countries spanning Africa, China, western Europe, the Middle East, South America, and Southeast & Central Asia, and his personal interests comprise economic development, policy, investment, technology, natural resources, and the environment, with a particular focus on globalization’s impact upon these subject areas.  Monty writes about freshwater scarcity issues at www.waterpolitics.com and frontier investment markets at www.wildcatsandblacksheep.com.