from the booklet

Blue Gold

The global water crisis and the commodification of the world's water supply

A Special Report issued by the International Forum on Globalization (IFG)

by Maude Barlow
National Chairperson, Council of Canadians
Chair, International Forum on Globalization (IFG) Committee
on the Globalization of Water


Watersheds come in families' nested levels of intimacy. On the grandest scale the hydrologic web is like all humanity-Serbs, Russians, Koryukon lndians, Amish, the billion lives in the People's Republic of China-it's broadly troubled, but its hard to know how to help. As you work upstream toward home, you're more closely related. The big river is like your nation, a little out of hand. The lake is your cousin. The creek is your sister. The pond is her child. And, for better or worse, in sickness and in health, you're married to your sink.

-Michael Parfit, National Geographic

Presently, the world is poised to make crucial, perhaps irrevocable decisions about water. Except for those now deliberately seeking to profit from the world's water crisis and those who have continued to pollute water systems even when confronted with evidence of the damage they have wrought, the harm done to water to date has been largely unintentional and reactive-a combination of benign neglect, ignorance, greed, too many demands on a limited resource, careless pollution and reckless diversion. The human race has taken water for granted and massively misjudged the capacity of the earth's water systems to recover from our carelessness. Although we now must answer for the great harm we have caused, it is probably fair to say that no one set out to create a global water shortage or to deliberately destroy the world's water supply.

However, lack of malice is no longer a good enough excuse. We know too much. Forces are already established that would see water become a private commodity to be sold and traded on the open market, controlled by transnational corporations and guaranteed to serve investors and private sectors through global trade and investment agreements. If we do nothing now, this is the future of water.


In order to begin to develop a comprehensive sustainable water ethic, it is first necessary to acknowledge that there is a profound human inequity in the access to freshwater sources around the world. Those who are water-poor live almost exclusively in the non-industrial world; those who are water-rich live in industrial countries, where governments and corporations have become wealthy from the colonization and domination of the very areas now living in water-stress conditions. We have in this situation a tragic dilemma. It could be argued that the industrialized world has a moral obligation to share with water-poor areas, even though this would put great stress on already damaged ecosystems.

Those who view water as a commodity say that water flowing into the sea or situated in what one forest company CEO calls "decadent wilderness" is not of service to people or the economy and is, therefore, a wasted commodity. However, environmentalists warn that this is a simplistic analysis. For one thing, water situated in lakes is not available for export or diversion unless we choose to dry up those lakes. Only water that runs off from rivers to the sea or is mined from aquifers is actually available freshwater. Although Canada holds almost one-quarter of the world's freshwater, for instance, most of it is in lakes or river systems flowing north. To move large volumes of this water would massively tamper with the country's natural ecosystems.

Scientists warn that removing vast amounts of water from watersheds has the potential to destroy entire ecosystems. Lowering water tables can create sinkholes and dry up wells. Huge energy costs would be associated with large-scale water movement; one version of the GRAND Canal scheme called for a series of nuclear power stations along the route to supply the energy needed for the movement of such huge volumes of water. Existing water diversions and hydroelectric projects are causing local climate change, reduced biodiversity, mercury poisoning, loss of forest, and the destruction of fisheries habitat and wetlands. Imagine what damage a mega-project such as the GRAND Canal might cause.

Scientific studies show that large-scale water removal affects not just the immediate systems, but ecosystems far beyond. "This work proves beyond all doubt that water is not 'wasted' by running into the sea. It suggests that the cumulative effects of removing water from lakes, rivers and streams for export by tanker could have large-scale impacts on the coastal and marine environment," says Canadian water expert Jamie Linton.

Richard Bocking says we strike a Faustian bargain when diverting rivers. "For power generation or irrigation today, we exchange much of the life of a river, its valley and biological systems, and the way of life of people who are in the way. As the cost of the last 50 years of dam building becomes evident, we can no longer plead that we don't know the consequences of treating rivers and lakes as plumbing systems."

However, what of the humanitarian argument that in a world of water inequality, water-rich areas have an obligation to share water supplies with others? Perhaps here it would be helpful to distinguish between short-term and long-term approaches. Importing water is not a desirable long-term solution for either the ecosystems or the peoples of water-scarce regions of the world. Water is such an essential necessity of life, no one should become dependent on foreign supplies that could be cut for political or environmental reasons.

It is also helpful to distinguish between water trading and water sharing. In a commercially traded water exchange, those who really need the water would be the least likely to receive it. Water hauled long distances by tankers would only be available to the wealthy, especially large corporations. Importing water for only those who could afford it would reduce the urgency and political pressure to find real, sustainable and equitable solutions to water problems throughout the world.

George Wurmitzer, the mayor of Simitz, a small town in the Austrian Alps, essentially captures the difference between water sharing and water trading when he expresses concerns about large-scale exports of water from his community "From my point of view, it is a sacred duty to help someone who is suffering from thirst. However, it is a sin to transfer water just so that people can flush their toilets and wash their cars in dry makes no sense and is ecological and economic madness."

As Linton says, "Perhaps the strongest argument against [commercial] water export is that it would only perpetuate the basic problem that has caused the 'water crisis' in the first place- the presumption that peoples' growing demands for water can and should always be met by furnishing an increase in the supply. This thinking has led to the draining of lakes, the depletion of aquifers and destruction of aquatic ecosystems around the world."

If, however, we maintain public control of water, it might be possible to share water supplies on a short-term basis between countries in times of crisis. In these cases, water sharing would need to be accompanied by strict timetables and conditions aimed at making the receiving region water-independent as soon as possible. This way, water could be used to encourage water system restoration. This kind of resolution is not conceivable, however, if the privatization of the world's water continues unchallenged; corporations would not allow a non-profit system of water transfer to be established.


Similarly, the call to place a true economic value on water-increasingly made by environmentalists who rightly point out that in many water-rich countries, water is taken for granted and badly wasted-must be put in a political context. The argument is, if an accurate economic value were to be put on water, people would be more likely to conserve it. But in the current climate, there are serious concerns that need to be raised about the issue of water pricing.

First, water pricing exacerbates the existing global inequality of access to water. As we know, the countries that are suffering severe water shortages are home to the poorest people on earth. To charge them for already scarce supplies is to guarantee growing water disparities.

The issue of water pricing will therefore exacerbate the North/South divide. There is a sub-text to much of the handwringing over the world's water shortage. Almost every article on the subject starts with the reminder of the population explosion and where is it occurring. The sub-text is that "these people" are responsible for the looming water crisis. But a mere 12 percent of the world's population uses 85 percent of its water, and the 12 percent don't live in the Third World.

The privatization of this scarce resource will lead to a two-tiered world-those who can afford water and those who cannot. It will force millions to choose between necessities such as water and health care. In England, high water rates forced people to choose whether or not to wash their food, flush their toilets or bathe.

Second, under the current trade agreements, priced water becomes a private commodity. Only if water is maintained as a public service, delivered and protected by governments, can it be exempted from the onerous enforcement measurements of these free trade deals. The results of the trade agreements are very clear. If water is privatized and put on the open market for sale, it will go to those who can afford it, not to those who need it. Once the tap has been turned on, by the terms of trade rules it cannot be turned off.

The World Bank says that it will subsidize water for the poor. Anyone familiar with the problems of welfare, particularly in the Third World, knows that such charity is punitive at best, and more often nonexistent. Water as a fundamental human right is guaranteed in the UN International Covenant on Human Rights. Water welfare is not what the architects of that great declaration had in mind.

Third, as it is now envisaged, water pricing will not have much of an impact. It is generally accepted that water consumption in urban centers breaks down at 70 percent industrial, 20 percent institutional and 6-10 percent domestic. Yet most of the discussions about water pricing center on individual water use. Large corporate users notoriously evade paying the cost of their water altogether.

Finally, in an open bidding system for water, who will buy it for the environment and the future? In all of this privatization/pricing debate, there is precious little said about the natural world and other species. That is because the environment is not factored into the commercial equation. If we lose public control of our water systems, there will be no one left with the ability to claim this life-giving source for the earth.

Yet the need to stop wasting water is urgent. The dialogue about water pricing is a crucial one; however, it must take place within a larger framework. To be both effective and just, any serious consideration of water pricing must take into account three factors the global poverty gap, water as a human right and water in nature.

To deal with the first, the global poverty gap, there are several immediate actions governments could take. These include cancelling the Third World debt, increasing foreign aid budgets to their previous standards (.7 percent of GDP), and implementing a "Tobin tax" ( a small, worldwide tariff) on financial speculation that would pay for water infrastructure and universal water services.

To deal with the issue of water as a human right, countries must adopt constitutions such as that of South Africa, which guarantees water first for people, second for nature and third for the economy. Every South African is guaranteed enough free water for basic needs; only then is there consideration of pricing.

To ensure that ecosystem survival is key to any new system that might include pricing, revenues raised must be used to protect the environment, restore watersheds, enforce clean water standards and repair faulty infrastructure, which is currently the cause of great water wastage.

Further, the focus must be on the greatest abusers of water-large industry and corporate farming. Governments must bring the rule of law to those corporations that pollute and waste precious water. They must also implement a more just taxation system that captures some of the untold billions in taxation that large corporations now evade. These revenues would go a long way toward cleaning up the earth's dying water systems. Clearly, the focus must be on those who use water most and who then remove the benefits of using this common good, this public trust, from the community for the sake of profits, particularly in an age of mergers and transnational corporations. Business has no right to deprive anyone of their inalienable human rights; if that is the price of profit, the price is too high.

None of these conditions, however, is possible if water is not controlled in the public interest. If water is allowed to be commercialized and controlled by corporations, the profit principle will dominate. In this case, water-pricing would become a tool of the market, rather than be a tool that could be used as an incentive to conservation and to ensure that water remains a fundamental human right for every person on earth.


In order to take the kind of action needed by all levels of government and communities around the world, it is urgent that we come to agreement on a set of guiding principles and values. The following is offered as an opening dialogue

I) Water belongs to the earth and all species. Water, like air, is necessary for all life. Without water, humans and other beings would die and the earth's systems would shut down. Modern society has lost its reverence for water's sacred place in the cycle of life as well as its centrality to the realm of the spirit. This loss of reverence for water has allowed humans to abuse it. Only by redefining our relationship to water and recognizing its essential and sacred place in nature can we begin to right the wrongs we have done.

Because water belongs to the earth and all species, decision-makers must represent the rights and needs of other species in their policy choices and actions. Future generations also constitute "stakeholder" status requiring representation in decision-making about water. Nature, not man, is at the center of the universe. For all our brilliance and accomplishment, we are a species of animal who needs water for the same reasons as other species. Unlike other species, however, only humans have the power to destroy ecosystems upon which all depend and so humans have an urgent need to redefine our relationship to the natural world. No decisions about water use should ever be made without a full consideration of impacts to the ecosystem.

2) Water should be left where it is whenever possible. Nature put water where it belongs. Tampering with nature by removing vast amounts of water from watersheds has the potential to destroy ecosystems. Large-scale water removal and diversion affects not just the immediate systems, but ecosystems far beyond. Water is not "wasted" by running into the sea. The cumulative effects of removing water from lakes, rivers and streams has disastrous large-scale impacts on the coastal and marine environment as well as on the indigenous peoples of the region, and other people whose livelihoods depend upon these areas.

While there may be an obligation to share water in times of crisis, just as with food, it is not a desirable long-term solution for either the ecosystems or the peoples of any region of the world to become dependent on foreign supplies for this life-giving source. By importing this basic need, a relationship of dependency would be established that is ultimately harmful. By accepting this principle, we learn the nature of water's limits and to live within them, and we start to look at our own regions, communities and homes for ways to meet our needs while respecting water's place in nature.

3) Water must be conserved for all time. Each generation must ensure that the abundance and quality of water is not diminished as a result of its activities. The only way to solve the problem of global water scarcity is to radically change our habits, particularly when it comes to water conservation. People living in the wealthy countries of the world must change their patterns of water consumption, especially those in water-rich bioregions. If they don't change these habits, any reluctance to share their water-even for sound environmental and ethical reasons-will rightly be called into question.

The key to maintaining sustainable groundwater supplies is to ensure that net extractions do not exceed recharge. Some water destined for cities and agribusiness will have to be restored to nature. Large tracts of aquatic systems must be set aside for preservation; governments must agree on a global target. Planned major dams must be put on hold and some current river diversions must be re-oriented to reflect a more natural seasonal flow or else be de-commissioned altogether.

Infrastructure improvement must become a priority of governments everywhere to stem the huge loss of water through aging and broken systems. Government subsidies of wasteful corporate practices must end. By refusing to subsidize abusive water use, governments will send out the message that water is not abundant and cannot be wasted.

4) Polluted water must be reclaimed. The human race has collectively polluted the world's water supply and must collectively take responsibility for reclaiming it. Water scarcity and pollution are caused by economic values that encourage overconsumption and grossly inefficient use of water. These values are wrong. A resolution to reclaim polluted water is an act of self-preservation. Our survival, and the survival of all species, depends on restoring naturally functioning ecosystems.

Governments at all levels and communities in every country must reclaim polluted water systems and halt, to the extent possible, the destruction of wetlands and water systems habitat. Rigorous law and enforcement must address the issue of water pollution from agriculture, municipal discharge and industrial contaminants, the leading causes of water degradation. Government must re-establish control over transnational mining and forestry companies whose unchecked practices continue to cause untold damage to water systems.

The water crisis cannot be viewed in isolation from other major environmental issues such as clear cutting of forests and human-induced climate change. The destruction of waterways due to clear cutting severely harms fish habitat. Climate change will cause extreme conditions. Floods will be higher, storms will be more severe, droughts will be more persistent. The demand on existing freshwater supplies will be magnified. To reclaim damaged water will require an international commitment to dramatically reduce human impacts on climate.

5) Water is best protected in natural watersheds. The future of a water-secure world is based on the need to live within naturally formed "bioregions," or watersheds. Bioregionalism is the practice of living within the constraints of a natural ecosystem. The surface and groundwater conditions peculiar to a watershed constitute a set of essential parameters that govern virtually all life in a region; other characteristics, such as flora and fauna, are related to the area's hydrological conditions. Therefore, if living within the ecological constraints of a region is key to developing a sustainable society, watersheds are an excellent starting point for establishing bioregional practices.

An advantage of thinking in watershed terms is that water flow does not respect nation-state borders. Watershed management offers a more interdisciplinary approach to protecting water. Watershed management is a way to break the gridlock among international, national, local and tribal governments that has plagued water policy around the world for so long. Watersheds, not political or bureaucratic boundaries, will lead to more collaborative protection and decision-making.

6) Water is a public trust to be guarded at all levels of government. Because water, like air, belongs to the earth and all species, no one has the right to appropriate it or profit from it at someone else's expense. Water, then, is a public trust that must be protected at all levels of government and communities everywhere.

Therefore, water should not be privatized, commodified, traded or exported in bulk for commercial purpose. Governments all over the world must take immediate action to declare that the waters in their territories are a public good and enact strong regulatory structures to protect them. Water should immediately be exempted from all existing and future international and bilateral trade and investment agreements. Governments must ban the commercial trade in large-scale water projects.

While it is true that governments have failed badly in protecting their water heritage, it is only through democratically controlled institutions that this situation can be rectified. If water becomes clearly established as a commodity to be controlled by the private sector, decisions about water will be made solely on a for-profit basis.

Each level of government must protect its water trust municipalities should stop raiding the water systems of rural communities. Watershed cooperation will protect larger river and lake systems. National and international legislation will bring the rule of law to transnational corporations and end abusive corporate practices. Governments will tax the private sector adequately to pay for infrastructure repair. All levels of governments will work together to set targets for global aquatic wilderness preserves.

7) An adequate supply of clean water is a basic human right. Every person in the world has a right to clean water and healthy sanitation systems no matter where they live. This right is best ensured by keeping water and sewage services in the public sector, regulating the protection of water supplies and promoting the efficient use of water. Adequate supplies of clean water for people in water-scarce regions can only be ensured by promoting conservation and protection of local water resources.

First Nations Peoples have special inherent rights to their traditional territories, including water. These rights stem from their use and possession of the land and water in their territories and their ancient social and legal systems. The inalienable right of self-determination of indigenous peoples must be recognized and codified by all governments; water sovereignty is elemental in the protection of these rights.

Governments everywhere must implement a "local sources first" policy to protect the basic rights of their citizens to freshwater. Legislation that requires all countries, communities and bioregions to protect local sources of water and seek alternative local sources before looking to other areas will go a long way to halt the environmentally destructive practice of moving water from one watershed basin to another. "Local sources first" must be accompanied by a principle of "local people and farmers first." Local citizens and communities have first rights to local water. Agribusiness and industry, particularly large transnational corporations, must fit into a "local-first" policy or be shut down.

This does not mean that water should be "free" or that everyone can help themselves. However, a policy of water pricing that respects this principle would help conserve water and preserve the rights of all to have access to it. Water pricing and "green taxes" (which raise government revenues while discouraging pollution and resource consumption) should place a heavier burden on agribusiness and industry than on citizens; funds collected from these sources should be used to provide basic water for all.

8) The best advocates for water are local communities and citizens. Local stewardship, not private business, expensive technology or even government, is the best protector of water security. Only local citizens can understand the overall cumulative effect of privatization, pollution and water removal and diversion on the local community. Only local citizens know the effect of job loss or loss of local farms when water sources are taken over by big business or diverted to faraway uses. It must be understood that local citizens and communities are the front-line "keepers" of the rivers, lakes and underground water systems upon which their lives and livelihoods rest.

In order to be affordable, sustainable and equitable, the solutions to water stress and water scarcity must be locally inspired and community-based. Reclamation projects that work are often inspired by environmental organizations and involve all levels of government and sometimes private donations. But if they are not guided by the common sense and lived experience of the local community, they will not be sustained.

In water-scarce regions, traditional local indigenous technologies, such as local water sharing and rain catchment systems that had been abandoned for new technology, are being revisited with some urgency. In some areas, local people have assumed complete responsibility for water distribution facilities and established funds to which water users must contribute. The funds are used to provide water to all in the community.

9) The public must participate as an equal partner with government to protect water. A fundamental principle for a water-secure future is that the public must be consulted and engaged as an equal partner with governments in establishing water policy. For too long, governments and international economic institutions such as the World Bank, the OECD and trade bureaucrats have been driven by corporate interests. Even in the rare instances that they are given a seat at the table, non-governmental organizations (NGOs) and environmental groups are typically ignored. Corporations who heavily fund political campaigns are often given sweetheart contracts for water resources. Sometimes, corporate lobby groups actually draft the wording of agreements and treaties that governments then adopt. This practice has created a crisis of legitimacy for governments everywhere.

Processes must be created whereby citizens, workers and environmental representatives are treated as equal partners in the determination of water policy and recognized as the true inheritors and guardians of the above principles.

10) Economic globalization policies are not water-sustainable. Economic globalization's values of unlimited growth and increased global trade are totally incompatible with the search for solutions to water scarcity. Designed to reward the strongest and most ruthless, economic globalization locks out the forces of local democracy so desperately needed for a water-secure future. If we accept the principle that to protect water we must attempt to live within our watersheds, the practice of viewing the world as one seamless consumer market must be abandoned.

Economic globalization undermines local communities by allowing for easy mobility of capital and the theft of local resources. Liberalized trade and investment enables some countries to live beyond their ecological and water resource means; others abuse their limited water sources to grow crops for export. In wealthy countries, cities and industries are mushrooming on deserts. A water-sustainable society would denounce these practices.

Global sustainability can only be reached if we seek greater regional self-sufficiency, not less. Building our economies on local watershed systems is the only way to integrate sound environmental policies with peoples' productive capacities and to protect our water at the same time.

Blue Gold

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