Image Courtesy of BBC Mundo
By Catalina Fazio Belán
Environmental regulations have been at the heart of Chilean politics for the past decade as pollution worsens and the country faces its thirteenth consecutive year of drought in its Central and Northern zones. After a referendum last October on rewriting the constitution, the issue of water scarcity became even more contentious as the 1980 constitution – written under the military dictatorship of Augusto Pinochet – emphasised neoliberal values which included widespread privatisation. With a new constitution on the horizon, private industries and environmental protection groups are clashing over water rights in a race to defend whichever regulations support their side of the argument. Consequently, this article will start by introducing Chilean neoliberalism with a focus on what was established in the 1980 constitution and the 1981 Water Code (Código de Aguas), followed by a case study and a look into how the possibility of a new constitution could solve some central issues relating to water scarcity. It will be concluded that the current constitutional process must keep environmental protection at its core if it intends to effectively tackle the issue, not only of water, but of pollution as a whole.
Neoliberalism can be defined as a policy model that promotes a reduction of governmental and state interference in the economy through privatisation, thereby emphasising rugged individualism. It is based on free market ideals which seek to lower trade barriers, deregulate markets, and eliminate price controls. It was first introduced in Chile by the so-called ‘Chicago Boys’, a group of Chilean students who had pursued a postgraduate degree in economics at the University of Chicago and who had been taught by Milton Friedman, one of the key thinkers of contemporary neoliberalism. The model was implemented during Pinochet's military dictatorship (1973-1990), when neoliberal state reforms were implemented in the hopes of alleviating the recession and economic crisis that had been inherited from the preceding Communist administration of former President Salvador Allende. The constitution was re-written to safeguard neoliberal values, which had an impact on several aspects of the document. The only attempt at environmental protection, set in Article 19, failed to separate itself from the neoliberal mindset of its time, instead prioritising privatisation and competition rather than environmental regulations.
Water has been one of the central topics of discussion in Chile for over a decade as the country’s drought worsens year after year and, more recently, due to its central role in the current process of re-writing the constitution. The neoliberal water reform was introduced in 1981 to the Código de Aguas and intended to increase efficiency, strengthen property rights, reinforce the autonomy of the private sector, and, overall, favour free markets over government involvement in the administration of the country’s water. In the name of increased efficiency, the philosophical principle of the Water Code resided on the concept of “freedom of entrepreneurship” which has two consequences: firstly, it ties the Code directly to a neoliberal agenda as competition becomes a central aspect of water rights. Secondly, “freedom of entrepreneurship” was acted upon by having private companies acquire water rights free of charge which are currently being rebated and resold as prices soar due to the ongoing drought. Throughout this process, the government is entirely powerless as the titles are a property right guaranteed by the Civil Code. Even though water is recognised as a public good, it is established in the constitution as a private right.
This becomes a severe issue as water is misused and exploited by big companies and industries. Between 1981 and 2004, 100 million litres per second of water use rights were given out, but between 2005 and 2014 the number of given rights increased to 274 million. This demonstrates the neoliberal legacy of the dictatorship. Furthermore, water exploitation from the mining sector has risen steeply in the past decade, even though the country’s total resources are declining due to both a lack of environmental protection and to climate change. An example of this can be found in the lithium industry of the Atacama Desert. Chile has the largest lithium reserves worldwide and is the second biggest exporter of the resource. The mineral extraction process is heavily dependent on water evaporation and, even though industries argue that the salt water used in the production does not have an impact on the water used for consumption, locals claim it has affected microorganisms and has unbalanced the region’s ecosystem to a point where individuals’ lives are at risk. This is only one of many examples of grave water issues found across Chilean territory.
In a country moved largely by a neoliberal agenda and by the privatisation of public rights, it is hard to force change to happen. On the one hand, there have been attempts to reform the Water Code. Current proposals seek to prioritise water access for human consumption and for the protection of the environment, rather than maintaining it as a tool for private companies to exploit. Furthermore, water rights and titles could still be acquired and sold but would have an expiration date of either twenty or thirty years, depending on the use the title is given. Nevertheless, it is unlikely the reform will be implemented soon as nine years have passed since its proposal and it is still being processed in the Senate.
The second way of approaching the issue is through a change in the constitution – a process which is already underway and will take up the next two years. One of the most relevant parts of the process is the election of constituents responsible for writing the new constitution; each party or independent candidate will seek to push their agenda forward in the document, but few candidates hold environmental protection as a focal point. Among the many suggestions is the inclusion of the environment in one of the first articles of the new constitution. The first articles tend to be the most relevant, and the ones other articles are derived from. Thus, environmental protection would be established as a transversal right in the constitution in such a way that it would be present in all aspects of the country’s future development. The current challenge is to elect constituents that will have this issue as their priority, rather than advancing a new free market agenda that would deteriorate the environment even further.
Chile is a country rich in natural resources, but the latter’s value has been undermined by severe exploitation as the interests of private companies are prioritised, partly due to the neoliberal influence introduced by the Pinochet regime. In a world based on economic advances, globalisation, and the significant export dependence of developing countries, environmental protection tends to be neglected until the damage becomes irreversible. Change is needed, and the rewriting of the constitution presents itself as the perfect opportunity for this. It is the responsibility both of citizens and of constituents to choose what is best, not only for the country and for themselves, but for the future as well.
Catalina Fazio Belán is a Chilean first-year International Relations BA student at King's College London. She is passionate about Latin American politics and current affairs.
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