The turbulent waters of privatization in Mexico

By Claudia Campero Arena, Monday, July 25th, 2011

“The turbulent waters of privatization in Mexico” (in Spanish “Las turbias aguas de la privatización en México”) is a magazine intended to update the diagnosis of the current situation of some cities in Mexico regarding water privatization. The aim is to provide information and critical analysis from the perspective of civil society regarding water management. We hope this brief study will be useful to build awareness and to defend the human right to water.

This publication discusses the different forms of water privatization and three cases of cities in Mexico: Saltillo, Mexico City (specifically the Federal District) and Guadalajara. Each case shows different degrees of water privatization, but all identify important problems with the management of these city water systems.

Concerning the different privatization forms, we discuss bottled water, private hydro infrastructure such as dams and treatment plants, water pollution (with companies using rivers as free dump sites, transforming a public good into a public evil), and privatization of municipal water services.

Saltillo is the most advanced privatization case we studied. Since 2001, it became a mixed company where Aguas de Barcelona owns 49% of the water system, and defines management. Soon after, the company increased its commercial efficiency mainly cutting off all those who were unable to pay for the service. They even cut collective faucets shared by hundreds of people. In the borough Heroes de Nacozari, for instance, neighbors were unable to pay for the collective faucet that has now been cut off and girls are currently responsible of collecting water from a water spring for their families.

Mexico City has had service contracts since 1993 with four companies that are distributed each in one of four sections of the city. These four companies include associations of national corporations and the huge French water transnationals Suez and Veolia. Since then, it has been impossible to obtain information of how the local government evaluates these companies’ performance. However, the originally 10 year contracts have been renovated several times without any public debate. Informally, people working in the water system admit that the performance of the companies is inadequate.

Finally, Guadalajara’s case is an example of how pressure to privatize is built. This is a public utility that has received “recommendations” by private consultants to become increasingly privatized. It already outsources tasks that were previously undertaken by its employees. Also this case shows how infrastructure is privatized through BOT (Built, Operate and Transfer) formats for treatment plants and dams.

“The turbulent waters of privatization in Mexico” is a joint effort of the Coalición de Organizaciones Mexicanas por el Derecho al Agua, the Instituto Mexicano para el Desarrollo Comunitario, Food and Water Watch y Council of Canadians.