[Debate] (Fwd) Green Economy profiteers: World Resources Institute's water commodification mapping (Joyce Nelson)

[Patrick Bond]

*Who's Profiting from the Water Crisis?
*
     Joyce Nelson 2 June 2012

In January 2010, investment banker Goldman Sachs, along with General 
Electric and a high-powered Washington thinktank called the World 
Resources Institute (WRI), announced the launch of a new index measuring 
water-related risks facing companies and their investors.
In the words of their corporate news release: 'In many regions around 
the world, water scarcity from climate change and pollution is starting 
to impact a company's performance, yet few analysts account for 
water-related risks.'

This new water index would 'draw on publicly available data regarding 
physical scarcity and water quality and overlay factors including the 
regulatory regime and social and reputational issues' in various regions 
of the world.

Business jargon aside, if you think this will be a useful tool for 
corporations, you'd be right. In fact, the risk-index might more 
accurately be called an 'opportunity-index' for water speculators and 
investors.

Next year the water privatization market worldwide is expected to reach 
$1 trillion. As Goldman Sachs puts it, 'There is no substitute for 
water. It is the only utility you ingest.' According to Maude Barlow, a 
leading Canadian critic of water privatization, 'The biggest water 
company of all is General Electric.'

By August 2011, Goldman Sachs, General Electric and WRI had not only 
found a name for their partnership -- the Aqueduct Alliance -- they had 
also developed the index into a water database and mapping tool, which 
can include the amount of infrastructure investment taking place in a 
given region.

Moreover, they had put an 'environmental' spin on the project, claiming 
that it will help corporations, governments and stakeholders become more 
aware of their 'water footprint' and thus make more 'sustainable' decisions.
That same month the original threesome -- Goldman Sachs, General 
Electric and WRI -- invited into the Aqueduct Alliance some new 
corporate partners: Coca-Cola, Talisman Energy, Dow Chemical, United 
Technologies and the financial/news conglomerate, Bloomberg LP.

The WRI's Kirsty Jenkinson told the Financial Times (FT): 'Companies see 
the need to get better visibility about water if they are going to have 
to access it for their business.' With the new water database, 'they can 
see if they are at risk of not getting the water they need, or coming 
into conflict with other users of that water'.

Presumably, the potential for 'conflict' is what attracted United 
Technologies to join the Aqueduct Alliance. UT is the world's 10th 
largest arms-producing company with sales of $11.1 billion in 2009.

Mired in controversy
Coca-Cola has handed over to the Alliance its own proprietary data on 
freshwater availability worldwide -- data collected over years of 
research for its bottling enterprises. 'Water is the lifeblood of our 
business,' Coke spokesperson Joe Rozza told the FT. The Atlanta-based 
company has hundreds of bottling-franchises worldwide, many of them 
mired in controversy. In India and Latin America, Coca-Cola has 
regularly faced irate local communities who are losing their drinking 
and irrigation water to Coke's local bottlers.
In January this year, Britain's Guardian newspaper reported that 
Coca-Cola is under fire for propping up Mswati III of Swaziland, one of 
Africa's most notorious dictators.

Poverty is endemic, political parties are banned and activists are 
regularly imprisoned and tortured in the country.

Another Aqueduct Alliance partner is Talisman Energy, a Canadian natural 
gas company based in Calgary, Alberta. 'We are very excited to have been 
asked to become the oil and gas sector sponsor for the Aqueduct 
Alliance,' Talisman spokesperson Sandy Stash told Marketwire. 'Talisman 
aspires to a water management strategy that defines best practices for 
water withdrawal, reuse, disposal and conservation in our North American 
shale gas operations.'

Just weeks earlier, in July 2011, the government of British Columbia 
(BC) awarded Talisman a licence to divert up to 10,000 cubic metres of 
water per day from the province's major hydroelectric reservoir for the 
next 20 years. Talisman uses the water to 'frack' for shale gas in 
northeastern BC. The company has also secured access to 6,200 square 
kilometres of shale gas deposits along Quebec's St Lawrence River.

The Aqueduct Alliance intends to generate databases and water-maps with 
'an unprecedented level of detail and resolution', including advanced 
hydrological data and 'geographically specific indicators that capture 
the social, economic and governance factors that affect companies and 
economies'. The databases will include up-to-date regional news coverage 
on water issues.

By September 2011, the Aqueduct Alliance had developed a prototype 
database/map covering the Yellow River Basin in northern China. Water 
shortages in China are already so severe that more than half its cities 
are facing restrictions on water use.

In 2013 the Alliance intends to release four additional database/maps on 
river basins of 'high priority', including the 2,300-kilometre long 
Colorado River in the US which has experienced years of drought; the 
Orange-Sengu River in Africa which extends across Botswana, Lesotho, 
Namibia and South Africa; the Yangtze River in China, where 10 million 
people were displaced by the Three Gorges Dam; and the Murray Darling 
River in Australia.
All are regions where water scarcity is enticing speculators to secure 
water-rights in a 'buy-and-hold' strategy. Their model is based on 
recent events in Australia.
In a short-sighted cash grab, t
he Australian government in the 1990s introduced a water market for the 
Murray Darling River Basin -- one of the longest river systems in the 
world and the heart of Australia's agricultural production. But in 2001 
a major drought struck the Basin and within a few years the federal 
government in Canberra was forced to start buying back water from 
private owners.

The price shot up. By 2009, so many speculators had targeted the Basin 
that some $3 billion in water-rights were bought and sold in that year 
alone. The government was forced to compete with international 
speculators, including giant hedge-funds.

By September 2010, the Australian government had spent at least $1.4 
billion buying back water-rights. Although the drought eased that same 
year, the fact that the Aqueduct Alliance is now focusing on the Murray 
Darling Basin means that the risks and opportunities there are still 
'high priority'.
As one hedge-fund advisor quipped, an emerging worldwide water crisis is 
creating 'serious profit opportunities for those in the know'. The 
Aqueduct Alliance database/ maps will show where those opportunities are 
located. Another 15 regions across the world will be analyzed once the 
Alliance has created its first four database/maps.

'If you play it right,' says the advisor, 'the results of this impending 
water crisis can be very good.'
www.zcommunications.org
Joyce Nelson is an award-winning freelance writer/researcher and the 
author of five books.
-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://lists.fahamu.org/pipermail/debate-list/attachments/20120613/cb7b7a29/attachment-0001.htm