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Water scarcity, contamination could become wave of the future
By Joan Lowy
Scripps Howard News Service


March 21, 2005

As the planet prepares to mark the 13th annual World Water Day on Tuesday, water scarcity and contamination are becoming both an increasing economic threat to industry and a growing business opportunity, experts said.

More than 1 billion people worldwide don't have safe, reliable drinking water and 2.6 billion don't have access to adequate sanitation services. Between 2 million and 5 million people die each year from water-related diseases.

China, with a population of 1.3 billion, is facing severe water shortages as well as widespread water pollution. Seventy-seven percent of effluent is currently untreated, 70 percent of the Chinese population has no access to safe drinking water, and 400 of 600 cities face water shortages, according to a report released Monday by Helmut Kaiser Consultancy, an international environmental and technology consulting firm in Tuebingen, Germany. Contamination and lack of supply capacity are the leading factors for water shortage.

China's market for water and wastewater treatment will increase to $22.7 billion in 2005 from $18.7 billion in 2004 and is expected to reach $33.2 billion by 2010, the firm said.

French and British water companies have been moving aggressively to take advantage of the Chinese water-services market, while Swiss-based Nestle "is establishing its leading position in the highly competitive but also highly lucrative bottled water market in China," the consulting firm said.

A few global water companies have been rapidly taking over the operation of water delivery or sanitation services as communities in the United States and elsewhere search for ways to cut costs and meet increased demand. The result has been a backlash in some communities by consumer and labor groups.

"Water privatization has caused deterioration in services, higher prices for the poor, more corruption, environmental problems and more," Public Services International, a multi-national trade union, said in a statement Monday. "The list of problems is long and the consequences of privatization can be disastrous for communities and governments."

But some industries are also suffering from water-related problems that have resulted in plant closures, supply-chain disruptions and public opposition to local business activity.

Coca-Cola, for example, was forced to close a bottling plant in India last year and was under pressure to close another because of protests from villagers and farmers who said the plants were depleting groundwater.

A recent study by the nonpartisan Pacific Institute in Oakland, Calif., warned that businesses around the world, from beverage companies to microchip manufacturers, are failing to prepare for the serious risks posed by growing competition for fresh water, the threat of water contamination and rising water-related costs.

In a separate report, the United Nations' Environment Program and the Stockholm International Water Institute said, "The potential risks associated with water scarcity have become an emerging risk of strategic importance to businesses and their financial backers around the world."

Aid from industrial countries for water development has been cut almost in half since the 1980s, said Charles Riemenschneider, North American director of the United Nations' Food and Agriculture Organization.

There are signs, however, that Congress is taking a greater interest in global water problems, said Peter Gleick of the Pacific Institute.

Bipartisan legislation sponsored by Senate Republican leader Bill Frist of Tennessee and Senate Democratic leader Harry Reid of Nevada would direct the secretary of state to come up with the program to assist international efforts to address problems, Gleick said.

However, senators cut the $250 million a year that was to be authorized for the program in early drafts of the legislation, Gleick said.

"At worst it's a feel-good effort, but at best it really is a push to the U.S. government to pay more attention to these problems."


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E-mail Joan Lowy at LowyJ(at)

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