Coyotes, concessions and construction companies: Illegal water markets and legally constructed water scarcity in Central Mexico

Abstract

Many regions of (semi)arid Mexico, such as the Valley of Toluca, face challenges due to rapid growth and the simultaneous overexploitation of groundwater. The water reform of the 1990s introduced individual water rights concessions granted through the National Water Commission (Comisión Nacional del Agua, or CONAGUA). Since then, acquiring new water rights in officially 'water-scarce' aquifers is only possible through official rights transmissions from users ceding their rights. With the law prohibiting the sale of water rights, a profitable illegal market for these rights has emerged. The key actor in the water rights allocation network is the coyote, functioning as a broker between a) people wanting to cede water rights and those needing them, and b) the formal and informal spheres of water rights allocation. Actors benefitting from water rights trading include the coyote and his 'working brigades', water users selling surplus rights, and (senior and lower-level) staff in the water bureaucracy. The paper concludes that legally constructed water scarcity is key to the reproduction of illegal water rights trading. This has important implications regarding the current push for expanding regularisation of groundwater extraction in Mexico. Currently, regularisation does not counter overexploitation, while possibly leading to a de facto privatisation of groundwater.