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Mexico leads world in bottled water use

Poor quality tap water, soft drink tax are among reasons for high consumption

A deficient drinking water distribution system, taxes on sugared drinks, strong media campaigns for healthy lifestyles and a shortage of regulations made Mexicans the largest consumers of bottled drinking water in the world in 2014.

And the trend is only going to continue, according to analysts, who say Mexicans spent US $7.8 billion on bottled water in 2014, up 56% from the $5 billion spent in 2009. By 2019, the figure is forecast to be 15% higher, reaching $9.4 billion.

Two issues are seen as the chief drivers of the increase: a tax on sugared drinks of 1 peso per liter, imposed in January last year, and a loss of purchasing power after the 2014 fiscal reforms have encouraged consumers to turn to bottled water as an option.

“It is clear that people reduced their consumption of soft drinks because of the tax. There’s even a study by the University of Carolina that shows that soft drink sales have dropped 10%, while bottled water is on the rise,” said Alejandro Calvillo, director of El Poder del Consumidor, a consumer advocacy group.

“Historically, bottled water consumption in Mexico has been always high. We consider this is due to low consumer confidence in the quality of tap water, coupled with (water’s) scarcity in some regions,” said a spokesperson from Danone, an international food company.

According to business intelligence company Euromonitor International, the bottled water market in Mexico is controlled by three companies: Danone’s Bonafont brand represents 47%, Coca Cola’s Ciel 19.4% and Pepsico’s Epura 7.1%.

Gian Carlo Delgado says it all began with an earthquake. The economist at the Sciences and Humanities Interdisciplinary Research Center of the National Autonomous University (UNAM) traces the high consumption of bottled water to the aftermath of the 1985 earthquake, which severely damaged water distribution systems.

“People are also wary of public water services, of the infrastructure, as the hydraulic sector is severely underfunded . . . . Current distribution systems are irregular and the liquid’s quality isn’t the best,” said Delgado.

For Mariana Vargas of the consumer research firm Kantar Worldpanel Mexico (KWP) a worldwide trend in the consumption of healthier products has had a direct impact on bottled water use.

“In Mexico, bottled water sales have been increasing constantly for years, and that trend has only become stronger since 2010, even after taking into consideration the upturn after the tax increase (on soft drinks) last year,” she explained.

The popular option for Mexican households is to buy 20-liter “garrafones” as the price per liter is about 0.82 pesos, while smaller presentations go from 7.9 to 10.2 pesos per liter.

According to KWP data, a Mexican household uses on average 87 garrafones per year, 56% of which are bought from independent water purifying companies.

Tourist advisories that warn about the quality of tap water and suggest buying it in sealed bottles have an impact on domestic consumption as they promote the idea that tap water isn’t safe.

“I still drink tap water as it has never made me sick,” says Brenda Rodríguez of the Water Rights Coalition of Mexican Organizations. “But when a Swiss colleague visits I’m the first to warn her not to drink it. Standards in Mexico are completely different from those in Switzerland or Spain. I think people don’t drink tap water because there’s no certainty (of its quality).

“It is sad that the government can’t guarantee the quality of the water you are paying for and receiving in your home. Public policies are handicapped when tasked with monitoring and guaranteeing that the water that you receive at home, at school or at your job is truly safe to drink,” Rodríguez said.

Source: El Universal (sp)

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