Water theft and water smuggling

Fresh water is vital for human survival and health, the production of food and energy, industrial activity, and the functioning of the entire global economy, as well as for the survival of other animals, plants, and natural ecosystems. Water scarcity, whatever its cause—natural catastrophes, pollution, poor water management, or theft—can have grave consequences. In this paper, Vanda Felbab-Brown examines the highly controversial and emerging topics of water theft and smuggling, and the policy failures that give rise to problematic illegal water markets around the world.

The controversy about water (theft)

The topic is highly controversial because there is no common definition as to what constitutes water theft and smuggling, or, for that matter, whether such phenomena exist at all. Increasingly, newspaper articles around the world, particularly in countries experiencing intense drought and water shortages, are highlighting water theft as a growing problem. Yet water experts, water-focused nongovernmental organizations (NGOs), governments, and communities do not agree whether there is any such a thing as water theft.

[W]ater experts, water-focused nongovernmental organizations (NGOs), governments, and communities do not agree whether there is any such a thing as water theft.

There are two broad schools of thought about the use of and access to water. One school defines water as a basic human right, and often opposes the pricing of water, particularly increases in prices. Another school of thought sees water as a commodity to which value needs to be assigned,¹ contending that, like electricity, it needs to be priced properly to maintain its sustainability and efficient use. According to this premise, the concept of water theft is valid—theft being the appropriation of water without the required payment, or in violation of existing rules. The first school of thought, however, is deeply uncomfortable with the concepts and language of water theft and smuggling. While this school does see the unauthorized taking of water from a neighbor’s tank as theft, it questions whether the unauthorized taking of water from a public source or the commons, such as river, can be called “theft,” particularly if such behavior is driven by need. Rather, punitive enforcement of regulations against unauthorized use of water from common or public sources can constitute the denial of a human right. Thus, legislation and regulations concerning water use can be politically divisive and explosive, since these opposite views can be strongly held even within the same polity.

In-between positions do exist. Some water experts, for example, grant that access to water is a basic human right that should not be withheld from anyone. But they also maintain that having water brought from its source, treated for human consumption, and delivered to one’s home is not a basic human right, and hence that it is appropriate to pay for the treatment and delivery of water. Accordingly, they argue that the unpaid taking of water is not theft, although it is an illegal use of utility facilities.² Other expert reports on water management are consistent with the notion that “free water is wasted water,” and yet refrain from using terms such as water theft and instead use the milder wording of an overuse of water.³

Of course, in some jurisdictions, overuse can be perfectly legal, not involving any violation of law, while also being unsustainably inefficient and causing environmental degradation. In the Arab world, for example, water prices are kept artificially low and water is heavily subsidized—with the price of desalinated water being a mere 10 percent of the cost of production—which is a highly inefficient and problematic approach, but perfectly legal. Chinese industry uses 10 times more water per unit of production compared to the average in rich countries.⁴ In parched California, inadequate pricing of water results in the continued cultivation of water-intensive crops, such as avocados, once again highlighting that inefficiency can be perfectly legal.

In this paper, Felbab-Brown’s analysis operates essentially within the framework of the school which holds that water theft is possible. Yes, access to water is a human right but that does not mean that it is a limitless right and that access to water should be uncontrolled and free. Just as access to food for survival is a human right, food is priced. If some population cannot afford to buy the food necessary for survival, they are appropriately entitled to food assistance. Similarly, water should be priced, and only access to a certain amount of water—the amount necessary for an individual’s healthy existence—should be supported with assistance to fulfill this human right. Access to water beyond the necessary minimum, such as for swimming pools, lawns, agriculture, or industrial purposes, should be appropriately priced and not defined as a basic human right. Moreover, even access to the minimum amount of water necessary for healthy human survival can and should entail restrictions on how individuals access the water. Violations of existing regulations and water allocations or accessing water through means that jeopardize water quality should not be allowed under the premise of exercising a basic human right. Clearly, stealing water from a neighbor’s household would be viewed by most as theft. Unauthorized taking of water from wetlands or rivers, for example, or by drilling unauthorized connections to water pipes, should also be viewed as theft.

Felbab-Brown thus defines water theft as any taking of water in violation of existing regulations. Such violations can include not paying the amount specified by local water regulations, such as by tampering with meters, tapping boreholes without necessary licenses, or installing unauthorized connections to water distribution systems. She defines water smuggling as any transportation and distribution of water in violation of existing regulations. Thus, it is warranted to brand as criminal water enterprises those entities who commercially appropriate and distribute water in violation of existing regulations, such as by taking it from a river without permission—by law or by a specific license—from a water authority. The private distribution of water by itself does not constitute a violation of law, and indeed, private water markets may be necessary to ensure access to water by poor and marginalized populations. However, if the private water distributors fail to pay taxes on their water income, they are then at minimum informal water distributors. If they acquire the water they sell in violation of regulations, they should be treated as illegal water distributors. (Of course, a private distributor can have a license from the government to operate and pay taxes, yet still steal water from public resources, such as hydrants or rivers, in violation of existing laws).

The specifications in existing water laws—such as whether it is legal or not to take water from a public hydrant, whether it is necessary to disclose such acquisition of water and pay for it, whether it is legal to siphon water off from a river on public lands—vary widely among countries and even within countries. Thus, what is water theft in one jurisdiction may be perfectly legal in another, even a neighboring one. In some places but not others, for example, groundwater (the technical term for water that is underground) is considered a common resource from which all farmers can withdraw—sometimes very cheaply, or even for free. Although such a lack of pricing may have devastating environmental and water sustainability effects, it can be perfectly legal.

This paper is also controversial because Felbab-Brown proposes that water regulations should be seriously enforced, including through punitive means. The policing of water needs to become a part of the menu of tools that communities and policymakers have to ensure an adequate, equitable, and sustainable use of water for people, agriculture, industries, and natural ecosystems. Some water regulators and NGOs believe that adversarial approaches to water management, which policing, enforcement, and punitive approaches to water violations entail, are counterproductive and that the best water management emerges from nonconfrontational cooperation among a broad set of stakeholders. They question whether unauthorized water use should be called illegal and suggest that such an explosive label will prevent achieving buy-in from the relevant stakeholders. This lack of common language and conceptualization makes effective and sustainable water management all the more difficult. While not claiming to resolve these debates, Felbab-Brown offers recommendations for how to incorporate enforcement approaches to water management in situations where they may be appropriate, underlining that such situations currently exist and will become more frequent.

Although the paper is not globally exhaustive, Felbab-Brown provides examples of (possible) water theft and smuggling from Asia, Africa, and Latin America, as well as Western Europe. She also provides contrasting comparisons from the United States and unpacks the controversies as to whether what is oftentimes labeled as water theft in U.S. newspapers in fact legally constitutes an offense. Accordingly, she explores informal and illegal water markets in both urban and rural areas. Felbab-Brown reviews the types of water theft and smuggling that have emerged, their scale and frequency, the threats they pose, and the benefits they sometimes bring to marginalized populations, not just to privileged and unaccountable actors. She further analyzes the governance of illegal water markets and the structure of water smuggling groups and their political power and capital. In doing so, she provides analysis of the role of government water authorities in the perpetuation of illegal water markets, and the frequent government collusion in illegal water-related activities in various parts of the world, as well as the political constraints on rectifying the situation and adopting better policies. The concluding section features policy implications and recommendations.

Background on the state of water in the world

The global distribution of water does not conveniently match local supply with demand. China has less water than Canada, yet 40 times as many people. Moreover, vast portions of China’s surface water, such as of the Yellow River water system, have been destroyed by industrial and agricultural pollution as well as overuse. Thirteen Arab countries are among the world’s 19 most water-scarce nations. Eight of them are already experiencing severe water scarcity per capita, with precipitation across the Arab world expected to decline by 25 percent and evaporation to increase by 25 percent by the end of the 21st century.⁵ Recently, even water-rich countries such as Brazil, have grappled with droughts and water scarcity. Moreover, in both water-rich and water-poor countries, access to water is highly unequal in both rural and urban areas. The pricing of water also varies widely around the world. Denmark has the world’s most expensive drinking water and users shoulder the entire bill themselves. In contrast, among developed countries, Singapore has some of the world’s cheapest water relative to GDP per capita.⁶

In 2015, 650 million people worldwide lacked access to safe drinking water.⁷ Although a very large number, this constitutes a vast improvement over the past decade. In 2004, 1 billion people lacked access to safe drinking water and 2 billion lacked access to safe sanitation.⁸ In its Sustainable Development Goals (SDGs), the international community adopted very ambitious and multifaceted objectives regarding the expansion of access to water and sanitation by 2030. Specifically, SDG 6 called for universal and equitable access to safe and affordable drinking water for all; adequate and equitable sanitation and hygiene for all, and an end to open defecation; improving water quality, reducing pollution, eliminating dumping, and minimizing the release of hazardous chemicals and materials; increasing water-use efficiency, ensuring water sustainability, and reducing the number of people who suffer from water scarcity; implementing integrated water resources management across all levels, including transboundary; and by 2020, protecting and restoring water-related ecosystems.⁹

Nonetheless, despite the improvements and the ambitious conceptualization of the SDG on water, various countries in the world are becoming water-stressed as a result of global warming and desertification driven by other causes, such as deforestation, population growth, and poor water management.

Already, a quarter of Africa’s population is experiencing chronic water stress. By 2025, 3 billion people could live in water-stressed countries, including countries of high poverty and large population growth.¹⁰ As the world’s population quadrupled over the past 100 years, water consumption has increased sevenfold. Water scarcity is pervasive not only in sub-Saharan Africa and the Middle East, but also in South Asia, China, Australia, Mexico, and the western United States.

The United Nations and many experts set the minimum water requirement per person at 50 liters per day. The assumption is that a person drinks two to three liters, and the rest goes to cooking, washing, and sanitation, such as flushing toilets. In severely water stressed countries, people will often not be able to access this minimum amount. In the United States, on the other hand, the average water use per person is between 400 and 600 liters a day, more than any other country.¹¹ Much of the use by Americans is rather profligate, such as letting the water faucet run while they brush their teeth. Indeed, per capita water consumption in Europe is less than half of that in the U.S.

Agriculture uses 70 percent of the surface water, such as from rivers or lakes, and from groundwater that is consumed globally.¹² In combination with high-yield grains and fertilization, irrigating farmland can lift people out of poverty, but it can also massively deplete water resources.¹³ A frequently quoted statistic is that it takes 140 liters of water to make a cup of coffee, with the vast majority of the water being spent on growing the coffee plant.¹⁴ Although this number and the very concept of the so-called water footprint of agricultural crops has been criticized (both for underestimating and overestimating the water impact of agriculture and failing to distinguish between different sources of water, their quality, and thus their impact in growing countries),¹⁵ it nonetheless captures how much water agriculture can consume and the frequent invisibility of water in food production. If one accepts the concept of a water footprint, then a kilogram of wheat requires 1,300 liters of water to produce and 1 kilogram of beef 15,000 liters.¹⁶ In India, the proliferation of pumps, wells, and subsidized energy led to the proliferation of wells for agriculture and the depletion of surface and groundwater. While 40 years ago, there were 2 million wells, a decade ago there were 23 million wells, and that number has continued to expand.¹⁷ The depletion of water, coupled with intense urbanization and the growth of urban slums, has increased illegal water sourcing (water theft) and water smuggling.

In many parts of the world, intense competition over water resources is underway. This competition is likely to significantly intensify as a result of population growth, urbanization, increased living standards, overuse of water, environmental degradation, and climate change. As surface water is depleted or becomes polluted, groundwater is turned to as the next source. Groundwater can be managed well. In the 1990s, the state of Arizona established a “groundwater bank” as a protection against river water shortages. Since then, the state refills the groundwater basins with water from the Colorado River and stores the water for times of shortage. Arizona also allows California and Nevada to use the groundwater basin as a bank for storage. Nevada would take Arizona’s Colorado River water from Lake Mead and the Arizona groundwater bank would pump groundwater from adjacent basins into the Central Arizona Project aqueduct and deliver it to Arizona users. Similarly, cities buy Colorado River water and then either through injection or infiltration (the process by which surface water enters the soil system) replenish groundwater system. Nevada also has its own groundwater bank.

At times, groundwater use can be highly problematic. In both developed and developing countries, groundwater can become rapidly overused and depleted, facilitated by the widespread availability of cheap drills, pumps, and inexpensive energy supplies. In parts of India, northern China, Yemen, and Mexico, water tables have been falling significantly and water extraction from at least a quarter of aquifers exceeds sustainable levels.¹⁸

The purpose of water regulation is to ensure long-term water sustainability and compatibility of water use across society, by all actors, and among competing uses…

Indeed, the regulation of groundwater is even more complex and exhibits more frequent regulatory failure than the regulation of surface water. Since groundwater is less visible, and credible estimates of aquifer size, replenishment, and depletion are frequently lacking,¹⁹ problems of free-riding, buck-passing, overuse, and water theft and smuggling only increase in intensity.²⁰

Since use of groundwater is often financed privately, such as by farmers, businesses, and industries, rather than the government, it tends to be vastly underreported. And yet underground water resources are often connected in complex ways to surface water, such as in rivers. If one belongs to the school of thought that does not define limitless unpriced access to water as a human right, then water theft and smuggling can and do occur from both surface and underground water sources, often on a massive scale. Already, approximately one-fifth of the world’s aquifers are overexploited.²¹

The purpose of water regulation is to ensure long-term water sustainability and compatibility of water use across society, by all actors, and among competing uses, such as drinking, agriculture, industry, and energy, as well as to ensure the preservation or biodiversity of natural ecosystems. Strict legal compliance of course does not guarantee the sustainable and efficient use of water. If the regulatory system is inadequate, all kinds of deficiencies can pervade water use.²² Nor does strict legality of water distribution necessarily signify equitable access to water. Indeed, in many parts of the world, the poor and marginalized, particularly in urban spaces, can only access water through private or extralegal distribution systems. In developing countries, customary water use, such as for access to grazing, cultivation, and drinking, may be fully unauthorized and, in fact, illegal—even as it is vital to the survival of rural and pastoralist populations.

However, without legal compliance, it is difficult to devise an effective regulatory system since insufficient pricing and cost-avoidance can, and often do, lead to overuse and depletion and eventually result in the degradation of water treatment and supply facilities. All these problems compound the lack of water access for the poor and marginalized, ultimately drying up even their informal, and sometimes outright illegal, water sourcing and distribution. Assigning property rights and pricing water is insufficient if enforcement is absent or inadequate. Though cross-border water smuggling has so far not materialized on any large scale, it could become prevalent in the future, with all of its political, conflict, and geostrategic implications.