Red Hot Hydropolitics: Human And State Security Implications Of Water Scarcity In Chile

by JOSÉ PABLO ZAMBRANO RAMÍREZ

Submitted in total fulfilment of the requirements of the degree of Master of Arts April 2012 School of Social and Political Sciences The University of Melbourne

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Abstract

The relationship between environment and security is generally approached from either a state security framework, in so far environmental problems are a source of intra-state or inter-state violent conflict, or from a human security perspective, focusing on the impacts of these problems on people’s livelihoods. To date, that I am aware, there is no research that considers the effects of an environmental problem on these two dimensions of security simultaneously. This thesis bridges this gap by studying the security implications of water scarcity in Chile. It examines the two main drivers of water scarcity, droughts and socioeconomic development, to determine the exposure and vulnerability of Chile to this environmental problem. Based on the work of the Copenhagen School, it develops a framework that disaggregates and locates the impacts of droughts in analytical levels and security sectors. Additionally, it develops a typology of environment related problems as security issues, according to the sectors and analytical levels affected. Through the application of this framework and typology this research determines that in Chile water scarcity is a source of human insecurity, because it alters the livelihoods and the access to livelihood resources for a significant part of the population. It is also a source of strategic insecurity, as it jeopardizes the generation of energy, affecting the overall capabilities of the country, and thereby limiting the policy options of the authorities and the potential to give material responses to any given crisis. Finally, water scarcity is a source of strategic vulnerability, since a neighbouring country uses the subsequent energy insecurity as leverage in a long-lasting bilateral territorial dispute. This thesis uses the Regional Security Complex and the Hydropolitical Security Complex theories to assess the effects of water scarcity in the sub-system level. This research makes two relevant contributions to the security debate. First, an analytical framework that facilitates studying the security implications of droughts in any given nation-state. Second, it establishes a nexus between human and State security: if a non-traditional security problem, such as water scarcity, can become a source of State insecurity, then non-traditional security measures, originally aimed at improving human security, can be a source of State security. Although the context of this security analysis is Chile, a nation-state in which water is a relatively scarce resource and whose regional security complex is determined by patterns of enmity, two conditions that are not shared by every nation- state, the findings of this research are relevant nonetheless for the security debate, since it establishes that human and State security are not necessarily competing articulations, but two narratives with common fields in which they can strengthen each other.

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Acknowledgements

First and foremost, I want to thank my wife and family for their infinite love and support. My supervisor, David Mickler, for his guidance, assistance and patience; and Ralph Pettman, for simply being there. I would also like to thank Ernesto Brown and David Gutierrez for their hydrological assistance.

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Table of contents

Abstract 3

Acknowledgements 5

List of figures 9

List of tables 9

Introduction 11

Chapter 1: Research Framework 19 Methodology 19 Literature review 27 Analytical framework 45

Chapter 2: Internal Security Implications of Water Scarcity in Chile 59 Factors and conditions that determine the security vulnerabilities of Chile to the scarcity of water 60 Impacts of Drought in Chile by security sector 78 Strategic sector 85

Chapter 3: External Security Implications of Water Scarcity 97 South American regional security complex 98 Hydropolitics on a hot border 104 Energy (in)security 114

Chapter 4: Analysis 129 Security Implications of water scarcity in Chile 131 Non-traditional sources of traditional security 136 A securitization of water? 139

Conclusion 145

References 149

Appendix 167

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List of Figures

Figure 1: General map of Chile 17 Figure 2: Politico-Administrative division of Chile 61 Figure 3: Rainfall intensity and mean annual precipitation at different latitudes in Chile 67 Figure 4: Map of Lauca and Silala basins 106 Figure 5: Annual gas consumption in Chile 1965-2006 120 Figure 6: Installed capacity by energy source in SIC system 2009 134 Figure 7: Map of mean annual isohyets 168

List of Tables

Table 1: Aspects of a transboundary basin that enhance resilience or increase vulnerability 36 Table 2: Matrix of analysis of environment-related problems as security issues 52 Table 3: Drought Impacts 55 Table 4: Maximum rainfall intensity in different stations in Chile. 66 Table 5: Main basins of Chile 69 Table 6: Aspects of a transboundary basin that increase vulnerability 111 Table 7: Presidential Energy Input 124

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Introduction

On February 27, 2010, an earthquake of 8.8 degrees on the Richter scale, the sixth strongest on record, shook the central and southern regions of Chile, followed by a tsunami. As a consequence of these two consecutive events roads and bridges were cut, public infrastructure destroyed, seaside towns and coastal cities ravaged by the ocean, and houses and buildings were either ruined or left uninhabitable. In the most affected areas communication systems –phone, Internet and civilian radio networks– collapsed and basic services such as water, electricity and gas were not regularized until weeks later. In the following days fear of shortages of basic supplies and collective panic led to theft and looting. As a result, the government declared a State of Catastrophe, which allowed him to take armed forces out to the streets to restore order. 2010 also marks the beginning of a drought that affects the country since then. After years of constant declines in rainfall, with deficits that vary between fifteen percent and fifty percent, by 2012 more than a 100 municipalities have been declared water and agricultural emergency zones. In the arid regions in the north there are towns that have less than 23.9 litres1 of water a day per person2, which has made agriculture and cattle herding, the main sources of livelihood, impossible. Due to the lack of precipitations, and the subsequent flow reduction during thaw, the reservoir levels are at historical lows. In February 2011 the government established a Decree of Energy Rationing, by which it took control over the electric generation system and enacted measures to alleviate the crisis, such as reducing the voltage. However, by February 2012 the water available in the reservoirs throughout the country amounted only to 28.9% of the total capacity. If the conditions persist, according to the authorities there are enough reserves to secure consumption of potable water during 2012. However, power cuts have not been ruled out. Due to its exceptionally tangible and graphic consequences, extreme geological events, such as the Chilean mega-earthquake and its following tsunami, are one of the most straightforward ways to link the environment to the security of a country and its population. But such natural hazards constitute exceptional events. They have a clear cause, very low probability of occurrence and they usually happen unexpectedly. Their

1 The daily average water consumption per capita in a city of a developed country is above 80 litres. 2 Que pasa, 2011

11 consequences have high social, political and economic impacts, which generate states of disorder and confusion relatively short in time and geographically delimited. In contrast, most contemporary global environmental problems, such as climate change or the depletion of the ozone layer, are not the result of a single cause, but of a multiplicity of factors, related in complex, systemic, non-linear ways. Environmental problems are not restricted by any political or geographical border, and their effects differ according to the particular characteristics of each region. Their most dangerous threat is not a sudden disruption of the established order, but the accumulated effect of long-term problems, of varied nature and magnitude, that gradually lessen the livelihoods of people and progressively reduce the range of effective policy responses of the competent authorities. This thesis examines the relationship between environment and security, studying the security implications of water scarcity in Chile. It focuses on the impacts of droughts, a major driver of water scarcity, on the livelihoods of the population, on how they limit normal functioning of the country, and the geopolitical consequences that affect the regional security complex. The study of water-related problems is relevant for security studies, because water is probably the only natural resource present in all aspects of human life: from subsistence to spiritual practices or aesthetics, from agricultural production to energy generation. Consequently, food security, health security, economic security and energy security are all related to water. From a human security perspective, the study of water-related problems is important because water is essential for personal and social welfare, for economic development and for the sustainability of ecosystems. Correspondingly, from a state security perspective water has unique characteristics that transform it into a strategic natural resource: it has no substitute, knows no political boundaries and its distribution vary in space and time. The study of the security implications of water scarcity is timely, first, because it is expected that global climate change is going to make droughts more severe, recurrent and extended, both in duration and in the area affected. According to the latest Assessment Report (AR4) of the Intergovernmental Panel on Climate Change (IPCC), in recent decades around the globe there have been increases in average temperatures, longer and more intense droughts, as well as violent rains and floods. It is expected that these trends will prevail over the next thirty to fifty years. Secondly, one of the main drivers of water scarcity is socioeconomic development. As population

12 grows and the world economy expands, the relative availability of water decreases, as it is more demanded. This explains why current droughts are more harmful, despite being comparable in terms of precipitation deficit to similar events that occurred in previous decades. Given that development does not have the same pace in all countries, this also highlights the relevance of local conditions in determining the scope and scale of drought impacts. As framed by the International Strategy for Disaster Reduction (ISDR), “Drought by itself does not trigger an emergency. Whether it becomes an emergency or not depends on its effect on local people, communities and society, and this, in turn, depends on their vulnerability to the stress of the drought.”3 The two main drivers of water scarcity are the environmental/ecological conditions that determine its natural availability, and the social and economic demand for it. Chile has vulnerabilities in these two aspects. In regards of the former, nearly two thirds of the territory suffers a ‘nine-month drought’ every year, since precipitations are concentrated almost exclusively in one season. In these regions, where most of the population inhabits and most of the economic activity is concentrated, the average of water availability is less than 800 m³/person/year, which is less than half of what is considered necessary for sustainable development. Additionally, a recent report by the World Bank establishes that in the case of Chile the developmental strategy has been far more influential in the current situation of water resources than the dynamics of the water sector itself, as most of its exportation goods and products have water-intensive processes.4 In sum, water is already a scant resource in Chile and its future availability will be even more reduced, as it is limited by the biophysical conditions and the developmental paradigm, which entails a constant increase in the demand for water. The study of the security implications of the scarcity of water is timely and relevant, because water is a ubiquitous resource that performs irreplaceable biological functions and has an exceptional strategic value. As it will be proved in this thesis, in Chile the impacts of droughts have a human security dimension, since they alter the livelihood of the population and limit their access to livelihood resources, and they have State security dimension, as they limit the overall capabilities of the country to provision goods and services, together with affecting its regional security complex. There is abundant literature that approaches water scarcity from either of these security

3 ISDR, 2007:8 4 World Bank, 2011

13 dimensions but, as far as I am aware, there is no research that considers the implications on these two dimensions simultaneously. Because they are a problem of human security and of State security both dimensions could, and should, be addressed as integral parts of a complementary whole. This thesis seeks to bridge this gap, studying the case of Chile. It argues that water scarcity, a non-traditional environment- related problem, can impact the security of a nation-state in these two dimensions of security simultaneously. For this purpose, the analysis divides the study in internal security implications, which addresses the relationship between droughts and human security, and external security implications, which address the geopolitical consequences of water scarcity. The thesis is structured as follows: Chapter 1 presents the methodology to address the research topic and examines the relevant literature regarding climate change and the environmental security debate. It also explains the analytical framework developed in this research, which facilitates tackling the human and state security dimensions of water scarcity simultaneously, and presents a matrix developed to classify environment-related problems as security issues, according to the analytical levels and the security sectors affected. Chapter 2 examines the exposure of Chile to droughts, unpacking the biophysical conditions, the socioeconomic structure and the interplay between them which determines its vulnerability to water scarcity. The human security implications can be traced through the impacts of droughts in agriculture-related activities, as this natural hazard significantly reduces the availability of water, and these economic activities are one of the first and most affected. The State security implications are addressed by studying the strategic impacts of energy insecurity, as the energy matrix of Chile has a large hydropower component, and thus energy security depends on the hydrological conditions. Energy security is a key element in the security of a nation-state, because energy drives the economy, entails the exploitation of natural resources, and both the functional integrity of nation-states and the general well-being of its population depends on it. As shown in Chapter 3, the scarcity of water affects State security in Chile, because when the hydrologic conditions cannot meet the energy demands, Chile loses part of its autonomy, being exposed to exogenous forces and actors. Due to its geopolitical situation, the energy needs of Chile are used as leverage by one of its neighbouring countries in a long- standing, historical territorial dispute. This illustrates how droughts and their associated water scarcity, impact wider patterns of security relations, becoming a

14 source of strategic vulnerability. Chapter 4 analyses and contextualizes the security implications of water scarcity, and addresses the potential benefits and drawbacks of ‘securitizing’ this problem.

15 16 Figure 1: General map of Chile

Source: Geology.com in Speiser, 2008

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Chapter 1: Research Framework

Methodology

This thesis is based primarily upon qualitative research conducted in order to determine the human and State security implications of water scarcity in a nation-state. It is an exploratory research that aims to unravel the connections between the natural environment and politics, including security, by studying the case of Chile. It uses a case-study approach to understand the political implications of droughts at the unit and sub-unit levels. As defined by Gerring, a case study is an intensive study of a single unit for the purpose of understanding a larger class of (similar) units.5 The author suggests that this type of research is particularly useful when the strategy of research is exploratory, rather than confirmatory, and when (internal) case comparability is given precedence over (external) case representativeness.6 In this sense, Flyvberg highlights that it is often more important to clarify the deeper causes behind a given problem and its consequences than to describe the symptoms of the problem and how frequently they occur.7 Given the breadth and complexity of the topic, a case study approach facilitates a deeper comprehension of the links between water scarcity, politics and security, and how this dynamic affects Chile in particular. When compared with other methods of inquiry, case study research is subject of two recurrent criticisms. The first one is the selection bias. George and Bennett point out that “Authors of small-n studies appear vulnerable to the selection critique because they often investigate cases where an outcome is known to have occurred or almost occurred.”8 Nevertheless, Mahoney and Rueschemeyer argue that all qualitative studies select their case studies starting from the effect, because the main interest is to know how these cases reached the observed result.9 In this sense, it is important to emphasize that a single unit analysis is not subject to the same kinds of selection issues that arise

5 Gerring, 2004:342 6 Ibid 7 Flyvbjerg, 2006:229 8 George and Bennett, 2005:23, quoted in Bennett and Elman, 2006:460 9 Mahoney and Rueschemeyer (2003) quoted in Sotomayor, 2008:165

19 in large-n ones,10 because more relevant than “…the net effect of a cause over a large number of cases, is to unravel the causes that interact in the context of a particular case or a few cases to produce an outcome.”11 The second critique is the bias toward verification: to confirm the researcher’s preconceived notions. While it is impossible to absolutely rule out this criticism, the verification bias is not exclusive to case study research. It is a problem that every researcher needs to deal with and overcome, regardless of the method chosen. Besides, the methodology literature indicates that the case study approach actually contains a greater bias toward falsification of preconceived notions than toward verification.12 I chose Chile as the unit of analysis, first, because it is a nation-state, which allows replicating and comparing this same study with other similar units. Second, given that this thesis aims to map the human and State security implications of water scarcity, I selected a nation-state that is indeed affected by the scarcity of water. While acknowledging that Chile might not be the most representative unit, because water is not a scarce resource in every nation-state, it is nonetheless a unit that allows exploring in depth, in a multidimensional manner, the relation between this particular environment-related problem, politics and security. Thus, the results might be significant for other units for which the scarcity of water is a problem. This research focuses in droughts for four reasons: first, they are one of the major drivers of the natural availability of water; second, they are already a recurrent event in a significant part of the Chilean territory; third, when they occur they affect a larger area than other extreme events, such as floods, and thus the scope and severity of their effects are more significant; fourth, and most important, because they impact directly the energy security of Chile, which in turn has effects in both human and State security dimensions.

General framework My thesis studies the political consequences of water scarcity, a problem that is physical and social in nature. Therefore, my framework and analytical approach draw on several scholar disciplines, many of which are interdisciplinary fields. These disciplines include International Relations, Geography and History, which I will briefly

10 Mahoney, 2007 11 Bennett and Elman, 2006:458 12 Flyvbjerg, 2006

20 describe. The reader should bear in mind that I am a political scientist studying hydro climatic events, which is no easy task even for trained specialists in the specific ‘hard- science’ fields. Geography studies the relationship between nature and humans, the interplay of the land, its resources and features with its inhabitants. Chile’s physical geography is unusual and its features strongly determine human activity and development in each region. In its northern end is located the driest place on Earth and in its southern end, the third reserve of freshwater in the world. Geography facilitates understanding how the physical conditions affect and determine the impacts on human security of droughts, particularly how they affect poor rural population. Additionally, a geographic perspective assists comprehending the mechanism through which a climatic event has effects on international relations and the regional security complex. History is the discipline that studies the past, mainly focusing on humans and the relationship between anthropocentric activity and its environment, in order to understand it. The study of facts and events, and how these were and are articulated throughout time facilitates explaining the dynamics and relations between nation- states. Historical analysis is particularly useful to understand the political impacts of water scarcity in the regional context of Chile, since the relations with its neighbours are determined by past events. International Relations study the relationships between countries, or nation- states. Along with the evolution of international relations, the discipline now includes also the relations between nation-states, international organizations, non-governmental organizations and multinational corporations. There are many aspects to IR and it can be approached through economical, legal, security or political economy angles, just to name a few. This research is part of the sub-field of Security Studies, whose original focus was the security dynamics between nation-states and the factors that determined it, concepts related to the realist paradigm. With the emergence of constructivism, among other reasons, security studies has widened its scope, and now encompasses matters such as the social and material conditions that determine the perceptions of security and insecurity and peace studies. Both, the traditional and new approaches in Security Studies are relevant for this research, since the former give insight in the dynamics between Chile and its neighbours, and the latter permit addressing the social and environmental impacts of water scarcity.

21 One methodological issue that is important to address when researching in IR is in which research tradition, or paradigm, the thesis is located. To define the ontological coordinates that delineates the research approach. My solution for this problem is not a traditional one, or at least not a mainstream one. Neither realism nor liberalism foresaw the “pacific” end of the Cold War and none of them predicted that communist China would adopt a market-oriented economy after the death of Mao. This happened because none of the different IR research traditions, or paradigms, is absolutely right or absolutely wrong. Each one of them gives partial interpretations of complex realities and in this sense they are valuable, but insufficient in themselves to comprehend the whole. As framed by Snyder: “Each theory offers a filter for looking at a complicated picture.”13 Under this light, the study of IR can be understood as a multilayered construction in which different paradigms overlap each other, according to the particular characteristics and contexts of the problems studied. Therefore, instead of committing to any of the mainstream paradigms —such as neorealism, liberalism, or constructivism—, this research uses a problem-driven approach, and thus develops a framework able to capture and integrate in a comprehensive manner the specific variables involved in this problem. This approach draws on the concept of Analytical Eclecticism, developed by Sil and Katzenstein,14 a bridge-building or synthesis effort aimed to facilitate researchers in IR to integrate different paradigms. Analytical eclecticism is not a new idea. It can be traced in John Dewey’s Reconstruction of Philosophy, in Kuhn’s ideas on paradigms development, or in Nye and Keohane’s Power and Interdependence: World Politics in Transition.15 It can also be related to Integral Theory, developed by Ken Wilber.16 Inherent to this analytical approach is a critique of scholars who overlook important data in order to be consistent and coherent with a specific framework. Instead, analytical eclecticism invites us to be strict in observing the facts, but flexible to choosing from particular explanatory paradigms, so as to gain a complete and comprehensive vision of the problems we study.

13 Snyder, 2004:54 14 Sil and Katzenstein, 2005 ; Katzenstein and Sil, 2008 ; Sil and Katzenstein, 2010 15 Nye and Keohane, 1977 16 Wilber, 2001 ; Wilber, 2003

22 Sometimes, realist assumptions will be accurate, or largely accurate, but frequently complex interdependence will provide a better portrayal of reality. Before one decides what explanatory model to apply to a situation or problem, one will need to understand the degree to which realist or complex interdependence assumptions correspond to the situation.17 The analyses produced within research traditions are valuable for the purpose of identifying many of the factors that are likely to matter most. Analytic eclecticism aims to uncover how these factors matter in relation to specific research questions, not to generate an infinite list of causal factors that can influence world politics. Analytic eclecticism intends to generate “Diverse and flexible frameworks, each organized around a concrete problem, with the understanding that it is the problem that drives the construction of the framework.”18 It is important to underscore that one of the risks of this approach is to fall into the trap of just mixing analysis, to throw analytical paradigms in a blender to see what comes out. As David Kang ironically defines it, “[This is not] a plea for research that includes a touch of realism, a dash of constructivism and a pinch of liberalism.”19 This is a fundamental critique and is important not to take it lightly. Analytical eclecticism can be useful because it “Frames and analyses problems as they are understood and experienced by political actors rather than focusing on problems intended to illustrate the intellectual coherence of a particular explanatory framework.”20 Analytical eclecticism is not a mix. Its purpose, and its analytical significance, is to establish a dialogue between different paradigms, so they can enhance each other’s explanatory power. The influence of analytical eclecticism on this research is found, mainly, on the analytical framework. This was developed based on the work of the Copenhagen School, usually associated with post/positivist and constructivist realism paradigms, but it also incorporates elements of the ISDR Risk Reduction Framework and Practices, which includes concepts such as livelihood resources and sustainable livelihoods, which can be located within the constructivist paradigm. Similarly, it can also be found in Chapter 3, in which the analysis of the regional security complex of

17 Nye and Keohane, 1977:24 18 Sil and Katzenstein, 2010:415 19 Kang, 2003 20 Sil and Katzenstein, 2005

23 which Chile is part, and particularly the relationship with Bolivia, draws and historical events such as wars and the geopolitical consequences of them, but also on how these were articulated and how they shape and influence the construction of the other as an enemy, until these days. This research avoids committing to any particular paradigm, because I firmly believe that is more analytically fruitful to focus on the problem and develop a framework that facilitates integrating and understanding the different variables involved, and thus attain an in depth knowledge, rather than narrow the analysis to the constraints and limits of any given paradigm.

Hypothesis, working question and objectives The hypothesis that underpins this research is that certain environment-related problems can impact the security of a nation-state in both its human and State security dimensions simultaneously. Consequently, the working question is: What are the human security implications and the State security implications of the scarcity of water in Chile? The main objective of the thesis is to determine how water scarcity affects Human Security and State Security in Chile. This main objective comprises the following secondary objectives: - To determine the exposure and vulnerability of Chile to water scarcity. - To develop an analytical framework that permits analysing water scarcity through a security understanding. - To determine the analytical bridges that associate human and State security.

Research limitations I would like to draw attention to the course structure of a Masters by Research (MA) program. As determined by The University of Melbourne an MA has duration of twelve to eighteen months,21 in which candidates must produce a thesis of 30,000 words.22 The word count of this thesis, excluding references, footnotes and appendix, is 44,416 words. Additionally, although there are funds available for MA research, these are limited compared with those of PhD programs. These limitations, particularly time

21 See http://gradresearch.unimelb.edu.au/handbooks/mres/intro.html#duration 22 This is the length determined by the Graduate School of Humanities and Social Sciences. See http://graduate.arts.unimelb.edu.au/research/programs/masters-by-research.html

24 frame and funding, explain why I did not conduct face-to-face interviews with relevant stakeholders in Chile. Personal interviews could have potentially provided valuable insights into specific problems address in this research, such as the conflicts between the government and generation companies throughout the electricity crisis. Nonetheless, the absence of this research method did not affect the main objective of this thesis, since the impacts of water scarcity in the different security sectors and analytical levels can be mapped and defined through other primary and secondary sources (detailed in the next section). I will also like to draw attention on the fact that the availability and quality of data and information in Chile is not ideal, due to political and technical reasons. For example the transparency law, that creates the institutional framework to assure the access to public information was approved and came into effect only in 2009. Before this, the legal and institutional framework did not have effective mechanisms to access relevant information and to make authorities or service providers, such as generation companies, accountable. This partly explains why authors, such as Bauer, when addressing the late 1990s electricity crisis, highlight that at that time regulators had tight political constraints to oversee generation companies, and that the governance and conflict resolution mechanisms, among other institutional flaws, were complex and kept out of public scrutiny.23 In regards of technical limitations, in Chile hydrological data is collected and managed by Dirección General de Aguas, and can be requested through their website (www.dga.cl). However, it needs to be specified the weather and river stations, with its respective identification code, information that is not online. In order to gather this information, I contacted Ernesto Brown, one of Chile’s most prominent hydrologists, author of the National Report of Water Management in Chile,24 among other publications. With the aid of Brown and one of his assessors I determine relevant stations and submit request this data, but at the time of submitting the revised version of the thesis, these information was not provided. While specific information of river discharge or rainfall averages could have given a more thorough portrait of the local, regional situation of water in Chile, there are enough academic papers and governmental and non-governmental reports, with up-

23 Bauer, 2009 24 Brown and Saldivia, 2000

25 to-date information, that supports one of the major claims of this thesis: that water in Chile is a relatively scarce resource, because where is more demanded the natural availability is insufficient to meet the demand.

Sources To provide theoretical context for the specific analysis in this thesis I first review key literature in the following scholarly fields: International Relations and Security Studies, Geography and History. The types of sources I reviewed include academic articles, books, databases, governmental reports, press articles and summaries, among other sources. Subsequently the information was compiled, systematized and analysed. Because of different areas or dimensions analysed in this research, it is important to detail the sources used to develop each topic. In regards to the characterization of the ecological conditions and socioeconomic structure of Chile, I used as base sources the reports of IAP (2008), DMC (2011), INE (2011a), CONAMA (2006), World Bank (2011), ODEPA (2009), CEPAL (2009), UNDP (2008), IPCC (2007a), IPCC (2007b), IPCC (2007c), FAO (2010) and Meza et al. (2010). To determine the occurrence of droughts and its effects on Chilean agriculture and rural areas, I used as base sources the publications of Aldunce and González (2009), Norero and Bonilla (1999), Astaburuaga (2004), Fernández et al. (1999), Meza et al. (2010) and Gayoso and Gayoso (2005); the reports of CNS and IICA (1998), ODEPA (2009), World Bank (2011), IAP (2008), CONAMA (2006), CONAMA (2010), CEPAL (2009) and DMC (2011), together with press articles, reports and dossiers. To define the legal and institutional framework of water and electricity in Chile and portrait the current situation of the energy sector in Chile and Latin America I used as base sources the publications of: Bauer (1993, 1998, 2009), Dourojeanni and Berríos (1996), Peña (1997), Dourojeanni and Jouravlev (1999), Rudnick et al. (2007), Cardoso (2007), Castillo and Maldonado (2004), Prieto and Bauer (2012), Francke (2002); and the reports of: AGN Chile (2011), ENDESA Chile (2009), GasNet (2010) ME (2012), OLADE (2010) and CNE (2008). To establish the impacts of droughts on energy generation in Chile and sketch the electricity crisis of 1998-99, I used as base sources the publications of: Díaz et al.

26 (2000), Chumacero et al. (2000), Fisher and Galetovic (2001), Rozas (1999), Galetovic (2005), Bernstein (1999), Maldonado and Palma (2004) and Rudnick et al. (2007). To outline the relations in Latin America and specifically depict the relations between Chile and its neighbours I used as base sources the publications of: Francisco (2009), Hernández and Ebensperger (2010), Domínguez et al. (2003), Colacrai (2008), Collier and Sater (2004), Buzan and Wæver (2003), Fuentes (2008), Contreras (1999), Sotomayor (2008), Wehner (2010), Orias (2002), Mendoza (2006), together with different governmental reports and press articles. In relation to the Lauca River Conflict and the Silala River Conflict I used as base sources the publications of: Tomasek (1967), Glassner (1970), Mulligan and Eckstein (2011), López (2008), Toromoreno (2000); and the reports of DGA (2004), UNEP (2007) and the Department of State (1966).

Literature Review

Of the various contemporary environment-related problems, global climate change is one of the most pressing ones. Earth’s history has recorded analogous processes of climate variation, though not as accelerated, but there are no records in human history of a global change of this scope: “As a species, we have entered uncharted terrain.”25 The United Nations Division for Sustainable Development (UNDSD) defines climate change as “An inevitable and urgent global challenge with long-term implications for the sustainable development of all countries.”26 It is estimated that, already, climate change costs the lives of about 300 thousands people every year, and that another 325 million people are seriously affected by it. The global economic losses amount to over US$ 125 billion.27 During the last century an upward trend in global temperatures has been observed, both terrestrial and maritime, that is increasing constantly and progressively.28 For example, despite the fact that in the period 2007-2009 the sun reached an all-time low since satellite measurements began (early 1970s), which should have had a cooling effect, temperature records have been broken this century.

25 Campbell, 2008:27 26 UNDSD, 2010 27 Global Humanitarian Forum, 2009 28 Allison et al., 2009:13-14

27 Every year between 2001 and 2008 has been among the top ten warmest.29 Data collected during the last forty years suggests that the oceans have been taking up eighty four percent of the total heating added to the Earth’s climate.30 Rising sea levels are consistent with global warming. There is high confidence31 that the decline registered in snow, ice and frozen grounds in both hemispheres, like mountain glaciers and ice caps, has increased the number and size of glacial lakes, augmented ground instability in permafrost regions and mountains (rock avalanches), and led to changes in some Arctic and Antarctic ecosystems.32 There is high confidence that some hydrological systems have also been affected through increased runoff and earlier spring peak discharge in many glacier and snow-fed rivers as well as through effects on thermal structure and water quality of warming rivers and lakes.33 Similarly, in terrestrial ecosystems it has been observed that there is a trend in many regions towards an earlier ‘greening’ of vegetation, which is consistent with the earlier spring peak discharges. These changes are with very high confidence linked to recent warming.34 Both rainfall and temperatures are predicted to become more variable, with a consequent higher incidence of droughts and floods, sometimes in the same place.35 This is particularly relevant for Chile because several maximum rainfall intensities recorded in the national territory were recorded during dry periods, in areas with both arid and humid climates.36 Globally, the area affected by drought has likely increased since the 1970s. If the trends continue as current, it is expected that rising temperatures are going to accelerate the hydrological cycle, causing an increase in precipitations in the tropics and higher latitudes, but a decrease in dry semi-arid to arid mid-latitudes. Water-scarce areas of the world will generally become drier and hotter.37

29 Ibid 30 IPCC, 2007a ; Allison et al., 2009 ; Attrill, 2009 31 The IPCC uncertainty guidance defines a framework for treatment of uncertainties in their reports. Where uncertainty is assessed quantitatively a confidence levels scale is used to express the assessed chance of a finding being correct: very high confidence at least 9 out of 10; high confidence about 8 out of 10; medium confidence about 5 out of 10; low confidence about 2 out of 10; and very low confidence less than 1 out of 10. Henceforth, italics are used in accordance to IPCC’s guidance. More information in http://www.ipcc.ch/meetings/ar4-workshops-express-meetings/uncertainty-guidance-note.pdf 32 IPCC, 2007d ; Parry, 2007 33 IPCC, 2007a ; Allison et al., 2009 34 IPCC, 2007a 35 Turral et al., 2011 36 Pizarro et al., 2012 37 IPCC, 2007a

28 Starting from the premise that these scientific projections are reliable, it is possible to argue that the compound effect of climate change, population growth and material economic development is going to reduce the relative availability of water. The Food and Agriculture Organization (FAO) states that “One consequence of greater future water demand and likely reductions in supply is that the emerging competition between the environment and agriculture for raw water will be much greater, and the matching of supply and demand consequently harder to reconcile.”38

Water, environment and security As a consequence of the international debate regarding global climate change, in recent years there has been a growing awareness of the security implications of environment-related problems. This has taken the discussion of water scarcity beyond the scientific and academic spheres, into the political and strategic realm. For example, a recent report of the Committee on Foreign Relations of the United States Senate asserts: “Water scarcity is often overlooked, underfunded, and undervalued within foreign policy. Yet a government’s ability to provide and manage access to water is critical for ensuring political, economic, and social stability.”39 More significantly, a year earlier the Secretary of State of the United States (US), Hillary Clinton, gave a speech in the context of the World Water Day, in which she stated: “Access to reliable supplies of clean water is a matter of human security. It is also a matter of national security.”40 The words of the Secretary of State highlight one of the most significant characteristics of water scarcity: that they are a transversal security issue, whose impacts can significantly alter the livelihood of people and the normal functioning of a nation-state. The debate linking water, security and climate change is just the latest in a long string of academic research and policy discussion trying to unravel the connections between environment-related problems, violent conflicts, social and economical welfare, political stability and security. During the Cold War the predominant security paradigm in IR, neorealism, associated security with threats and the use of coercive force between states, encompassing matters of deterrence, balance of power and military strategy. As defined by Walt: “Security studies may be defined as the study of the threat, use and control of military force…the specific policies that states adopt in

38 Turral et al., 2011:xviii 39 CFR, 2011:1 40 Clinton, 2010

29 order to prepare for, prevent or engage in war.”41 Neorealism is a state-centric paradigm that understands the international arena as an anarchic, self-help system, in which each unit pursues its own agenda, forging temporary alliances with other units if these are functional to their own interests. Because the system lacks a central authority, neorealism focuses on the distribution of material power in the international system and in the mechanism (practices) in which units engage in to counteract each other’s power. This results in balance of power dynamics that shapes the structure of the system, and gives rise to what is known as the security dilemma. Under this paradigm the notion of national security is defined in terms of military defence from military threats to the territorial integrity, sovereignty and or regime continuity of a given state.42 These threats could arise either from beyond the country’s border, most often a rival nation-state, or within the borders, subversive or terrorist groups. In this articulation the nation-state is at the same time the reference object and the source of security, which inherently excludes the possibilities of non-military threats to or non- military sources of security. The end of the Cold War, together with an increasing awareness of the impacts of anthropogenic activity over the environment, and its social, economical and political consequences, triggered an academic and policy debate for a wider, more comprehensive conception of security. One that could account for the new challenges imposed by a changing international political arena and the different global and local ecological pressures. As The Commission on Global Governance Report states: “Global security must be broadened from its traditional focus on the security of states to the security of people and the planet.”43 ‘Security’ was expanded both in its scope and content, in its possible referent objects and in what phenomena can be considered a threat. As Rothschild explains it, the broadening of the security agenda was done in four operations:44 firstly, downwards, from the security of nations to that of groups and individuals (human security); and secondly, upwards, from the nation-state to the international system and or the biosphere (ecological security). These two operations broaden the possible

41 Walt, 1991:212 (emphases on the original) 42 Pettman, 2010:33-52 43 Quoted in Rothschild, 1995:55-56 44 Ibid

30 referent objects of security.45 Because not every referent object is affected in the same way or by the same threats, the third operation was horizontal, to other relevant sectors, like the economic, social or environmental. The fourth operation, the one regarding the political responsibility of securing security is “Diffused in all directions from national states, including upwards to international institutions, downward to regional or local governments, and sideways to nongovernmental organizations, to public opinion and the press.”46 The new security conceptions that arise from these operations can be grouped under what is known as critical security studies.47 As explained by Krause and Williams48 and Peoples and Vaughn-Williams,49 more than a precise theoretical label or a specific research project, critical security studies are an orientation towards the study of the understanding and the practices of security. They imply questioning what it means to be secure, and thus what can cause insecurity, and what or who should be secured, and by what means. By doing this, it necessarily questions the assumptions taken-for-granted that underpinned the traditional/realist conception of security. As Dalby summarized it: “What is to be secured, how and by what means are questions conventionally answered by focusing on the state. But when environment is added into the consideration of security, it may well be that the state is no longer the obvious referent object of security.”50 Like the broader field of Security Studies, there are many different approaches to critical security studies. It can encompass gender perspectives, green theory, post- colonial critiques, among others. Because of its wide scope, it can be classified along several axes: traditional versus broadened, by temporal narratives (pre/post Cold War or 9/11 terrorist attacks) or by schools of thoughts (Copenhagen, Paris or Welsh).51 The present review classifies the literature by the axis of security’s referent object, either the nation-state or human beings as such. While acknowledging that authors like Pirages, have explored the idea of ecological security –to secure nature as such due to

45 Authors like Krause and Williams (1996) and Barnett (2001) refer to the operation of considering alternative referent objects of security –individuals, the biosphere-, a deepening rather than a broadening of security. 46 Rothschild, 1995:45 47 Not to be confused with Critical Security Studies (upper case), that is used to denote the security approach that draws on the Marxist tradition of Critical Theory. 48 Krause and Williams, 1996 ; Krause and Williams, 1997 49 Peoples and Vaughan-Williams, 2010 50 Dalby, 2002 51 Peoples and Vaughan-Williams, 2010

31 its intrinsic value–, this review focuses on those research streams more directly associated with environment-related problems and their connections to human beings.

Environmental degradation, scarce resources and violent conflict: the environment as a security issue Lester Brown coined the term environmental security in his article Redefining National Security,52 where he highlights the relevance of environment related threats, and the limitations of military means to account for them. Concurrently, authors like Richard Ullman,53 Jessica T. Matthews54 and Norman Myers55 argue that there was an underestimated relationship between environmental issues and security: ecological degradation due to military or civilian activity, food shortages, deforestation, or changes in weather patterns, all have the potential to significantly alter economic development and social welfare of individuals and nations alike. But more important, environmental degradation and resource scarcities could potentially generate interstate conflicts, the so-called eco-wars. These new approaches can be summarized in Richard Ullman’s widely cited (re)definition of security threats. In his article Redefining security the author defines a threat to national security as: An action or sequence of events that (1) threatens drastically and over a relatively brief span of time to degrade the quality of life for the inhabitants of a state, or (2) threatens significantly to narrow the range of policy choices available to the governments of a state or to private, non- governmental entities (persons, group, corporations) within the state.56 This definition broadens the security concept by including other sources of threats, like the environmental or economical, but it is still framed from the nation- state. This first generation or wave of environmental security scholars57 certainly contributed to expand the horizons of security. However, they were criticized because of their arguments being based more in ‘anecdotal’ evidence rather than on empirical grounds.58 It was argued that instead of giving new theoretical insights or creating a

52 Brown, 1977 53 Ullman, 1983 54 Mathews, 1989 55 Myers, 1989 56 Ullman, 1983:133 57 When reviewing the literature on environmental security Rønnfeldt, 1997 uses the ‘generation’ label, while Levy, 1995 uses the ‘waves’ label. 58 Deudney, 1990 ; Deudney, 1991 ; Barnett, 2001 ; Dalby, 2002 ; Page, 2002

32 new analytical tool, they only contributed to generate a conceptual muddle, which instead of having redefined just de-defined security.59 As Lonergan et al. pointed out, these first efforts to expand security gave origin to “A number of plausible hypotheses, but rigorous studies were lacking.”60 During the 1990s a second generation emerged trying to fill this gap by systematically exploring the causal links between resource scarcities, migration and armed conflict. Probably the most renowned of these efforts is the Project on Environment, Population and Security, lead by Thomas Homer-Dixon, also known as the Toronto group.61 Based on case studies chosen within the developing world, they traced their social, political and economical processes to establish a casual chain between resource scarcity and conflict. With a similar purpose, the Environment and Conflicts Project (ENCOP) led by Günther Baechler, aimed to link environment- related problems to development and social change in the global South.62 Despite differing in their methodology and theoretical background, both research projects tried to establish a link between environment-related problems and violent conflict on the basis of aggregated empirical data. Shared relevant findings are that environmental scarcity acts mainly by generating social effects, such as poverty and migrations, which contribute to economic decline and to weakened states, which in turn can trigger ethnic conflicts, insurgencies, and eventually coups d’états. As both projects determined, environmental scarcities usually are an exacerbating factor, but they rarely constitute a direct (single) cause of inter-state armed conflicts. Both projects have been heavily criticized for their methodological approach. In the case of the Toronto Group, because they developed extremely complex models that only give general results; because the method lacks of null cases (non-conflict) to falsify the hypothesis;63 and because they focused only on the state and sub-state level.64 While ENCOP did include control variables, the model developed was extremely complex, and thus hard to replicate. In a more recent attempt, the Environmental Change and Conflict Report tried to overcome these methodological limitations, by using improved indicators of environmental change, with more updated data, as well as more recent models of

59 Deudney, 1990 ; Deudney, 1991 ; Levy, 1995 ; Dalby, 2002 60 Lonergan et al., 1999 , as quoted on Page, 2002:30 61 Homer-Dixon, 1999 62 Baechler, 1998 63 Barnett, 2000 ; Page, 2002 ; Dalby, 2007 ; Haid et al., 2008 64 Gleditsh, 1998 ; Barnett, 2007 ; Haid et al., 2008

33 conflict.65 They found that growth rate of cereal yield, carbon dioxide emissions, and forest area is negatively related to the likelihood of civil war onset, while permanent cropland area is positively related to civil war onset. While most of the research has focused on the relationship between environmental scarcities and violent conflict, some authors have tested the reverse hypothesis: that the abundance of natural resources drives conflict. Collier and Bank66 and de Soysa,67 based on statistical models, found a more significant correlation between competitions to gain dominant control over income generating resources, such as oil or diamonds, than over scarce resources. Consistent with these findings, testing several different conflict hypotheses in regards to oil-related conflicts, Strüver found that international resource conflicts are primarily a function of resource abundance,68 both in the target country as well as on the side of the conflict initiator. Consequently, the author stated that resource scarcity is less relevant than often assumed as a driver for conflict.

Hydropolitics: Water in International Relations Since the beginning of the environmental security narrative, water has been a major topic of debate. The ubiquity of water, present in every aspect of human life, the manifold impacts related to water scarcity, and the uneven distribution of water at the global, regional and local levels, have lead environmental security scholars to hypothesize that water scarcity is a potential source of both, intrastate and interstate violent conflicts.69 It was argued that the quality of and the accessibility to fresh water, the degree of its scarceness, together with the political situation in transboundary basins were indicators of potential water conflicts. Accordingly, due to its relative scarcity and complex geopolitical situation, the Middle East was defined as the “Clearest example of a region where fresh water supplies has strategic implications.”70 However, current available evidence does not support this assumption. Rather, it

65 Haid et al., 2008 66 Collier and Bank, 2000 67 de Soysa, 2000 68 Struver,̈ 2010 69 Gleick, 1993 ; Remans, 1995 ; Homer-Dixon, 1999 70 Gleick, 1993:84-85

34 suggests that more than a direct cause of violent conflict,71 water has been used in a context of violence as a tool to obtain political or military leverage in a conflict.72 The Transboundary Freshwater Dispute Database (TFDD) is a project of the Oregon State University aimed to empirically identify drivers and indicators of future water conflict.73 The two aspects that distinguish this research are its scope and the unit of analysis on which it is based. The TFDD comprises every reported interaction between two or more nations, whether conflictive or cooperative, where water was the driver of the event, in all of the world’s international river basins during the period 1948–1999. The other novelty of this research is that it uses the river basins themselves as the unit of analysis, instead of nation-states. Each of these basins was examined for aspects of stress, such as supply versus demand, droughts, and changes in the physical system within the basin’s riparian states. In addition to biophysical and socio-economic indicators, it was also considered in a geopolitical dimension: the institutional capacity of the different actors involved to absorb the physical changes in the basins. This capacity is fundamentally shaped by the existence of international treaties and the patterns of amity/enmity that govern the relations, among other aspects. In total there were 1,831 events of water conflict/cooperation recorded, out of which 507 were conflictive, 1,228 cooperative and 96 neutral or non-significant. One of the salient findings of this project was that, contrary to the commonly accepted idea that water is or may be a cause of conflict, since events of cooperation more than double those of conflict, it appears that water actually fosters cooperation. In fact, many of the factors traditionally considered to be relevant indicators of international conflict, and of water conflict in particular, showed no statistically significant association. Average climate, basin water stress, spatial proximity, government type, dependence on freshwater for agriculture or energy, among others, did not show a significant association with conflict over international freshwater resources.74 Similarly, common assumptions such as countries that generally cooperate over water, and countries that generally dispute over water found a very weak positive correlation. Not even arid environments or “creeping problems”, like the degradation of water quality or climate change induced hydrologic variability, probed to be

71 Wolf et al., 2003 72 Gleick, 2008 73 Wolf et al., 2003 ; Yoffe et al., 2004 74 Yoffe et al., 2004

35 significant drivers of conflict.75 The factors that did show a slight association with conflict over freshwater resources were high population density, low per capita GDP, and overall unfriendly relations between countries. Consequently, as the authors framed it, if most commonly assumed indicators do not actually indicate water dispute, then what does? The TFDD results suggest that “Institutional capacity within a basin, whether defined as water management bodies or treaties, or generally positive international relations are as important, if not more so, than the physical aspects of a system.”76 Rapid, sudden or extreme changes in the physical or institutional component of a basin seem to be better indicators of conflict or cooperation, because institutional mechanisms facilitates for managing or mitigating these changes. Hence, geopolitical factors are more relevant than the biophysical or socioeconomic conditions when approaching transboundary issues (Table 1).

Table 1: Aspects of a transboundary basin that enhance resilience or increase vulnerability - International agreements and institutions, such as RBOs. Characteristics - A history of collaborative projects. that enhance - Generally positive political relations. resilience - Higher levels of economic development. - Rapid environmental change. - Rapid population growth or asymmetric economic growth. Aspects that - Major unilateral development projects. increase - The absence of institutional capacity. vulnerability - Generally hostile relations. - Natural climatic variability –rainfall patterns with frequent periods of floods and drought-. Source: UNEP, 2007

If the relation between environment-related problems and security is broken down into biophysical, socioeconomic and geopolitical conditions (indicators that encompass the five security sectors), with all the methodological and theoretical caveats pertinent to the case, it is possible to assert that the results of the TFDD are in line with those of the Toronto group and ENCOP projects. These three research efforts established that environmental problems were rarely a direct cause of violent conflicts. While the Toronto and ENCOP projects state that environmental problems combined

75 Wolf et al., 2003 76 Ibid:51

36 with socio-economic factors, such as ethnic or social inequalities, could trigger violent conflicts, the TFDD project’s main conclusion is that geopolitical factors are key in defining a violent or cooperative outcome. Probably the most relevant contribution of these research efforts is that they have established a link between environment-related issues and security. Environmental factors have been defined lately as ‘threat multipliers’.77 Extreme weather events, sea rising, pollution or resource depletion, through their impacts on the economic and social sectors, have the capacity to increase inequalities and poverty, exacerbate ethnic tensions, erode state capacities or legitimacy, among others, and consequently impact people’s lives. Regardless if they are framed within strategic-political understanding or from a people-centred perspective, there is growing consensus about environmental factors being, at least, a source of insecurity.78

Securitizing the environment Securitization Theory is one of the most significant contributions to the security debate by the so-called Copenhagen School.79 Securitization is when a political issue is transformed into a security issue, prioritizing it over others in order to mobilize resources. A securitization move is “The move that takes politics beyond the established rules of the game and frames the issue either as a special kind of politics or as above politics.”80 As understood by the authors, in the international system security is about survival, thus a security issue is one that presents an existential threat to a designated referent object. The special nature of security threats justifies the use of extraordinary measures to handle them. Thus, a successful securitization move has three components (or steps): existential threats, emergency action(s), and effects on inter-unit relations by breaking free of rules. Because an issue becomes a security issue or a threat when it is presented as such, one of the key elements of this theory is the “speech act”. In every securitization move, “The meaning lies not in what people consciously think the concept means but in how they implicitly use it in some ways and not others.”81 By using the ‘security’ label a relevant security actor declares an emergency condition, claiming a right to use

77 Dabelko, 2009 78 Deudney, 1990 ; Keller, 1996 ; Buzan et al., 1998 ; Myers, 2002 79 Most of the scholars associated with it worked at the Copenhagen Peace Research Institute. 80 Buzan et al., 1998:23 81 Ibid:24

37 whatever means are necessary to block a developing threat. “The distinguishing feature of securitization is a specific rhetorical structure.”82 When something is qualified as an international security issue it is with the intention –openly declared or not– that it should take absolute priority above other issues. As suggested by Buzan et al., one way to determine the relevance and effectiveness of a securitizing move is by its impact on other, wider patterns of relations. Given the political function and significance of the word security, a broadening of the security concept also widens the range of issues for which a state can call for a mobilization of resources. Consequently, when referring to the concept of environmental security, it is mandatory to define precisely what is the referent object being secured, to be able to identify specific threats and to determine the relevant security actors involved, in order to establish the most appropriate means to deal with threats. The environmental security label has been used to secure either nation-states or individuals, two dimensions that usually entail different sets of actors and measures. In this line of thought, several authors have raised concerns about the appropriateness of ‘securitizing’ the environment. Given that security has always been understood as part of the military realm, some scholars claim that it might be counterproductive to address non-military issues (environmental) as security threats, because it frames these issues in the wrong set of solutions, being dealt with by inadequate actors with inappropriate means.83 In this sense, Conca warns about the difference between a rhetorical endorsement of environmental security, and institutional changes and value acceptance of this new concept of security,84 as environmental problems might be used to legitimize traditional security practices. In the past the security label has been used to mobilize resources and efforts that are not part of national security, particularly budgetary outlays, to increase the privileges of governments, which ultimately only preserve the prevalent (narrow) security articulation. As Rothschild points out, one of the purposes of redefining security is to directly influence the distribution of money and power.85 Barnett warns about the risks of expanding the security agenda without contesting the meaning of security, as it can lead to perpetuate the failure of traditional security to account for the needs of people. A broader but not deeper security agenda

82 Ibid:26 83 Deudney, 1990 ; Dabelko and Dabelko, 1995 ; Buzan et al., 1998 ; Dalby, 2002 84 Conca, 1994 quoted in Dabelko and Dabelko, 1995 85 Rothschild, 1995:59

38 might end up only securing the interests of states.86 In this sense, Barnett is particularly critical with Ullman because of his North-South perspective, through which environmental threats are such if they endanger US national interests: Ullman views the South’s environmental insecurity as a problem only in as much as it potentially endangers the quality of life for the governments and inhabitants of the North. Little concern is paid to the problems that are experienced in these Other places, problems which are surely of concern in and of themselves (emphasis added in the original)87 Echoes of Barnet’s North-South critique can be found in Hooks and Smith’s ‘Treadmill of destruction theory’. Based on Schnaiberg88 and Schnaiberg and Gould’s89 influential Treadmill of Production Theory, the authors assert that the dynamics of militarism, derived in part from the predominant economic system, have their own expansionary dynamics. The environmental impacts of military activity are not limited to periods of war, as the permanent preparation for war has deep ecological consequences too.90 For example, the US has the largest fleet of modern aircraft, ships and armoured vehicles, which is almost entirely fuelled by oil. As a result, the US Department of Defence is the world’s leading consumer of petroleum.91 While everyone else suffers the ecological impacts, the security gains are enjoyed only by the US. In a similar line of thought, Westing reminds that in wartime environmental manipulation can be –and has been used- with hostile military purposes during wartime.92 Deudney notes that there is little common ground between environmental problems and traditional security actors and solutions. The nature of the security apparatuses of nations, autonomous and highly secretive, is an inappropriate answer to global environmental problems, as these problems require exactly the opposite, interstate cooperation and transparent share of information.93 The author points out that security from violence is not the same as security from environmental threats, because environmental problems are not likely to cause interstate wars. Therefore linking

86 Barnett, 2001 87 Ibid:49 88 Schnaiberg, 1980 89 Schnaiberg and Gould, 1994 90 Hooks and Smith, 2005 ; See also Jorgenson et al., 2010 91 Klare, 2007 quoted in Jorgenson et al., 2010 92 Westings, 1999 93 Deudney, 1990 ; Deudney, 1991

39 environmental issues and security can be analytically misleading and practically counterproductive. On the opposite standpoint, Lodgaard finds a conceptual kinship between security and environmental narratives, as predictability, control and the minimization of risks are essential elements of both, military security considerations and in ecological/environmental management and protection.94 In this sense, Dabelko points out that the security community modus operandi is to plan for every contingency, develop assessments and conduct scenario simulations. Subsequently, there are no reasons why environmental threats should not be addressed as any other conventional threat.95

Human security One of the broadened security approaches that has gained prominence in both academic and policy fields is the human security narrative. As its name suggests, it is a human based conception, in which the referent object of security could be either individuals or communities. This narrative also widens the traditional horizon by linking it with development-related issues. It goes beyond freedom from violence, to focus on the general well being of individuals and communities, what is known as freedom from want. It includes the economic, social and cultural aspects of security, such as health care, access to education, local traditions, civil rights and freedoms, among others. While a conception of security based on people can be traced back to the European thinkers of the Enlightenment,96 there is agreement that the two most direct sources of influence on human security are the Brundtland Commission and the United Nations Development Program (UNDP).97 The former introduced the ideas of ‘common security’ –as opposed to state security– and of sustainable development, a notion of economic growth in equilibrium with social needs and ecological support systems.98 The latter set the idea of human development, a development model that refers to expanding people’s opportunities and choices, improving their lives and livelihoods. Instead of focusing on national income, human development emphasis is

94 Lodgaard 1990, quoted in Graeger, 1996:110 95 Dabelko, 2009 96 See Rothschild, 1995:60-65 97 Paris, 2001 ; Fierke, 2007 ; Peoples and Vaughan-Williams, 2010 98 Hampson, 2002

40 on fair income distribution, poverty alleviation and people’s dignity. In addition to the Brundtland Commission and the UNDP, Nef also highlights the impact of critical theory and the idea of mutual vulnerability in forging this people-based security narrative.99 The term human security was first used in the 1994 UNDP Human Development Report.100 It was defined in terms of two major components, freedom from fear and freedom from want, and of seven elemental dimensions of security: economic security (assured basic income, freedom from poverty), food security (access to food), health security (health care, protection form diseases), environmental security (protection from pollution and a non-degraded land system), personal security (security from physical violence and threats), community security (security of cultural identity) and political security (protection of basic human rights and freedom from political oppression). Since then several authors have built on these components and dimensions. For example, Nef defines five dimensions of human security: ecology, economy, society, politics and culture. The environmental dimension encompasses the natural and biophysical environment in which socio-economic, political and cultural activity takes place. Meanwhile the political dimension comprises the relations, structures and processes of conflict management and power distribution in the socio- economic order. These five dimensions or subsystems are interwoven by what the author defines as ‘bridges’: environment and economy are linked by natural resources; economy and society, by social forces; society and politics, by brokers and alliances; by politics and culture, by ideology.101 The 1994 UNDP report gives equal relevance to both major components, freedom from fear and freedom from want, but as the concept has evolved they have become the division between two schools of thought within human security.102 The broader view –freedom from want- advocates for a perspective that includes threats such as hunger (food security), poverty and shelter (economic security), diseases (health security) and anything that could threaten human dignity. The narrow view – freedom from fear– focuses on freedom from violence, which includes political violence, torture, war and drug use, among others. In 1998, the governments of Canada and Norway signed the Lysøen Declaration, which is the founding stone of the Human

99 Nef, 2001 100 UNDP, 1994 101 Nef, 2001:43-44 102 Amouyel, 2006 ; Human Security Report Project, 2010

41 Security Network. In the declaration they define the human security agenda regarding matters of human rights, humanitarian international law, anti-personnel mines, International Criminal Court, child soldiers, child labour and small, light weaponry. Some scholars have raised concerns over human security and its adoption as a policy framework by some governments, as a hegemonic discourse co-opted by the state, legitimizing the business-as-usual of hegemony and privation.103 In this regard, just as some authors have warned about the risk of securitizing the environment to justify military interventions, some others fear that the ‘humanitarian cause’ can be used as an excuse to intervene in countries domestic affairs, and thus serve western agendas.104 They stress that human security is a Western concept, rooted in this particular culture and philosophy, and although certain principles may be universal, others are not. For example, the Western social paradigm is centred on the individual, while Asian values give great prominence to the community.105 Several authors and institutions have tried to delineate and define human security, but despite almost two decades of debate there is no single definition. As a matter of fact, one of the most recurrent critiques to the human security narrative is that it is too vague, expansive and imprecise. Some authors have pointed out that there are more than thirty definitions of human security,106 each one of them building on different, but ultimately related ideas. For example, ‘cultural security’, which is understood as “The set of psychological orientations of society geared to preserving and enhancing the ability to control uncertainty and fear”,107 and psychological security, “Which hinges on establishing conditions fostering respectful, loving, and humane interpersonal relations.”108 If anything that threatens or jeopardizes the life or the livelihoods of people is a human security threat, then the concept becomes meaningless, as the array of potential threats range from starvation, to political freedom or HIV. As Levy wrote in a different context “Both ’environment’ and ‘security’ are flexible enough to mean almost anything one wishes.”109 One can substitute ‘human’ for ‘environment’ in Levy’s quote and have a no less fitting critique to this narrative. As a consequence of this lack of precise boundaries and definitions,

103 Booth, 2007 quoted in Newman, 2010:88 104 Rothschild, 1995 ; UNESCO, 2008 105 Lee, 2004 106 Paris, 2001 ; Alkire, 2004 quoted in Fierke, 2007 107 Nef as quoted in Paris, 2001:91 108 Reed and Tehranian as quoted in Ibid 109 Levy, 1995:37

42 its critics say that human security fails to become a useful analytical tool as “The more harms that are labelled ‘security threats’, the harder it is to study the relations between them.”110 In spite of this, one of the most relevant contributions of the human security concept is that it brought attention to a different dimension of security. Or to frame it in economical parlance, human security focuses on ‘externalities’ of security issues that have not been addressed by the state-centred security paradigm. Rojas explains it like this: “State security is classical security and involves aspects linked primarily to sovereignty and border issues…Human security addresses more local dimensions, although they involve large masses of humanity. It also addresses global issues that affect humanity, such as environmental matters and pandemics.”111 In this sense, Fierke underscores that human security is more related with the range of issues and conditions that create a state of insecurity, and therefore: “Human security is a reaction to the production of human insecurity. As such, it is less important to find the essential definition of the concept than to analyse the conceptual underpinnings of the practices that make genocide, famine or environmental destruction possible.”112

Environmental security and or Human security? The relation between the environment and security is usually engaged from a fairly narrow standpoint, security of the state, or very broad conceptualization, human security.113 Page elaborated a typology of environmental security, in which he defines environmental national security, when the referent object of security is the nation-state and the range of threats considered military and non-military sources. Correspondingly, when the referent objects are either individuals or communities that could be threatened by military and or non-military-related sources, the author defines it as environmental human security.114 Page and Redclift confer great relevance to environmental human security, as it suggests cognate areas of policy and discourse, such as environmental justice and human rights, which broaden the scope and content of environmental concerns. In this sense, the authors understand environmental security as part of human security, and not the other way around, because

110 Owen, 2004:378 111 Rojas Aravena, 2001:18 112 Fierke, 2007:149 113 Stripple, 2005 114 Page, 2002:35-36

43 environmental threats such as climate change are significant, but not exhaustive, determinants of human insecurity. In contrast, some threats to human security have little or no connection to environmental stress or degradation, like trafficking, drug use or ethnic genocides.115 Most of the environmental security literature focuses on the nation-state, approaching environment-related problems as sources of either intra-state or inter-state violent conflict. Given that empirical evidence shows that their influence is not significant, from a traditional perspective they are not labelled as a security threat. On the other hand, since the germinal definition of the 1994 UNDP Human Development Report,116 which considers environmental security as one of the seven elemental dimensions of human security, environment-related issues have been framed as a source of human insecurity. In fact, UNESCO states that the interaction between environmental security and human security is studied mainly through intergovernmental scientific programmes concerned with water-related issues and associated ecosystems.117 Environmental security and human security are intertwined analytical tools that shed light and give insights on spheres or dimensions of security that are not possible to address through the security of the state paradigm alone. Therefore, the present thesis has chosen neither environmental human nor environmental state security, but just a security framework, without the national or the human adjective, to study the impacts of water scarcity in Chile. One of the main objectives of the present research is to address the overall security implications of a given environment-related problem for a nation state, which entails including both the human and state dimensions. As stated earlier, an environment-related problem presupposes a degree of human insecurity, hence the human dimension needs to be addressed. At the same time, because the unit of analysis is a nation-state, it is necessary to address the politico-strategic implications, or the state security dimension. In what follows I will define the framework of analysis developed to address the human and the state security implications of water scarcity.

115 Page and Redclift, 2002:10 116 UNDP, 1994 117 UNESCO, 2008

44 Analytical framework

This thesis studies the security implications of water scarcity in Chile. Framed in a more abstract fashion, this research assesses the security implications of a non- traditional security issue, of environmental origin, on a nation-state. The chosen unit of analysis is a nation-state, firstly, because it is the most relevant actor in the international arena. Most, if not all, of the analytical frameworks developed in IR, the definitions of what is an analytical level, a unit of analysis and a security sector, are built on the nation-state.118 Secondly, nation-states are an ‘aggregated’ unit, encompassing groups and communities not necessarily homogenous, with different traditions and culture, spread over geographical territories with divergent ecosystems. The intrinsic heterogeneity of nation-states gives the opportunity to address the state and the human security implications simultaneously, which is one of the objectives of this thesis. It is worth noting that by addressing both dimensions simultaneously I by no means intend to equate or homogenize human and state security. While intrinsically related, as nation-states are conformed by human beings, they refer to different spheres or cognate areas of security. Underpinning this research is the assumption that an environment-related problem, such as a drought and its associated water scarcity, affects a nation-state in these two dimensions simultaneously, hence they could be addressed simultaneously as well. Given that the main drivers of water scarcity are droughts and socioeconomic development, the most accessible approach to study the security implications is through the impacts of recent droughts, as they portrait a more accurate sketch of the current vulnerabilities. In turn, the most accessible manner to assess these impacts is to disaggregate them in analytical levels and security sectors. The framework of analysis developed in this research draws on the work of the Copenhagen School, and is complemented with the International Strategy for Disaster Reduction (ISRD) framework for determining vulnerabilities to natural hazards.

118 There is a rich debate in IR regarding what constitutes a unit and what an analytical level; how both are defined, differentiated, and how they interact with each other. For example, Singer (1961) structured a two level scheme: the systemic level, this is the international arena encompassing all nation-states; and the sub-systemic, that could entail one or more nation-states (the unit of analysis). Yurdusev (1993) developed a system with three analytical levels and three units, in which levels –the philosophical, the theoretical and the practical- are ontological locations where explanations can be found; and units are the objects of the analysis: the single/individual(s); the collective/societal, or groups of individuals; and the universal/all-inclusive units (mankind or the international arena). Buzan et al developed a five levels scheme. For more on this discussion see Singer, 1961 ; Moul, 1973 ; Yurdusev, 1993 ; Buzan, 1995 ; Onuf, 1995 .

45 Levels of analysis For Buzan, et al. analytical levels are ontological locations where both outcomes and sources of explanation can be located. Theories may suggest explanations from one level to another, from system structure to unit behaviour or vice versa, but there are no hierarchical relationships between them. Analytical levels are not sources of explanation in themselves, but ontological referents where things happen.119 The five most common levels in IR are: the International system level, which comprises the whole of nations and states; the International subsystem level, defined by the intensity of the interactions or interdependence of nation-states between each other, which may be geographical (EU, OAS), economical (APEC, MERCOSUR), strategic (UNASUR, NATO);120 the Unit level: actors such as organizations, communities and/or a group of individuals, sufficiently cohesive and independent (states, nations, transnational firms); the Subunit level, in which organized groups of individuals within units that try or are able to affect the behaviour of the unit can be found; lastly, the Individual level, the bottom line of most analysis in social sciences. Given that not every environmental problem has the same scope, extension and magnitude, disaggregating the analysis in different levels delimits the extent of the specific problem being studied and the sources or means to attain security.

Security Sectors Corresponding to a multilevel framework, security sectors serve to disaggregate and identify specific types of interaction for analytical purposes. In the traditional articulation, security sectors are conceptualized in a lineal, hierarchical relation, where the political and military have pre-eminence over the others. However, as the oil crises of the 1970s showed, changes in one sector have effects over the others, and most of the time they trigger non-linear chain reactions. Buzan, et al., defines sectors as the following: the military sector is about relationships of forceful coercion; the political sector is about relationships of authority, governing status, and recognition; the economic sector is about relationships of trade, production and finance; the societal sector is about relationships of collective

119 Buzan et al., 1998 120 The Regional Security Complex Theory (develop later) operates at this level.

46 identity; and the environmental sector is about relationships between human activity and the planetary biosphere.121 Every analytical level can be studied, or disaggregated, in these five security sectors, which make sectors the connecting bridge between different levels. This research chose a problem of environmental origin, firstly, because the environmental security sector is “The most ubiquitous of them all, because it interacts with every other sector.”122 In addition, as a commentator points out, environment-related problems trigger systemic reactions since “The new threats to security are of a fractal nature, thus dysfunctions at the micro level (sub-unit) have repercussions at the macro level and vice versa.”123

Regional Security Complex Theory In IR the most frequently used levels of analysis are the international and the unit, which bypass the subsystem level. This approach is not able to capture the regional relevance of specific actors, as certain nation-states are relevant actors in their regional context, but do not necessarily have the same influence at the global or system level. The end of the Cold War, and with it the overriding macrosecuritizations124 that polarized the system level, has allowed for the seizure of the importance of local- regional aspects and actors in comprehending the overall security of nation-states. Another key contribution of the Copenhagen School to security studies is the Regional Security Complex Theory (RSCT), a model of analysis that focuses on the subsystem level. The two basic tenets of this theory are that security dynamics are inherently relational, thus no nation-state security is self-contained, and that security threats travel more easily over short distances.125 A Regional Security Complex (RSC) is conformed by nation-states whose major security perceptions and concerns are related to the extent that their security cannot be analysed or resolved separate from each other. A region is composed of geographically clustered sets of units (nation- states), tied together by different interrelated factors, which are embedded in a larger

121 Buzan et al., 1998 122 Ibid:9 123 Nef, 2001:42 124 The concept of macrosecuritizations focuses on the gap between the middle and system levels, and refers to a situation in international security in which there is an over-arching conflict, such as the Cold War, that can incorporate, align and rank the regional or local securitizations beneath it. As explained by Buzan and Wæver (2009), whatever securitizations existed between Japan and China during the Cold War, they were all subordinated to, or framed within, the overarching global struggle between East and West. For more on this see Buzan and Wæver, 2009 125 Buzan and Wæver, 2003:27-89

47 system (the international level). As defined by the authors: “Security complexes are regions as seen through the lens of security.”126 The conforming units of an RSC must possess a degree of security interdependence sufficient to establish them as a linked set and to differentiate them from surrounding security regions. Each RSC is made up of the mutual perceptions of security and insecurity, which are determined by the mixture of history, politics and the material/environmental conditions.127 Regions are a social construction, therefore in any RSC social, economic and cultural factors, such as shared history or the common cultural embrace of a civilizational area (Arabs, Europeans or South Americans), are as important as geographic proximity. RSCT is a useful analytical tool because it accounts for the overall biophysical, socioeconomic and geopolitical conditions present in a cluster of nation-states, letting the analyst to discern which of these conditions is more relevant for each particular RSC. Regions are enmeshed in a larger, global web of security interdependence. Thus, they are permeable to the influence –or interventions– of other regions and of other globally relevant actors.128 Nonetheless, the most relevant feature in an RSC is the internal relations of the conforming units. The RSCT grants the security analysis not to be overshadowed by exogenous factors, and in that way, sheds light on the significance of local-regional aspects. As the authors point out: “The fact that the regionalist approach features a distinct level of analysis located between the global and the local is what gives RSCT its analytical power.”129 Buzan and Wæver identify 11 RSC’s: North America, South America, Europe, West Africa, Central Africa, Horn of Africa, Southern Africa, Middle East, Post-Soviet Union, South Asia and East Asia. In turn, RSC’s can be subdivided in sub-complexes, a half-level within the regional, with the characteristics of an RSC, but embedded in a larger RSC. Such is the case of South America, which the authors divide into the Southern Cone and Andean North.130 The latter consists of Perú, Ecuador, Colombia, Venezuela and Guyana. The Southern Cone sub-complex encompasses the three great

126 Ibid:44 127 Ibid:40-89 128 The authors define two main types of interaction with exogenous actors: penetration, when outside powers make security alignment with states within an RSC; and overlay, when great power interests transcend mere penetration and eclipse a region’s pattern of security relations. 129 Buzan and Wæver, 2003:27 130 Ibid:304-340

48 powers of the region, Argentina, Brazil and Chile, together with Paraguay, Uruguay and Bolivia, the sub-complex buffer states. The authors acknowledge that Perú has traditionally been included within the Southern Cone, but they consider that its security interdependence is more connected with Ecuador and the Andean North. However, given that the definition of a security complex is of states related to the extent that their securities cannot be considered separate from each other, as it will be developed in the Chapter 3, the security of Chile cannot be understood without Perú. Historical, political, diplomatic and geographic considerations interconnect the security of Chile to its three neighbours, Argentina, Bolivia and Perú, and they are all equally relevant security actors in the RSC.131 Therefore, in the analysis Perú is considered as part of the Chilean security complex.

Hydropolitical Security Complex In IR the term hydropolitics refers to a situation in which one of the drivers of the relations between two or more nation-states is water. Generally used in regards to transboundary basins, the concept of hydropolitics entails “Subsets of (regional) actors that are highly interdependent in the face of one river system.”132 Drawing on the work of the Copenhagen School, Allan133 and Turton134 develop the concept of Hydropolitical Security Complex (HSC). A HSC is a special form of security complex that arises when “A set of states that are geographically part owners and users of technically shared rivers start to consider, as a consequence, this water body to be a major national security issue.”135 One of the salient features of a HSC is that, as a result of the interdependence on shared water systems, water becomes one of the drivers of interstate political dynamics in a discernable manner.136 When the relations between riparian’s are defined by cooperation and amity, or if alliances and joint initiatives foster or strengthen this patterns, it results in a Hydropolitical Complex (HC). Conversely, if relations are governed by patterns of enmity or if competition increases tensions, it results in a Hydropolitical Security Complex (HSC).

131 The significance of these factors is such, especially considering the evolution of regional politics in the past two decades that it is not venturous to speak about a sub-complex encompassing Argentina, Bolivia, Chile and Perú alone. However, this goes beyond the scope of the thesis and it will not be addressed. 132 Buzan et al., 1998:119 133 Allan, 2001 134 Turton, 2001 ; Turton, 2008 135 Schulz, 1995: 97 quoted in Albergaria de Queiroz and Klein, 2010 136 Turton, 2008

49 As explained by Turton, a HSC can be regarded as being a component of a RSC. “The usefulness of a Hydropolitical Security Complex as a concept is that it enables linkages between various actors within a given river basin to be mapped out and analysed in greater detail.”137 Chile and Bolivia share two river basins in which all the aspects that increase vulnerability in a transboundary basin are present.138 The resulting HSC has certain peculiarities, which when incorporated into the overall RSC, transforms the study of the security implications of water scarcity in Chile into a timely and relevant matter of analysis.

Environmental threats or environmental sources of insecurity? Security is a generic term, but what constitutes a security threat or a security issue is an intersubjective, relational construction that depends on the material and social conditions, the actors involved and, above all, on the perception of security and insecurity that each actor develops. As Leyton points out, the word menace comes from the Latin minacia, which entails the intention of a subject to do harm to another. Perception, in turn, derives from percipere, and refers to the representation of feelings generated by the expression of an intention, consciously or unconsciously wielded by another. Therefore, ‘the perception of a threat’ is necessarily the product of some kind of human relationship.139 Given that a threat entails the intention of a subject to do harm to another, environmental-related problems, such as droughts, cannot be threats, because they are not subjects, and thus they cannot have the intention to do harm. They are a natural phenomenon that occurs regardless of any human consideration. However, their impacts do have the potential to significantly alter the well-being of people, and depending on the type, scope, magnitude and scale of the environmental problem being studied, they can also have strategic security implications. The fact that environmental problems cannot constitute a security threat, does not rule out the possibility of them being a security issue, or a source of insecurity. As mentioned before, both human security and environmental security have been criticized for being too vague and imprecise, failing to become useful analytical tools. In order to overcome this, Frederick limit the range of environmental security problems, defining environmental security as “For a state, it represents an absence of nonconventional threats against the environmental substratum essential to the well-

137 Turton, 2001:19 138 See Table 1 in page 24. 139 Leyton, 2000 See also Deudney, 1991:24

50 being of its population and to the maintenance of its functional integrity.”140 For the author, environmental substratum refers to the ecosystems, resources, and natural cycles whose degradation, unsustainable exploitation, or modification could threaten the environmental security of a state, a region or the international community as a whole. This definition has the advantages that it encloses the range of threats, as in order to be a threat, an environmental problem must be positioned beyond the classical array of military confrontation. And because it ties security to the social well-being and to the maintenance of a states functional integrity, it allows for assessment of the impacts of a threat by answering the questions: “Does it attack the quality of life of the inhabitants of the state involved or does it prevent it from functioning normally in one or the other of its main spheres of activity? To what degree is the national interest of the state jeopardized by the threat?”141 The strength of Frederick’s definition is that it embodies the political, economic, social, military and environmental conditions required for the survival of the state and to assure (secure) the well being of its population. Also, this definition helps to narrow and specify the type of environmental threats. It is not just any kind of environmental problem, but one that menaces the survival of the nation-state or that has significant impacts on the livelihoods of its inhabitants. However, this definition still defines environment-related problems as threats, which intrinsically relates security to the military realms, and more traditional articulations of security. This research contends that droughts, although they cannot be classified as a threat, they are a source of insecurity because they are a non-conventional security problem that affects the quality of life of the population and have the capacity to alter the functional integrity of the country, affecting wider patterns of relations (RSC and HSC). Therefore, depending on the particular conditions of the unit of analysis, they can be a source of human insecurity, state insecurity, or both.

A proposed typology of environment-related problems Environment-related problems have different origins, scopes and effects, which range from a local drought that affect rural communities dependent on agriculture, to the rise of global emissions of greenhouse gases that threaten the world’s population as a whole. Therefore, to operationalize the concept of environmental security, and to

140 Frederick, 1999:100 141 Ibid:103

51 delimit the range of environment-related problems that could constitute a security issue (source of insecurity), based on the framework of analysis of the Copenhagen school, I have developed a matrix of environment-related problems as security issues, according to which analytical levels and security sectors its impacts are located in (Table 2). The advantage of this matrix is that it does not discriminate on the origin, source or type of environmental problem, but articulates environmental problems according to the ontological location of its impacts and their severity, that is, how they impact wider patterns of relations and security dynamics.

Table 2: Matrix of analysis of environment-related problems as security issues Security Type\Impacts Analytical level Security sectors dimension Environmental - Social Human Insecurity Unit - Subunit Human - Economic Environmental - Social Strategic Security Unit - Subunit - Economic and or State issue Strategic - Political Strategic – Political Strategic Unit - Subsystem - and or Environmental - State vulnerability System Social - Economic Source: self-produced

Environment-related problems become a source of human insecurity when the most relevant security implications are located at the unit and sub-unit levels, and at the environmental, social and economic sectors, the analytical locations more closely related to the human security framework. Environment-related problems become a strategic security issue if their impacts are located at the unit and sub-unit levels, and together with impacting the environmental, social and economic sectors, they affect either the strategic or the political sectors too. Subsequently, when the most relevant security implications are located at the subsystem or system levels, and at the political and strategic sectors, the analytical locations more closely related to the conceptualization of state security, water scarcity becomes either a strategic security issue or a source of strategic vulnerability, or both. The latter depends on the particular conditions of the unit of analysis, that is to what extent and in which ways the RSC and other patterns of supra-unit level relations are impacted.

52 Framed in a different fashion, if an environment-related problem mainly affects the livelihood of people and or their access to livelihood resources, they become a source of human insecurity. Whereas if an environment-related problem limits the overall socioeconomic capabilities of a nation-state, or if it limits the array of effective policy responses of the incumbent authorities to respond to internal conflicts, then it becomes a strategic security issue. But if an environment-related problem disrupts the functional integrity of a country, to the extent that lessens its relative position in its RSC, or as a great power or superpower, it becomes a strategic security issue or a source of strategic vulnerability. This typology informs and organizes the findings of this thesis.

Water scarcity as a source of insecurity The Food and Agriculture Organization (FAO) defines water scarcity as: “Wherever water availability is less than fundamental water needs, we can speak of water scarcity. Water is said to be scarce when there is a shortfall between what is available and what is required for plant growth and for societal uses.”142 In other words, water scarcity is a situation in which there is an excess of demand over available supply. It is a relative concept, function of the availability of water and its competing uses, and thus it is neither inevitable nor immutable. A drought, on the other hand, can be described as a climatic event characterized by precipitations below means that can last for months, seasons or years. For example, in arid regions it is a temporary severe dry period in contrast to the permanent aridity of the territory.143 Droughts are inevitable, and they usually lead to water scarcity. What transform droughts, and its associated scarcity of water, into a security problem is a nation-state exposure to this natural hazard, that is the presence of people, infrastructure or economic, social, or environmental assets in the places affected, and its vulnerability, the propensity or predisposition to be adversely affected. Droughts are complex phenomena to study, because despite being primarily a meteorological event, their severity is determined by the scope and scale of their social impacts and economic losses. From a meteorological perspective, it is difficult to determine their onset and their end. Since the needs of water differs for every species and varies along the growing process, it is not possible to universally establish valid

142 FAO, 2000 143 ISDR, 2009 ; Meza et al., 2010 ; Dai, 2011

53 thresholds, not even for a given geographic area. The biophysical impacts of droughts depend on the time of occurrence, the duration of the deficit, and the particular characteristics of the territory and the vegetation. They also have cumulative effects that may persist for years after the occurrence, and usually increase the environmental vulnerability of a territory to drought. Thus, there are three main aspects of droughts: their intensity, this is the degree of the precipitation deficit, soil moisture loss or water storage shortfall; their duration, which can range from months, years and even decades; and their spatial coverage, if they affect a small region or complete countries or continents.144 The majority of the indices that measure droughts use the difference between the availability and the demand of water in relation to historical averages,145 but they do not include the socioeconomic effects. With the aim to tackle the socioeconomic consequences of natural hazards, the ISRD developed a framework to identify risk areas, assess impacts, establish early warning systems and design mitigation measures. The framework revolves around three major concepts: natural hazards, vulnerability and risk.146 The latter is defined as the probability of harmful consequences or expected losses resulting from the interactions between natural or human-induced hazards and vulnerable conditions. A hazard is any “Potentially damaging physical event, phenomenon or human activity that may cause the loss of life or injury, property damage, social and economic disruption or environmental degradation.”147 Vulnerability, in turn, is understood as the condition determined by physical, social, economic and environmental factors or processes, which increase the susceptibility of a community to the impacts of any given hazard. Consequently, risk is a dynamic notion that is defined by the conditions and processes that determine the vulnerability of a specific referent object to a particular hazard, or threat. Droughts are a natural hazard because the socioeconomic development of the nations is related to multiple water demands of different users. Most definitions of drought are human-centred, focusing on the potential negative impacts on the livelihood of people and their access to livelihood resources (Table 3). Salas defines it as “A condition of deficit of water resources, enough to have adverse effects on

144 Fernández, 1999 ; Dai, 2011 145 For a detailed account see Dai, 2011 146 ISDR, 2001 147 ISDR, 2009

54 vegetation, animals or humans and their activities in a given region.”148 Fernandez et al. defined them as events in which the demand exceeds the supply of water, creating a deficit that is associated with damages. The authors underscore that if there is no harm it is not a drought, even in the presence of rainfall deficit.149 For its part, the ISDR defines drought as hydro-meteorological hazard that can cause social, economic and/or environmental damages. As stated by the American Meteorological Society (AMS) “Drought should not be viewed as merely a physical phenomenon. It is the result of interplay between a natural event (precipitation deficiencies due to natural climatic variability on varying timescales) and the demand placed on water supply by human- use systems.”150

Table 3: Drought Impacts Economic Social Environmental On agricultural and Public and personal Soil erosion forestry productivity hygiene On cattle-herding Increase in Bush fires productivity unemployment rates Degradation of water On the costs of Deterioration or loss of quality due to treatment and supply of recreational spaces concentration of potable water pollutants On industrial and Increased rates of Degradation of visual commercial activities morbidity and mortality landscape On hydroelectricity Deterioration of native production flora and fauna Desertification Decreased flows under

the ecological minimum Source: Donoso et al., 1999

There are mainly three types of droughts:151 meteorological droughts, when the rainfall reaches 60% or less of the annual normal152 for two consecutive years or more. Hydrological droughts, when there is a continuous deficit in the surface runoff, decreases in the level of groundwater, or artificial reservoirs and surface water flows

148 Salas, 1978 As quoted in Donoso et al., 1999:53 (my translation) 149 Fernández et al., 1999:4 (my translation). 150 AMS, 1997 151 Santibáñez and Uribe, 1998 ; Norero and Bonilla, 1999 ; Dai, 2011 152 Mean rainfall is calculated within a 30-year span.

55 are reduced to a point where they fail to meet the demands of irrigation. Lastly, agricultural droughts, when the amount of rainfall, its distribution, the reserves of water and the losses of water do not meet the growing needs of a particular crop in any stage of growth, causing decreases in performance, yields or total loss of crops. To these three types, the AMS adds a fourth one: socioeconomical droughts, which associates the supply and demand of some economic good with elements of meteorological, agricultural, and hydrological drought.153 From a security perspective, the most relevant is the socioeconomical drought, because it accounts for the impacts on the social, economical and environmental sectors. It is noteworthy that none of these types explicitly refer to one of the most relevant security implications of droughts: their effects on energy security. The relation between water and energy, also known as the water-energy nexus,154 is a key strategic matter for Chile, because hydropower is a major component of the energy matrix of the country. Hydropower is the physical nexus between water resources and energy systems, and thus they have an effect on significant social, economic and strategic areas. In Chapter 3 the geopolitical ramifications of the water-energy nexus are explored. In sum, the ISDR framework facilitates determining the socioeconomic vulnerability of Chile to the impacts of water scarcity. The Copenhagen School framework, in turn, facilitates disaggregating and locating these impacts in the different security sectors and analytical levels. In addition, following the methodology of the TFDD project, geopolitical variables are included in the analysis, which allows for assessing the repercussions on the RSC. In this manner it is possible to address and integrate the human security implications and the state security implications of water scarcity in Chile into one analysis. Paraphrasing Buzan and Wæver, the framework developed in this thesis aims to understand and articulate droughts ‘as seen through the lens of security.’155 As shown in the next chapter, droughts in Chile, and their associated water scarcity, are a natural cycle whose modification has the potential to alter the life of its inhabitants and the functional integrity of the country, in several of the main spheres of

153 AMS, 1997 154 Given that water is needed to produce energy, for hydropower and for cooling purposes for thermo power, and energy is needed to make water available, in recent years scholars and policy makers are drawing attention in the interactions and feedback loops between water and energy systems. See U.S. Department of Energy, 2006 ; Marsh, 2008 ; Bauer, 2009 ; Glassman et al., 2011 155 Buzan and Wæver, 2003:43-44

56 activity. Chile has a major environmental vulnerability to water scarcity,156 and as result of this, droughts are going to be more recurrent, extended and severe in the next decades. Following the proposed typology of environment-related problems as security issues, they can be defined as a source of human insecurity, since they alter the livelihood and the access to livelihood resources for a significant part of the population. They are a source of strategic insecurity, since they jeopardize the generation of energy, affecting the well-being of the population and overall capabilities of the country, and thereby limiting the policy options of the authorities and the potential to give material responses to any given crisis. Lastly, as shown in Chapter 3, they are a source of strategic vulnerability, since a neighbouring country uses the subsequent energy insecurity as leverage in a territorial dispute.

156 According to the Environmental Vulnerability Index (EVI), developed by the South Pacific Applied Geoscience Commission (SOPAC) and the United Nations Environment Programme (UNEP), Chile is an environmentally vulnerable country. In almost all of the weather and climate indicators Chile is vulnerable. More information in http://www.vulnerabilityindex.net/

57 58

Chapter 2: Internal security implications of water scarcity in Chile

During the 1990s Chile was impacted by two droughts. The first one, from 1994 to 1997, began affecting only the northern regions, which are predominantly arid or semi-arid. Insofar as the deficit of precipitations extended geographically and accumulated over time, an event that began as a local problem became a nation-wide crisis that affected two thirds of the territory and more than half of the population. The second drought, from 1998 to 1999, was the worst hydrological drought of the twentieth century. Though it affected a smaller area, the compound effects of these two droughts, in addition to other problems, triggered the most severe electricity crisis in Chilean history. As these examples show, the scarcity of water is a strategic security issue in Chile, because its impacts on energy security affect the livelihoods of the population and the functional integrity of the country. As one commentator frames it, “The fact that a drought helped to cause blackouts shows the country’ s dependence on hydropower.”157 Droughts considerably reduce the availability of water in a territory. But as defined by ISDR, “Drought risk is based on a combination of the frequency, severity, and spatial extent of drought (the physical nature of drought) and the degree to which a population or activity is vulnerable to the effects of drought.”158 The prevailing developmental paradigm in Chile is based on economic growth, which entails the exploitation of natural resources, industrialization and the expansion of the aggregated demand. This model of development augments a nation-state water demand, which in itself transforms water into a scarce resource. Therefore, by analysing the biophysical conditions and the socioeconomic structure of Chile is possible to assess the level of exposure to droughts and how they impact the different security sectors. The present chapter is structured as follows: first there is an outline of the general ecological and socioeconomic conditions that determine Chile’s vulnerability to droughts. Then, the extent and scale of the drought impacts are determined through the study of the two droughts that affected Chile in the 1990s. Finally, the energy security implications are addressed studying the electricity crisis.

157 Bauer, 2009:584 158 ISDR, 2007:23

59 Factors and conditions that determine the security vulnerabilities of Chile to the scarcity of water

Chile is divided politico-administratively in fifteen regions,159 considering similar characteristics in terms of climate, geography, demography and economic activity (Figure 2). The capital, Santiago, is located in the Metropolitan region. These regions are usually grouped in macro zones: Norte Grande (Great North), regions I, II and XV; Norte Chico (Small North), regions III and IV; Central Zone, regions V, VI and VII and Metropolitan region; South Zone, regions VIII, IX, X and XIV; and Extreme South (Patagonia), regions XI and XII.

Environmental sector: ecological conditions Two distinctive features of the geography of Chile are its ‘elongated’ territorial extension and its rugged topography. Chile extends across 38 degrees of latitude, from 17° to 56° south latitude in continental South America, and from 56° to 90° south latitude in Chilean Antarctic Territory. In contrast, the maximum width of the territory is 445 km, while the narrowest part is 90 km, with an average of no more than 150km. It is actually the country with the world’s largest length-to-width ratio (4300 km to about 177 km in average).160 The latitudinal zoning is significantly affected by the presence of two mountain ranges, the Andes and the La Costa (Coastal) range. The former is the longest range in the world and runs all along the west coast of South America from Colombia down to Cape Horn, then sinks in the ocean and reappears in Antarctica, were it is called Artantandes. The Coastal range is present only in Chile, running parallel to the Andes between this and the Pacific Ocean, from Arica down to Puerto Montt. The area in between both ranges is known as the intermediate depression. Here, in the Central and South zones, are found the so-called transverse valleys, smaller mountain ranges detached from the Andes, which disrupt the intermediate depression in an area of 600 km.161 In addition to these distinctive morphologic features, it should be noted the influence of the Humboldt current, a cold, low-salinity northward flow of sub-Antarctic surface waters, rich in nitrates,

159 Up until 2007 Chile was divided in thirteen regions, but that year were added Region XV of Arica and Parinacota, in the Great North Zone, and Region XIV of Los Ríos in the South Zone. 160 IGM, 2008, quoted in Pizarro et al., 2012 161 INE, 2011a

60 phosphates and other nutrients that is home to one of the most productive ecosystems on the planet.162

Figure 2: Politico-Administrative division of Chile

Source: INE, 2008

The vast latitudinal extension of the territory, together with its relief, determined by the Andes and Coastal ranges, and a strong oceanic influence,163 results in a great

162 CEPAL, 2009 ; INE, 2011a 163 For example, in Central Chile the presence of warm sea surface temperature anomalies (SSTA) implies higher frequency of rainy days. Meza, 2005

61 diversity of climates. They can be generally divided in hyper-arid, arid and desertic in the Great north, arid, semi-arid and steppe in the Small north, semi-arid and Mediterranean temperate in the Central Zone, cold temperate climates in the South Zone and cold temperate and tundra in Patagonia.164 The pre-conditions for human life are indicated by the aridity concept. Arid climates are those where rainfall is less than the evapotranspiration165 of permanent vegetation or usual crops. More than half of Chilean territory is arid or semiarid, comprising desert areas (I, II and XV regions), dry and semiarid (Region III and IV) and semiarid and Mediterranean climate (V and Metropolitan Region). The quality of aridity decreases progressively towards the south, finding its geographic border at the Biobío River (at about 37° south latitude). The Central Zone marks the transition between arid, semi-arid and temperate climates.

Temporal distribution of water In Chile the distribution of water resources is not uniform, varying significantly in space and time. A shared characteristic by most of the different climates in Chile is that rainfall is concentrated in one season. In general terms, precipitation levels increase progressively from the coast to the mountains (west to east) and from north to south. In the northern regions, particularly in the high-altitude desert plateaus known as the Altiplano,166 the scarce annual precipitations are concentrated mainly in summer, a phenomenon known as either altiplanic winter or Bolivian winter. In contrast, in the central and southern regions, characterized by a Mediterranean climate, precipitations are concentrated almost exclusively in winter.167 As framed by Astaburuaga “In Chile we have a nine month drought every year…This is why I speak of a permanent drought, which we compensate for with snow accumulation in the mountains.”168 The exception to this pattern in the distribution of rainfall is Patagonia, where there is abundant precipitations all year round, reaching in some specific areas up to 5,000 m a year.169 In Chile major extreme events, such as droughts or floods, are related to the cycles of the El Niño/La Niña-Southern Oscillation, or ENSO. Abundant precipitation

164 Francke Campaña, 2003 ; DMC, 2011a ; INE, 2011a 165 While there is no single definition, it is generally defined as the water lost to the atmosphere from the ground surface, evaporation from the capillary fringe of the groundwater table, and the transpiration of groundwater by plants whose roots tap the capillary fringe of the groundwater table. 166 Altiplano literally means the ‘high-flat’ lands 167 IAP, 2008 ; INE, 2011a 168 Astaburuaga, 2004:69-70 (my translation) 169 IAP, 2008 ; Pizarro et al., 2012

62 is observed while El Niño phase is present and relatively low precipitation is expected in La Niña events.170 El Niño occurs about every two to seven years, with an annual or biennial duration, in which the temperature of the waters of south equatorial Pacific augment, together with a decline in atmospheric pressure, leading to significant increases in precipitations. La Niña is the reverse phenomenon, in which the superficial temperature of the waters decrease, and together with an intensified atmospheric pressure, prevents the normal movement of frontal systems, essential for the formation of clouds that cause precipitation. This is why the presence of La Niña is associated with droughts.171 According to the AR4, during the twentieth century there was a significant decrease in precipitations in subtropical Chile, particularly in middle latitudes during summer and fall seasons. This contrasts with what happened in the eastern side of the Andes, Argentina, where rainfall has shown a significant increase since the mid- twentieth century.172 This decrease in rainfall in the central and southern regions is associated with a lower frequency of days with precipitation and the intensity of precipitation on rainy days.173 Most of the scientific research projects these downward trends are going to prevail. For the Central Zone, especially in the valleys and lowlands, these reductions will be of the order of thirty to forty percent, gaining in magnitude towards the Andes.174 To put this figures in context, in the next forty years the magnitude of expect changes in rainfall patterns is the same of those that occurred throughout the twentieth century.175 Throughout the country temperatures have increased at rates that double the trend of the Southern Hemisphere,176 a tendency that will also prevail for the majority of the territory, with the exception of some areas of the southernmost regions. In A2 there is a projected raise of the mean temperature of about 2°C to 4°C, compared to current conditions in continental Chile. This will be more accentuated in the Andean regions and decreasing from north to south. Expected seasonal warming is higher in summer, exceeding 5°C in some high grounds of the Andes.177

170 Kane, 1999 quoted in Meza, 2005 171 DMC, 2011b 172 IPCC, 2007a 173 Quintana and Aceituno, 2006 quoted in CONAMA, 2006 174 Ibid 175 Aldunce et al., 2008 176 Gayoso and Gayoso, 2005 177 CONAMA, 2006

63 Effects of temperature rise in water reserves The two most relevant natural means of water storage are soil accumulation and snow accumulation. Comparatively, the storage capacity of the soil and vegetal layer is quite low, approximately 10% of the soil volume. That is, a normal rain of 15 mm/day moist 15 cm. of soil. On average during winter, 60 cm. of soil are moistened, which is vital in the periods in between rains. In contrast, given that from the point of view of irrigation in arid regions agriculture is concentrated close to rivers with nival regimes178 and nival-glacier regimes, snow accumulation is more relevant because counteracts the yearly nine-month drought. As precipitations are higher in the Andes than in the valleys, snow melt feeds rivers during spring and summer, while glacier melt feeds them from late summer till autumn. The importance of glaciers is such, that Chile has 80% of the glaciers of South America.179 It is noteworthy that in the regions Great and Small North zones the corresponding area of snow accumulation in the Andes is equivalent to more than one third of the total area of each region. One of the consequences of the overall warming is that, as temperatures rise, so will isotherm 0°C rise in altitude, leading to a reduction in the mountainous area capable of storing snow. Between latitudes 30ºS and 35ºS the snow line lies at an altitude of 3,000 m. If it rises only 400 m, the snow area above it shrinks by 23%. This means that about 5,000 km2 of surface capable of retaining snow reserves will be lost.180 Snow accumulation is essential to fill reservoirs and damns, to recharge groundwater basins and to deliver flow into rivers in thaw period. Depending on the scenario, expected rises of isotherm 0°C range from 300 m to 500 m, compared to current conditions. This will happen in all four seasons, but will be accentuated in the first four months of the calendar year, in the mountainous areas between latitudes 30ºS and 40ºS. The combined effect of the rise in isotherm 0°C and the reduction in precipitations in the mountains sets a complex hydrologic scenario for the future. To illustrate the current effects of climate change, since 2010 Chile has been under the influence of La Niña, and Coquimbo (IV Region) has been one of the most affected regions, totalling seven years of precipitation deficits. During 2011 there were surpluses of rainfall in the valleys of Coquimbo, but deficit of snowfall in the

178 The regime of a river is defined by the seasonal variations in its flow. According to their maximum flow, they are classified as pluvial (maximum in rainy season), nival (thaws), glacier (mainly even, with a moderate maximum in summer) and any combination of the above mentioned. 179 El Mercurio, 2012c 180 CONAMA, 2006

64 mountains.181 As a result, despite the 2011 precipitation surplus, by February 2012 all reservoirs in the region had a deficit, several municipalities were declared water emergency zones and water was being trucked to the majority of the rural population living in the Andean foothills.182

Spatial distribution of water At the country level the average availability of water is quite high, 53,000 m³/person/year, far more than the world average of 6,600 m³/person/year and well above the value threshold considered necessary for sustainable development, 2.000 m³/person/year.183 However, this apparent abundance of water can be misleading, since regional analysis shows a very different reality. In the Metropolitan and the whole of the northern regions, where more than 60% of the population inhabits and most of the economic activity is concentrated, water demands exceed the natural availability of basins. The average of water availability of these regions is 639 m³/person/year, reaching even as little as 200 m³/person/year in some localities.184 Precipitations have a high amount of spatial variability throughout the territory, , in terms of the proportion between maximum and minimum values for both intensity and total amounts (figure 3). In general mean annual precipitation gradually increases from north to south. The latitudinal distribution of rainfall, studied both in coastal areas and in the mountain ranges, has its minimum at 25° 30’S approximately, with values of 0 and 100 mm per year on the coast and in the Andes respectively, and a maximum in the 47° south latitude with 7,000 mm annually in the coastal sector.185 Maximum values for total annual precipitation (South Zone) surpass by more than eighty times the minimum recorded values (hyper-arid areas in the north).186 For example, in the station of Santa Juana, in the Altiplano, rainfall average is 43,9 mm, while in Puelo, in Patagonia, is 3,891 mm (table 4). In regards of rainfall intensity, maximum values were as much as 4.5 times the minimum recorded values. It is worth highlighting that maximum rainfall intensities in Chile do not correlate to higher rainfall amounts during wet periods. In fact, many high

181 El Mercurio, 2012b 182 Ibid 183 World Bank, 2011 184 IAP, 2008 185 Brown and Saldivia, 2000 186 Pizarro et al., 2012

65 intensity precipitations events were recorded during dry periods.187 Similarly, total annual precipitation is not directly related to rainfall intensity, since the distribution of rainfall intensity is similar throughout the territory.188

Table 4: Maximum rainfall intensity in different stations in Chile.

Source: Pizarro et al., 2012

Regarding the effects of climate change, both IPCC scenarios, A2 and B2,189 project increases in precipitations in Patagonia, and decreases between regions II and XIV (Small north and Central and South zones). For the Small North area, B2 scenario

187 Aldunce and González, 2009 ; Pizarro et al., 2012 188 Pizarro et al., 2012 189 The A2 scenario implies high level of greenhouse gas emissions, while B2 scenario considers more moderate levels of emissions. For more details see IPCC, 2007d ; IPCC, 2007c

66 projects a further decline in precipitations for the early period, of around ten and twenty percent compared to A2. For the later period, both scenarios project increases in precipitation in the Extreme South and in the Altiplano, as well as declines in precipitation between regions II and XIV. Changes are more pronounced in A2, between thirty and forty percent.190

Figure 3: Rainfall intensity and mean annual precipitation at different latitudes in Chile.

Source: Pizarro et al., 2012

In terms of the natural availability of the basins, Chile can be divided in four hydrological zones, according to the similarities in discharge and runoff regimes, the type of drainage network and the watershed situation regarding fundamental morphological units.191 The first zone is conformed by the regions I, II, XV and part of the III region, where three types of basins are found: exoreic, with permanent or sporadic runoff; endoreic, emplaced in the Altiplano area; and inactive or a-reic basins, which only exist in this part of the country.192 Most of the year these rivers have

190 IPCC, 2007c ; IPCC, 2007a ; CEPAL, 2009 191 Salazar, 2003 ; Chile Sustentable, 2004 ; IAP, 2008 192 Salazar, 2003

67 sporadic or low flows, in which increases in flow are registered only in summer, when there are precipitations in the Altiplano region. The second zone comprises regions III, IV, V and Metropolitan, in which torrential rivers, with high slope type are found. They have mixed regimes, in which the proportion of the basin that is located at higher elevations determines the relative influence of the pluvial and nival components. The rivers with headwaters in the high mountains have steady flow throughout the year.193 As mentioned above, in the Metropolitan and the whole of the northern regions water demands exceed the basins capacity. Therefore, the exploitation of aquifers is essential to meet the demand of the domestic and industrial sectors, mainly the mining industry. This excessive demand is deteriorating the quality of water in several basins, with major impacts in the livelihoods of rural communities.194 In the third hydrological zone, conformed by the Central and southern regions, Salazar distinguishes the presence of two subzones.195 The North-Central precipitations are concentrated in winter, and thus rivers have pluvio-nival regimes. In the South- Central subzone (south of the Biobío River) total amount of rainfall is considerably higher, and the distribution of precipitations throughout the year is more uniform (table 5). As the National Report of Water Management in Chile highlights, the concentration of population and economic activity in the Central Zone has significantly affected water quality in the basins of this area.196 The fourth hydrological zone corresponds to Patagonia. The basins in the northern area of this zone are characterized by high flow rivers, with pluvial regimes and relatively quiet runoff. In the southern area are located the Patagonian Ice Fields, which generate valley glaciers that feed the inland rivers. These are short length basins that empty directly into the Pacific Ocean.197 At the country level, average runoff, in a natural regime, is estimated at 29,4111m³/s, of which 9,130 m³/s corresponds to the basins located in the area between the III and IX regions, and 20,260 m³/s to the basins of the XI and XII regions. It is necessary to highlight that a major proportion of these runoff ‘water resources’ has

193 IAP, 2008 ; INE, 2011a 194 IAP, 2008 ; Larraín and Schaeffer, 2012 195 Salazar, 2003 196 Brown and Saldivia, 2000 197 Salazar, 2003

68 minimal possibilities of exploitation, because of its geographic origin (islands and small basins in the Andes), which in turn make them economically not viable.198

Table 5: Main basins of Chile

Source: Brown and Saldivia, 2000 In regards of the effects of climate change, for the basins located between 32° to 40° south latitude (Small North and Central and South zones), it is expected a decrease in the flow available, as a consequence of variations in precipitations, and in their seasonal peaks, consequence of variations in precipitations and temperatures. It is also

198 Brown and Saldivia, 2000 ; Salazar, 2003 ; Brown, 2012

69 expected a significant reduction in the accumulation of ice on the glaciers that are present in these basins.199 A recent study based on the A2 scenario modelled the expected changes in flow and precipitations for the four major basins located in the Central Zone, rivers Cautín, Aconcagua, Teno and Illapel. All four basins are expected to see reductions between 20% and 40%, together with temperature increases of between 1ºC and 3ºC. There are seasonal changes in the case of Aconcagua and Teno that will provoke earlier ‘peaks’ in the river flows, and significant reductions in the supply of all four basins.200It is estimated that the river Illapel will reduce its water levels in 12%, between 2011 and 2040, and in 35% between 2070 and 2098. In turn, it is expected that the Aconcagua River will suffer a decline of 7.5% between 2011 and 2040, and of 34.4% between 2070 and 2098. For the rivers located in the South Zone the expected variations are lower: water levels in Teno river will decrease between 4% and 26%, while in Cautín river will decrease between 10% and 25.4%, respectively. The relationship between evapotranspiration and precipitation also illustrates the divergent characteristics of water resources throughout the territory (see annex I). In the basins of the Great and Small North regions this ratio is greater than 90%, while in Patagonia this relationship does not exceed 20%.201 It should be noted that in the northern regions the evaporation rate in the salt lakes and lakes is particularly relevant, since in terms of its volume is comparable, or even superior, to the runoff of several basins.202 This makes clear the high variability of the factors that affect water availability in Chile.

Agricultural profile Climate, morphology and the availability of water are major drivers of the agriculture and natural resource management of a territory, determining its agricultural productive possibilities. Overall, Chile presents restrictive environmental conditions. Of the 75 million ha of the territory, 46,1% are not productive because they are either mountains, ice sheets or eroded.203 Productive soils for forestry and agriculture account for less than 10% of the national territory, of which just 1.1% correspond to soil

199 CEPAL, 2009 200 CONAMA, 2010 201 IAP, 2008 202 Salazar, 2003 203 IAP, 2008 ; ODEPA, 2009

70 without limitations of any kind. The remaining 8,9% its restricted by nature, salinity or topography, among others. Because of its favourable climatic conditions, most of the 5,1 millions ha arable of the country, and thus most of the agricultural activity, is concentrated in the Central Zone. However, a majority of the arable land requires artificial irrigation for an optimal agricultural production. From the point of view of irrigation, agricultural production can be divided in rainfed and irrigated agriculture. Rainfed areas are dependant on weather conditions, because the water supply is limited to seasonal precipitations, which makes it particularly susceptible to the climatic variability. In rainfed areas the impacts over yields depend on the time of occurrence, the duration of the deficit and on the particular characteristics of each crop.204 In rainfed agriculture the rainfall distribution is more critical than the amount of rainfall, as a year with precipitation below average can be beneficial –or not harmful– if the distribution coincides with the different phases of water requirements of crops.205 The impacts of drought on rainfed agriculture are direct and immediate, especially for seasonal crops. In Chile only 2.3 million ha of arid, semi-arid rainfed soil has potential for agricultural production.206 On the other hand, irrigation is the artificial watering of land to assist the growth of crops for productive purposes. This is achieved by the accumulation of water in reservoirs or dams, to be used when it becomes scarce due to natural cycles. The majority of water reservoirs are designed with an inter-annual purpose, to counterbalance rainfall seasonality and mitigate precipitation shortages. In irrigated agriculture the impacts of droughts are more complex and diffuse over time, because their most pernicious consequence is their cumulative effect. A one season drought might not be significant for crop yields or product quality, while a drought that lasts for years can project its effects for seasons after the water availability returns to normal. Irrigation is important for Chilean agriculture as 40% of the cultivated area and a large proportion of high value export depends on it.207 It is noteworthy that during El Niño year’s evapotranspiration decrease due to the combined effect of higher cloudiness and higher vapour pressure, while in La Niña period’s

204 Fernández et al., 1999 ; Norero and Bonilla, 1999 ; IAP, 2008 205 Badilla and Cuadrado, 1977 cited in Aldunce and González, 2009 206 ODEPA, 2009 ; Turral et al., 2011 207 World Bank, 2011

71 increases. As a result, in La Niña phase there is an increase of 20% in total water demands in the Central Zone, and thus irrigation needs tend to augment.208 In Chile the predominant irrigation technique is surge flooding, or surface irrigation, that has an efficiency rate of 10% to 45%, compared to the 60% to 80% of technified systems.209 Currently of the 3,4 million ha with agricultural use only 1.1 million ha have some sort of technified irrigation system. That is, only 30% have a resource efficient irrigation system.210 Furthermore, 16% of the water that runs through the different basins is used for irrigation, out of which a mere 4% is managed through reservoirs. In other words, 84% of the water with irrigation potential is literally poured into the ocean.211 This is relevant because 73% of the water consumed in Chile is destined to irrigate that 1,1 million ha for agricultural production.212 Furthermore, agriculture and forestry alone accounts for 77% of water used, while only 5% is for household use.213 That is, the most water-intensive activity is at the same time the least resource efficient. Precisely in the areas where agricultural activity is concentrated, Small North, Central and South zones, it is expected that as a consequence of climate change the annual water deficit will increase, which in turn will enlarge the arid and semi-arid areas in these zones. The most affected areas are located between the Metropolitan and the VIII regions.214 Accordingly, rainfed agriculture will be the most affected by climate change, because it will suffer the impacts of changes in both temperature and precipitations. In contrast, irrigated agriculture will be affected only by the rise in temperature.215 However, variations in thermal regime could be offset by changes in sowing seasons. Different studies have established that the regions of the world that will be most affected by global climate change are those that are arid, semi-arid and mountainous with important differences in height.216 Chile has the driest desert in the world, more than half of the territory is either arid or semi-arid, and two mountain ranges cross the territory from north to south. In other words, Chile meets all the environmental

208 Meza, 2005 209 Norero and Bonilla, 1999 210 Crespo quoted in El Mercurio, 2012d 211 Martin, 2012 212 World Bank, 2011 213 El Mercurio, 2012d 214 CONAMA, 1999, quoted in Aldunce et al., 2008:13-14 215 CEPAL, 2009 216 CONAMA, 2006 ; IPCC, 2007b ; Campbell, 2008 ; CEPAL, 2009

72 vulnerabilities to climate change. In combination with this, the availability of water throughout the territory is characterized by strong contrasts varying significantly in space and in time. On the one hand, in several regions precipitations are concentrated almost exclusively in one season, which means that for the majority of the year the availability of water depends on the natural and artificial means to store it; while the El Niño - La Niña oscillation provokes an acute variability in rainfall, alternating cycles of wet periods with others of rainfall below normal that occur every two to seven years. As a consequence of this, water is less available in the northern and central regions, were most of the population inhabits and were the economic activity is concentrated. Droughts are a natural hazard, to which Chile is highly vulnerable, because the associated scarcity of water has significant impacts over the environment and the economy of the country. Droughts are a source of human insecurity because their impacts lessen the livelihood and limit the access to the livelihood resources of the population.

Social sector: human security vulnerabilities Social indicators are relevant in assessing the impacts of natural hazards in the livelihoods and the well-being of people. Livelihood resources are the bases from which individuals or households construct their livelihoods. They are commonly broken into five types: natural (forest, water), economic (income, credit), human (skills, knowledge), social (networks, relationships) and produced (roads, transport, buildings, energy).217 The ability of people to deal with natural hazards is related to their access to these resources. Droughts affect more directly the natural, economic and produced livelihood resources. The magnitude and scale of these impacts depends on the local ecological condition, the productive activities affected and in the type of sources of employment for the population. Generally, rural population is more strongly affected by droughts, because their economic security (income source) and food security (access to food) is closely connected to agricultural production, either as subsistence production, small producers or employees in industrial scale production. There is no single definition of what is rural, or how it should be defined. The National Statistic Institute of Chile (INE, its

217 McLennan and Garvin, 2012:121

73 Spanish acronym) defines rural population as “The residents of localities with less than two thousand inhabitants, in which more than 50% of its economically active population is dedicated to secondary and tertiary activities.”218 According to the latest census (2002), the rural population represents only 13.4% of the total, proportion that is slowly but steadily descending due to urbanization.219 But, as the census shows a continuous decline in rural population, at the same time figures show an increment in employed people in agriculture-related activities. Partly because of these apparently mismatching tendencies, the UNDP uses a ‘wide understanding of rurality’, a notion defined in terms of “The areas where the prevailing economic activity…is related to forestry, agriculture and/or fishing, whether in its immediate condition of activity in the physical space (countryside), or in its mediate forms, link to any of the different parts of the productive chain.”220 According to the UNDP, ‘totally rural’ population adds up to 28% of the total, while ‘part rural and part urban’ amounts to 37%.221 Under this lens, almost one third of the Chilean population is economically related to agricultural, livestock, forestry or fishing activities. This means that for a large proportion of the population their food and income security are tied to the ‘fortunes’ of agriculture. Forestry, agriculture and fishing activities are the main sources of employment in rural areas, hosting 60% of the rural labour force employed in 2006, to which is added a significant contingent of urban workers employed in agriculture.222 Actually, as much as 37% of the income of rural and urban families is linked to agricultural production. In the Central Zone almost 40% of self-employed farmers live in towns or cities. In Chile large farms account for only 2.9% of agricultural producers (businesses), but hold about 55% of productive agricultural land. Whereas farmers engaged in subsistence agriculture and small businesses amount 84.6%, but occupy only 22.6% of the productive agricultural land.223 In this sense, it is important to highlight that of the universe of irrigators over 65% are small farmers, 30% medium

218 INE, 2011b (my translation) 219 INE, 2011a 220 UNDP, 2008 221 Ibid 222 FAO, 2010 223 ODEPA 2005 and COMSA 2008b quoted in Aldunce and González, 2009:12

74 and only 5% are large producers.224 In other words, not only the land, but also water rights are concentrated in few hands.225 Furthermore, little over 40% of farms are smaller than five ha, representing less than 1% of the total agricultural area,226 which indicates that within the small producers there are significant differences too. Their owners exploit the majority of these farms, and if they have labourers, in a high percentage they are close relatives. This is usually referred to as Rural Familiar Agriculture (AFC, its Spanish acronym), which mainly includes families whose household is dependent on areas with low agricultural potential, like dry soil rainfed.227 For families in the AFC category farm revenue has a low contribution in the total household income. For 55% of farmers these revenues represented less than a quarter of their total income, while only for 29% their farm revenues contributed to more than half of the total income.228 Moreover, according to the before mentioned UNDP study, 98% of rural households surveyed receive income in cash, and 88% of them come from outside of the property or home. The UNDP study determines that only 22% of rural households in Chile have production for self-consumption. But when the analysis is limited to smaller groups of people, such as villages and rural communities, the figure rises to 46%.229 In other words, for a considerable part of the rural population subsistence production is key in the household food security. Poor rural population is more vulnerable to droughts, because large producers are linked to foreign markets and have access to credits, water rights and technology, while small producers and those depending on communal lands seldom have access to these palliative resources.230 This situation is more relevant among inhabitants of dry soil rainfed areas, and therefore augments their vulnerability to climatic fluctuations.

Economic vulnerabilities Since the mid 1980s Chile has been undergoing a process of structural and institutional transformation by which a developmental paradigm based on a free market

224 Crespo, 2012 quoted in La Segunda, 2012a 225 For a detail analysis of the legal and institutional framework of water in Chile see pages 86-89. 226 ODEPA, 2009 227 Meza et al., 2010:62-64 228 FAO, 2009 229 UNDP, 2008 230 León and Garay-Flühmann, 2005

75 economy was adopted. Chilean economy is based in the exploitation, and subsequent exportation, of natural resources: mining, forestry and agricultural activities. Currently it has preferential access to over 82% of world markets, due to the many free trade agreements it has signed with the countries of North America, Asia, Oceania, Latin America and the European Union, and because of its memberships in commercial blocks, such as APEC and MERCOSUR. Mining is the country's largest economic sector in terms of its contribution to GDP and exports, and is also a major user of water. Mining production accounts for 51% of the country’s exports, which corresponds to 14% of the GDP. This in turn represents 35% of the industrial uses of water.231 The main problem is that the vast majority of the mining resources are located in the north, where water is naturally scarce and water sources are nearly depleted. In fact, there are no more water rights or concessions to be granted in this area.232 It is estimated that 78% of the cooper production takes place in mines located in basins with deficit (less than 100 mm of rainfall a year).233 For its part, agriculture and forestry accounts for 7% of the country’s exports. Between 1960 and 2007 the agricultural GDP of Chile went from the equivalent of 452 billion pesos to 3,080 billion, both in 2003’s currency. In the decade 1997-2007 Chilean agriculture and the food industry grew at an average annual rate of 5.2%, while the national economy only grew at rates above 4%.234 This growth was mainly driven by the export sector. A figure that help sketch the transformations of the forestry and agriculture sectors, exports increased from US$ 4.5 billion to US$ 11 billion between 1995 and 2007.235 While in 1974 Chile participated with only 6% of the South American exports of fruit (such as table grapes, apples, pears, and peaches), by 1991 it represented more than 47% of the exports and had also diversified its products.236 These major transformations, together with the dependence on commodity exports, have left the Chilean economy exposed to the fluctuations of the world economy. For example, regardless of the 1994-1997 drought (the first one of the 1990s) in the period 1987-1997 the Chilean GDP grew at annual rates above 7%. But 1997 marks the beginning of the Asian financial crisis, to which Chile was not

231 Ayala, 2010 quoted in World Bank, 2011 232 Ibid 233 CEPAL, 2009 234 UNDP, 2008 ; FAO, 2009 235 FAO, 2009 236 León and Garay-Flühmann, 2005

76 immune. Only in 1998 the deficit of trade in goods amounted to US$ 2,500 million, the highest of the 1990s, with a drop in exports of 12% and in imports of 4%. This resulted in a deficit on current account of US$ 4,500 million and a steep decline in the expansion of the GDP, which after growing 7.1% in 1997, fell to 3.4% in 1998.237 The 1998-99 drought hit the economy when it was already in a declining phase of its growth rate, which only contributed to further complicate the fragile situation. According to a report by CEPAL (Spanish acronym for Economic Commission for Latin America and the Caribbean), climate change will have a serious impact on the Chilean economy, because of its effects on hydropower, irrigation and supply of water for consumption. In absolute terms the economic evaluation, within the A2 scenario, varies from US$ 22 billion to US$ 320 billion. These costs imply that Chile stands to lose the equivalent of 1.1% of GDP annually throughout the analysis period –up to 2100– in the A2 scenario.238 Regarding the generation of electricity, CEPAL estimates losses of between 10% and 20%, with an associated economic cost in the range of US$ 100 million per year. The subsequent increase in thermal generation would in turn raise GHG emissions by around 3 million tons of Co2. Similarly, over the next thirty years, climate conditions will reduce water availability in all the basins where mines currently operate, most of which are located in the northern arid and semiarid regions, were it is already scant. Mines will have to desalinize seawater, increasing production costs. In regards of agriculture and forestry sectors, in general terms improvements in agricultural productivity, due to the changes in the agro climatic conditions, are expected in the South Zone and in some areas of the Central Zone. In contrast, in the rest of the country, especially in regions with irrigation restrictions, decreases in productivity and losses are expected.239 While certain species and regions may benefit from climate change, the overall impacts will be negative, with yearly net losses of between US$ 100 million and US$ 300 million in profits. Climate change impacts eventually will affect society as well. Changes in agricultural production would have effects in the structure and demand for labour in rural areas. In the regions of the Central and South zones the rural-urban migration rate

237 CEPAL, 1999 238 By way of reference, the country’s GDP for 2008 was about US$ 120 billion. CEPAL, 2010 239 CEPAL, 2009 ; CONAMA, 2010

77 would increase. At the national level it is expected a decrease in the demand for labour of about five percent.240 These changes in weather patterns have related economic, social and environmental problems, many of which “Will be associated with changes in water resource availability and the resulting effects on hydroelectric power generation, drinking water supply and the use of water for irrigation and other production sector activities.”241 As a point of fact, a report by the World Bank establishes that the national developmental strategy has been far more influential in the current situation of water resources than the dynamics of the water sector itself.242 Chile has a market- oriented economy, based on the exportation of goods with production processes that are water intensive, such as mining, agriculture and forestry products. It is worth noting that in Chile agricultural production accounts for 77% of water usage and the mining industry for over 12% (not considering consumptive uses). In contrast, household consumption is responsible for 5% of water usage.243 In the last fourteen years the water deficit in the northern and central regions has doubled, and is expected to increase by 50% by 2025.244 At the same time, the availability of water is being limited by the decreasing quality in some watersheds. The report states that “As a result of these developments in supply and demand, competition for water will increase, the interdependencies between water users and its associated conflicts will augment, and environmental pressures will intensify.”245 Thus for, I have characterized the environmental and socioeconomic vulnerabilities of Chile to droughts. In what follows, I will address how droughts impact the environmental, social and economic security sectors, by studying the consequences of the 1994-1997 and 1998-1999 droughts.

Impacts of droughts in Chile by security sector

Agriculture and environmental impacts To meet the emergency caused by the national scale drought that affected Chile between 1994 and 1997, the Government established the National Drought

240 CEPAL, 2009 241 CEPAL, 2010:49 (my translation) 242 World Bank, 2011 243 El Mercurio, 2012d 244 El Mercurio, 2012d 245 World Bank, 2011:vii

78 Commission (CNS, its Spanish acronym), whose main purpose was to complement the permanent activity of other governmental departments and offices. During this period eight out of the thirteen regions246 of the country were declared ‘Emergency Areas’. This comprises more than two thirds of the total continental territory and over 80% of the population. All of these regions suffered shortages of fodder and forage that provoked massive losses in caprine, ovine and bovine cattle herding. There was an overall reduction in plantings, crops and yields. For example, in the dry coastal rainfed area of the VIII region there were plantations losses of about five to thirty-five percent. The reduction in the supply of water for irrigation resulted in local conflicts over water distribution. Water for human consumption had to be trucked to several localities around the country. It also caused the outbreak of enteric diseases.247 As determined by the CNS report,248 in regards to the fruit industry there was a reduced vegetative development on the plantations during the 1996-1997 seasons, which also affected the next year’s production due to poor bud induction. There was a greater susceptibility to pests and diseases, a condition that was aggravated with the early harvest of immature fruit. Similarly, there was a significant reduction in the crop yields, while vegetables reduced their production and quality. Forestry production was affected too, because the lack of water slowed the growth of trees, which is more significant in the long term, at the time to harvest the plantations. In the immediacy, the reduced levels of moisture increased the risk of bush fires. In regards to the livestock industry: the reduced availability of fodder in natural grasslands and summer pastures provoked nutritional problems. This increased the animals’ susceptibility to diseases and, as a consequence of the weight loss, resulted in reduction of the prices at the time of sale. Reproductive behaviour was affected, litters lacked uniformity, and there was an increase in natural abortions and deaths of young animals.

The 1997/98 “el Niño” phenomenon and its consequences After four years of water scarcity, the hydro-meteorological year of 1997/98 was defined by an intense El Niño phenomenon. From the III to the IX regions average rainfalls were above normal. Just in the III region, characterized by a semi-desert

246 Then Chile was divided politico-administratively into thirteen regions. In 2007, two more regions were added. See page 60. 247 CNS and IICA, 1998 ; Fernández et al., 1999 ; Norero and Bonilla, 1999 ; Aldunce and González, 2009 248 CNS and IICA, 1998 ; Bonilla, 1999 ; Norero and Bonilla, 1999

79 climate, relative to the statistical average the accumulated rainfall skyrocketed to 500% and 1000% in certain areas.249 The torrential rains of 1997 caused several episodes of flooding and landslides throughout the country, which left an overall death toll of thirty, 51,000 people evacuated, over 100,000 people were isolated –in different areas of the country and for different periods–. Economic losses were estimated at US$ 30 million.250 One of the problems with these sudden torrential rains is that they eroded the soil, an effect that was further accentuated by the degradation that had previously been suffered as a product of the previous years of drought. Erosion in Chile is considered an extreme event. Currently 34.5 million ha are affected by it. The main problem of erosion is that it involves the dragging of sediment into rivers, where they are deposited and become jammed, which during high rainfall makes rivers leave their courses (beds). As explained by Gayoso and Gayoso “Most of the water for human consumption are taken from the water courses, so the drag of sediment affects water quality parameters such as turbidity and pH, it increases organic and chemical material, affecting the cost of purification and the health of the population”.251 Furthermore, this increased sedimentation affects the efficiency of canals, ponds and irrigation systems, reservoirs for power generation, among others. And if the rivers leave their beds, they end up affecting not just agricultural and energy related, but all sorts of infrastructures. The 1997 rain left considerable damages to public infrastructure, roads, potable water supply, and agricultural irrigation. For example, in the IV region alone eighty percent of secondary and tertiary roads were left practically unusable. As it might be deduced, the main users of these roads are small producers and poor rural families. The intensity of El Niño led the authorities to declare the drought, and the different emergency states associated, terminated. Actually the CNS ceased its functions in 1997, and thus its reports cover de period 1994-1997. However, the El Niño of that year proved to be short-lived. As the saying says back home “A rain does not make a diluvium”, and a second hydrological drought, the hardest of the twentieth century, hit the country the following year.

249 Bonilla, 1999 250 Gayoso and Gayoso, 2005 ; Aldunce and González, 2009 251 Gayoso and Gayoso, 2005:6 (my translation)

80 1998/99 Drought impacts That year La Niña presented itself with such intensity that 1998 was the driest year of the century. The dry coastal rainfed area underwent an 80% deficit in rainfall, compared to a normal year. The affluents of the biggest water reservoir carried 65% less water than in a normal year and 35% less than in 1968/69, up until then the driest on record. The area affected by the 1998/99 drought corresponds to the regions V to VIII, comprising an area of 60,000 ha of mainly rainfed crops, farms, orchards, vineyards and rainfed cattle herding. For example, in regards to wheat production, as of October 1998 the losses reached 30,000 ha of wheat, and in the livestock industry losses rose up to US$ 31.5 million.252 Although there are no studies that systematize the types, levels of damages and economic losses caused by droughts, the records show that for Chile losses in agriculture, on average, could amount up to US$ 450 million per year.253 According to the CNS the 1994-1997 drought losses amounted to US$ 250 million a year in agricultural and livestock production.254 Only in 1996, the drought caused revenue losses of US$ 203 thousands in the fruit export industry. The overall impact provoked a contraction of the agricultural sector of 2,1% (not including fishing and forestry), when it was expected to have a real growth of 4% to 5%. There were generalized declines in the planted areas and productivity. As a consequence of the reductions in crop yields, Chile had to increase its imports in over 20%, particularly of wheat, to cover the domestic supply deficit caused by the drought.255 The overall economic impact on agriculture can be traced through the agricultural GDP. According to INE in the period 1993-1997 it grew at a yearly rate of 5,9%. However, in 1996 this figure expanded a meagre 1,31%. The 1998/99 La Niña was even more detrimental, not only because it was the worst drought of the century, but because its impacts were compounded with the cumulative effects of the previous drought, the damages to the agricultural infrastructure of the 1997 floods and, on top all of the above, the worldwide economic slowdown consequence of the Asian financial crisis. In 1999 the Chilean agricultural GDP actually contracted -0,78%, and the yearly average growth for the 1998-2002 period was reduced to 4,1%.256

252 SNA 1998, quoted in Aldunce and González, 2009 253 Alfaro (no year) quoted in Meza et al., 2010:30 254 CNS and IICA, 1998 255 FAO, 1998 ; Donoso et al., 1999 ; Aldunce and González, 2009 256 INE, 2009

81 These environmental and economic impacts, such as reduced productivity, crops and livestock losses, and the subsequent decline in overall agricultural activity, among others, all have a correlation in the social sector. As is shown below, they significantly affect the source of income and of food for the rural population, who are already in a fragile social and human situation. This in turns forces the authorities to implement programs and measures to partly alleviate some of the negative effects.

Social impacts of droughts The National Drought Commission (CNS) established by the government had a palliative character, complementing permanent activity of other departments and offices. According to the CNS report, small farmers were the most affected by the 1994-97 drought. Added to the significant losses of crops and livestock, was the unemployment among seasonal agricultural workers. Moreover, the rural population had problems accessing water for personal consumption and hygiene.257 The actions enacted by the CNS were channelled through four major programs, ought to either increase the livelihoods of the people affected or to provide or facilitate their access to livelihood resources.258 Drinkable Water consisted mainly in the distribution of water in trucks and provision of drums and storage tanks. It reached 534 rural localities, in seven regions, benefiting more than 115 thousand families. Irrigation Improvement consisted of water catchment projects from springs and wells, using pumps and accumulating water in tanks to distribute it by hoses to irrigate farms, and repairing and building channels for irrigation. Over 200 km. of channels were built or repaired, which facilitated the irrigation of more than 38 thousand ha, benefiting over 37 thousand families and generating 29 thousand temporary jobs. Livestock consisted in animal deparasitation and vitaminization programs, together with the distribution of bundles of grass for feeding. More than 1 million animals were dewormed and over 350 thousand bundles distributed. Forestry consisted in the reforestation of more than 3 thousands ha, generating 1.5 thousands temporary jobs that benefited over 25 thousand families. In addition to these, two complementary programs were enacted. The Human Nutrition in Regions III, IV and V consisted in the distribution of food rations were in rural schools, benefiting almost 14 thousand poverty stricken students. As it names

257 CNS and IICA, 1998 ; Norero and Bonilla, 1999 258 CNS and IICA, 1998

82 suggest, the Encouragement of Precipitation program, in Regions IV and V, intended to stimulate rainfall by bombarding clouds. As is possible to see, the majority of the actions and programs enacted by the CNS can be framed within the human security narrative, which is consistent with a framing of water scarcity as a source of human insecurity. The CNS acted out as an assistance program when delivering drinking water to several communities and distributing food rations for schools and fodder provisions for livestock. For those in the lowest income deciles, direct governmental monetary subsidies259 represented 30.1% of the total monetary income of households.260 As stated by the report “The actions of the CNS avoided a serious social problem, due to the reduction in the incomes of the affected farmers and prevented the migration of the rural population into areas that had, at least, drinking water.”261 A recent pilot study conducted by FAO attempted to determine the current vulnerability of Chile to droughts, studying the impacts of recent droughts. It focused on two rainfed semi-arid regions: Combarbalá, located at the feet of the Andes in the IV Region and eight municipalities of the dry soil rainfed areas of the VI region. These were chosen, firstly, because dry soil rainfed areas are the first and most strongly affected by a drought. Secondly, because their inhabitants have their households’ income tightly linked to agricultural related activities.262 Overall 94,6% of the producers declared a reduction of their water supply. Of the families whose principal sources of water are wells, 80% were seriously impacted and 25% had problems accessing potable water. According to this study, regardless of the amount of their losses, 72,9% of people who declared to have been affected by the latest droughts are located in the lower income levels (less than US$ 600 a month). This means that 18,6% of the farmers affected had to look for an alternative source of income (second job) to alleviate the crisis. The most economically affected were those involved in livestock farming and cattle herding: 91.9% had problems feeding their animals and 17.4% had problems related to livestock diseases, of which 60.4% also reported deaths of animals. Of the population engaged in livestock and cattle herding, 49.6% are families that are in the lower income range.263

259 Which may include social pensions, child benefit subsidy, and potable water subsidy, among others. 260 FAO, 2010 261 CNS and IICA, 1998:19 262 Meza et al., 2010:57-83 263 Ibid

83 Regardless if it is irrigated or rainfed agriculture, it has been observed that during droughts farmers tends to plant fewer specimens and prune their trees to restrict production, and thus facilitate their survival. These types of agricultural adjustments, together with the loss of crops, translate into a decrease in the overall productivity that affects the employment. In spite the fact that the agricultural sector consumes more than 90% of the available water in the northern and central regions (I to VII), as we will see in the next section, it is generally the one with the lowest priority in water shortage scenarios.264

Impacts of the current drought (2010 - ) As stated earlier, one of the main problems of studying droughts is the lack of standardized, universally accepted methods to measure and quantify their impacts. This is particularly true for the ongoing drought that is affecting Chile, of which the only information available is that published by the local press. For this reasons the following account is more of a general sketch of the current situation, rather than a detailed analysis. For the same reason, it is not disaggregated in security sectors either. Up until February 2012, more than 110 municipalities in the country were declared to be in agricultural emergencies. It is estimated that the rural population affected reaches more than 172 thousand people, out of which for over 157 thousand their only access to drinkable water is through tank trucks provided by the local government.265 The lack of rainfall has also dried grass all over the country, which not only reduces its direct availability as a food source for animals, but also diminishes its nutritive quality too. This has affected livestock, sheep, ovine and caprine, producers, throughout the country, as well as small rural communities for whom they also constitute a relevant source of food. Local authorities have had to provide forage for animals, together with trucking water for the population. In addition, this has also affected milk production, which in recent months has fallen by 4.7% in the country.266 The V region is one of the most affected, where thirty-six out of the thirty-eight municipalities are declared agricultural emergency zones. This region registers a lack of precipitation since 2007, which is why local authorities speak about a structural

264 Norero and Bonilla, 1999 265 El Mercurio, 2012b 266 El Mercurio, 2012e

84 drought. The most important river in this region, Aconcagua,267 carries less than half of its average flow and the wells in the region are in a six-year minimum. To illustrate the dire situation, Quillota, a small town dedicated to the production of avocados, loses between US$ 200 and US$ 300 million for each year of drought.268 In the northern regions the water deficit is registered for the seventh consecutive year. The lack of rain has dropped reservoir levels to less than 30% of their capacity. The impact on the local fruit industry could mean a decline in exports of US$ 300 and US$ 500 million, in respect of the US$ 3,600 million exported in 2011. One of the factors explaining the current water shortages is that in the last decade the arable land in several basins has increased, and with it the population. Along with this, mining companies have increased their extraction processes. From a hydrological point of view, the current drought is comparable to other historical droughts. The difference is that the current demand for water is much higher and it cannot be satisfied with the available sources.269 For example, although the flow of rivers Teno, Maule and Mataquito (VII region) increased in 2011 compared to the 2010 season, due to rainfall and snow accumulation, the volumes cannot satisfy the demand for production needs. It is worth to highlight that during the last quinquennium the Metropolitan Region has recorded the driest period in a century. Between 2008-2012 the total amount of precipitations was 1,198 mm, which is significantly lower than the 1,617 registered during the quinquennium 1993-1997, which covers the drought impacts studied before.270

Strategic sector

While for analytical purposes it is necessary to break down the study of security impacts in different sectors, in practical terms these sectors are interwoven, making it impossible to address all the variables involved in a problem without crossing ‘sectorial’ boundaries. Previously I have specified the amount of crops lost (environmental and economic sector), these losses were also quantified in monetary terms (economic sector) and in job losses (social and economic sectors). However, the connections between security sectors cannot be reduced solely to different, complementary mechanisms to quantify gains or losses. There are certain problems in

267 Aconcagua is one of the rivers expected to be highly affected by climate change. See pages 69-70. 268 El Mercurio, 2012e 269 Matta, 2012 quoted in Ibid 270 El Mercurio, 2012g

85 which a series of variables and competing interests converge, that require a comprehensive analytical approach. Water-related problems give a window of opportunity for such an analysis, because water systems are so physically interconnected, and its resources can be used for such divers purposes, that water uses inevitably have effects on third parties. In the particular case of Chile, a country in which hydroelectricity is a major component of the energy grid, the relation between water and energy becomes a key element to understand the overall security implications of water scarcity. The impacts of droughts on energy security are relevant for both, human and state security, ant thus the study of the 1998/99 electricity crisis illustrates how droughts impact these two dimensions of security simultaneously. Chile is a paradigmatic case of the implementation of neoliberal law and policies, which is reflected in the water and electricity sectors. Several authors have analysed the laws and institutional frameworks that govern both sectors, and its political, economic and social effects of these market-based mechanisms.271 I will first highlight the most relevant characteristics of these laws and institutional frameworks, and then explain the drought/electricity crisis.

Water and electricity institutional framework The Water Code defines water as national asset of public use, whose domain belongs to the nation and its use to all its inhabitants. However, it grants the right to use and exploitation of water resources to privates. The entity responsible for constituting water rights, resolving disputes and in general control and plan the use of these resources is the Water Directorate (DGA), which depends of the Ministry of Public Works (MOP). This agency grants new rights free of charge whenever water is physically and legally available. If there is only one applicant for any given water right, as long as water is available, legal formalities are comply and it does not impair the rights of others, DGA has no discretion to deny such requests. In the case of competing applications (two or more applicants), or if there is not enough water to satisfy simultaneous applications, the DGA must hold a public auction and sell the new rights to the highest bidder. Rights-holders pay no taxes or fees for acquiring rights

271 For the case of water law see: Bauer, 1993 ; Dourojeanni and Berríos, 1996 ; Peña, 1997 ; Bauer, 1998 ; Dourojeanni and Jouravlev, 1999 ; Francke, 2002 ; Salazar, 2003 ; Matus et al., 2004 ; Larraín and Schaeffer, 2012 For the case of electricity law and energy sector see: Fisher and Galetovic, 2001 ; Castillo and Maldonado, 2004 ; Maldonado and Palma, 2004 ; CNE, 2008 ; Bauer, 2009 ; Prieto and Bauer, 2012

86 from the state or for keeping them over time. However, DGA can neither cancel nor restrict water rights once granted or recognized, except by expropriating and paying for them. Furthermore, rights-holders can freely change the location and use of water rights without administrative approval by the DGA.272 Once constituted, all water rights are governed by private or civil law rather than public or administrative law. Consistent with the principle of developing market incentives, the grant of water rights is considerer real property and holders can legally dispose of it freely. As point of fact, article 24 of the Chilean Constitution states “The rights of privates over water, recognized or constituted in conformity to the law, give its holders the property over them.”273 In practice this means that the Constitution and the Water Code treats water as an economic good, in which the main regulatory instruments is the water market. It reduces the role of the State in water management to a set of regulation and incentives, leaving the allocation of resources to market forces and mechanisms. The State establishes demand-side subsidies for the weaker sectors of society, in order to keep market distortions to a minimum.274 It is important to highlight that the right over water is the only property right in Chile that is given freely, perpetually and without any class of demand. There are neither charges nor a specific tax for the use of water. From a legal perspective water is natural resource subject to be marketable as any other commodity. One of the main limitations of this market-based approach to natural resources management is that basins management is not integrated and responsibilities of resource allocation and management are separated in a way that does not correspond to their physical characteristics and their optimal use. Although surface water and groundwater are usually part of an integrated hydro-geological system, the two are handled separately and there are serious deficiencies and gaps in the regulation of groundwater management.275 For example, the Water Code misses to regulate the basins minimums flow, which has lead to the depletion of rivers and reservoirs in arid regions, and has triggered conflicts between downstream users (irrigation for agriculture) and upstream users (hydroelectricity generation).276

272 Bauer, 1998 ; Dourojeanni and Jouravlev, 1999 ; Matus et al., 2004 273 Constitución Política de Chile, 1980 quoted in Dourojeanni and Jouravlev, 1999:10 274 Peña, 1997 The economic and social effects on agriculture of these subsidies, and how they improve human security, have been studied for one Chilean Province. See León and Garay-Flühmann, 2005 275 Dourojeanni and Jouravlev, 1999 276 Bauer, 1998 ; Madaleno and Gurovich, 2007 ; Larraín and Schaeffer, 2012

87 As in the case of water, the electric law of 1982 is part of a policy of economic and social development that conceives market-based mechanisms as a central axis, ensuring the efficient allocation of resources through the promotion of competition. Until 1980 electrical systems in Chile were state owned and firms were vertically integrated and subject to rate of return regulation. The new electric law established a system that favours private investment and free competition, in which the State has a subsidiary role. A price system was introduced and generation was decentralized and separated from transmission and distribution. In addition, it was established a new regulatory agency with a ministerial rank, the National Energy Commission (CNE, its Spanish acronym),277 and state-owned generation companies (gencos) were privatized during the 1980s and 1990s.278 Energy generation was no longer considered a public service, so power companies were not obligated to obtain concessions from the government. The electric law allows the installation of any power station whenever the interested party wishes and without the requirement for any special previous administrative authorization. This freedom was also sustained by the fact that state planning of new electricity projects is non-binding and is based on projects presented by private companies, which are not obligated to carry them out.279 One of the purposes of establishing free competition in the generation sector was to reduce political or corporate influences, and thus achieve economic efficiency. However, from an institutional point of view, both the water code and the electric law embody institutional preferences that facilitate the instalment and makes hydropower cheaper than other power sources. For example, hydropower developers can access privileges such as the rights to enter private or public land in order to study the viability of a project, and to flood other people’s land for the construction of reservoirs, even against the will of the proprietors. Furthermore, the electric law explicitly says that hydropower stations can be freely installed without special public approval (Article 4).280 This helps explaining why hydroelectricity has been the backbone of the Chilean energy strategy.281

277 In 2009 the Ministry of Energy was created and CNE is one of the organisms that depends on it. 278 Fisher and Galetovic, 2001 279 Prieto and Bauer, 2012 280 Ibid:140 281 For more on this see Chapter 3, pages 124-128.

88 It needs to be underscore that hydroelectric generation affects other water uses, like irrigation, sanitation and residential and industrial consumption. However, the economic costs of downstream externalities are not considered when calculating the costs of hydropower generation. In this sense the Chilean legal and institutional framework not only gives preferences to hydro generation, but has also proved inadequate to resolve emerging conflicts among competing uses.282 This directly and indirectly impacts people’s livelihoods. For example, in Chile legislation has ignored indigenous customary law and practices when establishing regulatory mechanisms and management of water resources.283

Structural energy vulnerabilities The Chilean energy matrix consists of four interconnected systems independent of each other, according to the geography of the country: Interconnected System of the Great North (SING, its Spanish acronym), Interconnected Central System (SIC, its Spanish acronym), the Electric System of Aysén and the Electric System of Magallanes. Because of its size and coverage the most important is SIC. It encompasses eleven out of the fifteen politico-administrative regions of the country; it has almost three quarters of the nationwide installed capacity and serves little less than 90% of the population. By 1990 more than 90% of the installed capacity of the SIC was hydropower. One of the critical problems of energy generation is that there is currently no technology to store electricity on a large scale, with the exception of water in hydropower. Reservoirs can function as batteries, since generating stations can generate power by releasing water downhill.284 This is why dams with reservoir storage are exceptionally strategic for energy security. SIC system has five reservoirs, Rapel, Invernada, Colbún, Chapo and Laja. Out of these, the largest and most significant reservoir of the power grid is Laja Lake. It is the only one with an inter-annual capacity, accounts for about 80% of the water storage capacity of the country, and feds several hydro plants.285 The water management of

282 Dourojeanni and Berríos, 1996 ; Peña, 1997 ; Matus et al., 2004 ; Madaleno and Gurovich, 2007 ; Bauer, 2009 ; Larraín and Schaeffer, 2012 ; Prieto and Bauer, 2012 283 Madaleno and Gurovich, 2007:364 284 Bauer, 2009:606 285 Castillo and Maldonado, 2004

89 Laja Lake articulates the price system of the spot market.286 The amount of water is measured by its height in meters above the sea level: the lake is full when it is at 1,368 m., whereas it is empty when the elevation reaches 1,310 m. In 1999, in a year with average hydrology hydroelectric plants supplied almost 80% of the energy demanded in the SIC system. In a wet year, 100% of the energy could have been supplied by hydropower. In contrast, in a very dry year, such as 1998/99, hydro generation provided less than 40% of the total demand. That is, “In a very dry year about half of the normally available hydraulic energy disappears.”287 As a result of the 1994-1997 drought Laja reserves were almost exhausted by mid 1997. The El Niño event of 1997/98 partly alleviated the situation and by January 1998 levels reached 1,330 m., one third of its capacity. Despite the shortage of reserves, during the first half of 1998 most of the energy generation in SIC was based on hydro plants. By June Laja levels dropped to 1,316 m. It was almost empty.

The electricity crisis In November 1998 the first of a series of power outages in the most severe crisis of electricity supply in Chile occurred. The immediate cause was the sudden failure of a natural gas power plant. But reaching such a fragile situation that the failure of one plant could bring down the entire system was the result of the three interwoven reasons: the decline in hydroelectric generation due to the drought that affected the country those years; the prevalence of short-term corporate business strategies and political criteria that depleted the scant water reserves; and the failure of thermal power stations that were supposed to operate as backup units for hydro generation. The ecological conditions were the worst imaginable. The hydrological year of 1998/99 was the driest of the twentieth century. The cumulative effects of the 1994- 1997 drought left the dams of the hydroelectric plants at exceptionally low levels. In addition, there was less accumulation of snow in the Andes, thus there was less water available during the thaw (October through March). A fact that illustrates how dependant the power grid was on hydrological conditions, and how severe the 1998/99 drought was, is that according to the information provided by the Centre for Economic

286 In the Chilean electric system three markets interact that attend to generators, distributors and users. The spot is the instant exchange market, where energy and power generators trade at the spot price. More technical information in Chumacero et al., 2000 ; Díaz et al., 2000 ; Fisher and Galetovic, 2001 and in the webpage of the Chilean Energy Commission www.cne.cl 287 Díaz et al., 2000:7 (my translation)

90 Load Dispatch of the Interconnected Central System (CDEC, its Spanish acronym),288 if the tributaries that fed the SIC reservoirs would have had equal levels as in 1968/69, –up until then the worst drought on record– rationing would not have been necessary, even considering the failure of thermal plants.289 Given the above situation, since mid 1998 there was sufficient information to assume a scenario of constraints in hydro generation, at least until the next rainy season (April 1999). In addition, during the first half of 1998 there was enough capacity in the thermoelectric park to cover the gap in generation supply. Nevertheless, in this period hydro plants were used at full capacity.290 To put this in context, during July and August of 1998 hydro generation displaced up to 65 GWh that could have been produced with thermal plants, whereas the November outages were caused by energy deficits of 76 GWh.291 In other words, hydropower was most used when it was less needed. This is a sign that the main problem was not the lack of water reserves in itself, but the compounded effect of political and economic/corporate decisions that depleted the waters at earlier stages of the drought.

Political implications The government postponed the enactment of unpopular precautionary measures and only acted after the outages began. For example, the CDEC predicted a deficit in July 1998, but the energy authorities did not issue a rationing decree, that would have given room for less life-altering alternatives, like voltage reductions. In September the National Energy Commission recommended issuing a rationing decree, but the government ignored it. Furthermore, between December 1998 and March 1999, a period when there is usually a decrease in demand due to the summer holidays, and seasonal thaws increase the availability of water, the government pushed the CDEC not to decree restrictions. Only in late February the authorities decided to lower the voltage.292

288 CDEC is a quasi-private organization whose function is to coordinate power generation and demand, deciding which power plants enter into operation in order to match supply and demand at all times. To ensure that the electrical system operates at the minimum cost, it sorts them from lowest to highest operating cost, and generation stations enter the system according to the lowest possible operating cost at any given time. The first ones to enter are run-off stations, followed by reservoir-fed hydro plants and then thermal stations. More details in Galetovic et al., 2004:64-69; Prieto and Bauer, 2012:138-141 289 Bernstein, 1999 290 Rozas, 1999 ; Díaz et al., 2000 ; Fisher and Galetovic, 2001 291 Díaz et al., 2000 ; Fisher and Galetovic, 2001:13-14 292 Rozas, 1999 ; Díaz et al., 2000

91 Moreover, in July 1998 the largest generation company (genco) in Chile, Endesa, informed the authorities that the country was on the verge of a power failure and thus the first rationing of the 1990s. To avoid it, Endesa requested the early delivery of 500 million m3 of water from Laja and Maule reservoirs that were originally earmark for agricultural irrigation.293 MOP used the risk of outages as an argument to approve this delivery. As determined by the law, MOP requested the opinion of the CNE and a report assessing the situation to the CDEC. Both agreed to deliver 200 million m3, under the condition that Endesa extract half of the amount in July and the other half in August.294 This precautionary measure intended to assure that thermal energy was used at full capacity while the hydrological drought lasted. The terms of the final agreement were not made public, but given that Endesa used its hydro plants at full capacity during July and August, it appears that it was given free hand. By September 1998 the elevation of Laja Lake dropped to 1,310 m. It was empty. As summarized by Rozas: “Regardless of the windfall that Endesa would obtain by exploiting water resources, that were national assets for public use, the bottom line is that there was misuse of water reserves in extreme.”295 Despite the fact that water reserves and energy generation are strategic assets for any nation-state, their management is not independent from political pressures or corporate interests, and Chile is not an exception. This is illustrated in the misuse of the resources of Laja lake during the 19998/99 drought crisis, since the management of the country’s most important reservoir “…was strongly affected by political and governance mechanisms that were complex and out of the public eye.”296 Probably, it will never be known what the reasons were that the government had to transfer the water reserves to Endesa when the hydrological situation was so precarious, or to postpone the enactment of rationing decrees until it was no longer possible. However, there are political factors that cannot be ignored. In the parliamentary election of 1997 the governing coalition lost the majority that it held in the Senate, though it kept the majority in the House of

293 The Maule reservoir has capacity for 1,500 million m3. When the volume is larger than 670 million m3 Colbún, a hydro generator, can use the water freely. When the level is lower than 170 million m3, all water is reserved for agricultural irrigation. In the intermediate range use for generation requires authorization by MOP. More details in Rozas, 1999 ; Fisher and Galetovic, 2001 294 Rozas, 1999 295 Ibid:18 (my translation) 296 Bauer, 2009:635

92 Representatives.297 In that election for the first time in Chilean history null and blank votes added more than 17% of the total, which was interpreted at the time as a punishment to the whole political class, but particularly to the government. In addition, the most reputed political survey of the country showed signs of growing discontent and rejection of the government. In June 1998 the rejection levels reached 40% and one year later they escalated to 44%.298 When asked about the reasons of the current bad situation of the country, 55% of the answers attributed to the mismanagement of the government’s domestic economic policies. Given that electricity rationing is a very unpopular measure, it seems reasonable to assume that in order to avoid further deterioration of its public support, especially considering that in 1999 there were presidential elections, the government was betting on the weather conditions to improve enough to avoid the power cuts. Probably it was never in its estimations that they were facing the worst drought of the century. Moreover, as a result of an unlikely series of events, by the end of 1998 the spot market had no official price, mainly a consequence of the actions of gencos.299 According to the current legislation, the Ministry of Economy had a four-month limit to resolve this situation. Considering that the minister took the whole four months to reach a decision, and that its wording did not settle the dispute completely, “It seems reasonable to think that the delays and the ambiguity in the verdict were caused by lobbying pressures.”300 It is worth highlighting that as a consequence of the ‘peculiarities’ of the regulatory system, none of the gencos involved paid compensations of any significance for the power cuts. Energy generation in Chile is intrinsically vulnerable because it is highly exposed to hydrological conditions. The drought-electricity crisis revealed flaws in Chile’s legal and regulatory framework that increase energy insecurity. The de facto pre-eminence of corporate interests over State’s interests, and the lack of effective mechanisms to discourage irresponsible behaviour (gencos paying fines for blackouts) show the deficiencies of the regulatory system to deal with situations that, while having low probability of occurrence, when they do occur they considerably affect the livelihood of the population and seriously lessen the overall capabilities of the country.

297 The results of the elections are available in www.servel.cl 298 CEP, 1999 299 A detailed explanation of this situation and its consequences can be found in Díaz et al., 2000 ; Fisher and Galetovic, 2001 300 Fisher and Galetovic, 2001:15 (my translation)

93 Economic losses associated with the power outages There is no agreement on which is the most accurate or effective way to calculate the economic and social costs of electric power outages. Galetovic estimates that, valued at an efficient cost, the 1998-1999 energy rationings amounted between US$ 22 and US$ 26 millions, currency value of 1999. If calculated at the cost of failure,301 this figure rises to US$ 95 millions. These amounts only consider the rationing made, not the cuts suffered or their associated costs.302 On the other hand, Chumacero et al. estimates that the costs of the rationings itself, calculated only to regulated clients – residential and small industries, which represents 40% of total consumption–, depending on the demand vary from US$ 10.3 to US$ 21.4 millions a month.303 To these economic losses, it is necessary to add the indirect effects of power outages. Several press reports indicated that there was a general decrease in industrial production, as an outage of two to four hours can cripple the operations of companies with continuous production processes.304 At that time authorities and business representatives estimated economic losses –vaguely, it must be added– in “Thousands of dollars.” Small and medium sized businesses had to extend working hours with the subsequent payment of overtime wages. Public departments and service sector businesses, such as banks, saw their ability to serve costumers reduced, which affected both users and companies alike. The first power cuts that occurred without warning provoked damage in some industrial machinery. In food-related industries the crisis caused the proliferation of self-generation equipment, to continue operations and avoid further losses. As the crisis deepened, hydroelectric generation was replaced by thermal generation (gas, fuel oil, coal), which has a higher cost of production and is significantly more polluting. This partly explains the slower economic growth. As explained by Rozas:

301 As explained by Rozas (1999:33) in those years “The cost of failure was defined as the price of the last kWh produced by the system. When there is a deficit, that cost rises in the first tranche of failure to 15.6 cents per kWh, in the second, to 18.6 cents, and the third, to 25.6 cents, amounts that strongly outweigh the costs of water generation (1.9 cents) and combined cycle gas (2.06 cents). In the spot market, the cost per kWh before issuing the rationing decree was at 6.5 cents. Consequently, the application of failure cost to the price of energy in the first stage of failure (up to 10% deficit) would mean an increase of 2.5 times the amount of the previously prevailing price in the spot market and just over 7.5 times the value of the cost of hydroelectric generation” (my translation). 302 Galetovic, 2005 303 Chumacero et al., 2000 304 Press reports quoted in Rozas, 1999 ; Maldonado and Palma, 2004

94 The energy sector, including gas and water, represents two points of the Chilean global GDP. Consequently, if the energy GDP falls by 20% in a month, it causes a decrease in the total product of 0.4 points. If the calculation considers the two-hour cuts made between 11th and 24th of November, the sector shows a fall of 10%, implying a decrease in the monthly product of -0.2 points.305 As illustrated above, water has a key role in the energy security of Chile, because on the one hand is the least costly energy source of the power grid, which makes it more beneficial from a social and economic perspective. But more significantly, given the strong hydropower component of the energy matrix, in wet periods hydroelectricity leaves the country in a condition of relative energy autonomy. Consequently, in Chile the internal security implications of droughts, and their associated water scarcity, have a human security dimension, because they alter the livelihood of the population, particularly rural people, affecting their economic, food and health security. In addition to this, the impacts of droughts on energy generation indirectly augment human insecurity, since blackouts alter the livelihoods of the population and energy shocks have effects on employment, inflation and economic growth. Together with this, due to the strong positive correlation between energy and economic growth,306 from a security of the State dimension energy generation and supply constitute a key element of the security of any nation-state. Energy drives economic activity, involves the exploitation of natural resources and entails the well- being of its population. Droughts alter the normal functioning of the country and limit the policy options of the authorities. All of these impacts are located at the environmental, social, economic and strategic sectors, and at the unit and subunit level. Energy generation is a source of strategic vulnerability in Chile, because the energy matrix is a major hydropower component, and thus energy security and autonomy depends on hydrological conditions, which are intrinsically variable. As expose in the next chapter, this strategic vulnerability in turn affects the Regional Security Complex of Chile.

305 Rozas, 1999:70 306 Sharma, 2010

95

96

Chapter 3: External Security Implications of water scarcity

Given the ubiquity of water and its intrinsic strategic value, environmental security scholars have generally hypothesized that the scarcity of water, that is when the resources available cannot meet the demand, is a source of potential interstate and intrastate violent conflict. However, available evidence shows that water has not triggered conflicts. Rather it has been used, in a context of violence, as an instrument to gain leverage in a conflict. In this sense, the Transboundary Freshwater Dispute Database (TFDD) project established that while the biophysical and socioeconomic vulnerabilities are significant aspects, they are not sufficient by themselves to lead to acute conflict. It is the geopolitical situation that determines if an event becomes a source of conflict or cooperation. As established in the previous chapter, the scarcity of water in Chile is a pressing problem with many aspects to it. The current developmental paradigm, based on constant socioeconomic growth, persistently increases the demand for water. But given the biophysical conditions of the country, together with the ongoing global climate change, scientific research predicts that the current and future relative availability of water (supply) is most likely going to decrease. As a consequence of the composition of the energy matrix, Chile is energy independent only in wet years. In dry periods it depends on thermal energy, like coal or gas, which leaves the country exposed to external factors and actors. For example, after the drought-energy crisis of 1998-1999, the first effort to diversify the matrix was through the importation of natural gas from Argentina. Of the three neighbouring countries it is the one with which Chile shares the longest border (is the second longest in the world) and the only one with whom it has not been at war.307 But just as thermal generation took a relevant role in energy generation, a political and economic crisis in Argentina lead their authorities to violate the treaties and commitments made, which resulted in gas outages that set off a new energy crisis in Chile in 2004, known as the Argentinean gas crisis. This example illustrates the scope and the mechanisms through

307 Though in 1978 there was a severe crisis between both countries, over control and sovereignty over three small islands in the Beagle Channel, which was within hours of becoming a war.

97 which the scarcity of water affects security in Chile: it is not water itself, but its associated energy implications. When the hydrologic conditions cannot meet the energy demands, it loses part of its autonomy as it is exposed to exogenous forces, augmenting the strategic vulnerability of the country. As will be shown in this chapter, the neighbouring country with which Chile has the most contentious and complex relationship, Bolivia, has abundant hydrocarbon resources and is using them, in the context of the energy needs of Chile, as a bargaining chip in a long-standing bilateral territorial dispute. This is why the geopolitical situation is relevant in understanding the overall security implications of the scarcity of water, and why drought impacts in Chile have a human and a state security dimension. Energy insecurity has an effect on the regional security complex (RSC), and thus drought security impacts can also be found in the strategic and political sectors, and at the unit and the subsystem levels. The present chapter is structured as follows: firstly I will address the most relevant characteristics of the regional security complex of South America, and particularly those of the security complex of Chile. Then I will address the relationship between Chile and Bolivia, showing how throughout history issues that are not in themselves part of the security realm have been securitized, determining the bilateral relation. Afterwards I will address the Argentinean gas crisis, to finally summarize the current energy situation of Chile.

South American Regional Security Complex

Buzan and Wæver define the South American RSC as “Something of a puzzle.”308 For example, although there are more than fourteen unresolved conflicts (ten territorial disputes and four disputes regarding transboundary basins), involving seventeen of the twenty-five countries of the region,309 Latin America is one of the most peaceful regions in the world.310 According to the Stockholm International Peace Research Institute (SIPRI), between 1990 and 2000 the region witnessed four armed conflicts, compared to sixteen in Africa, nine in Asia, nine in the Middle East and eight in Europe.311

308 Buzan and Wæver, 2003:305 309 Fuentes, 2008 310 Contreras, 1999 ; Buzan and Wæver, 2003:304-340; Domínguez et al., 2003 311 SIPRI defines an armed conflic as the violent use of military force between two or more actors with a result of 1000 or more death whi it lasts. Quoted in Sotomayor, 2008

98 This relatively peaceful environment is partly explained by a widespread diplomatic culture and in the advanced and expanse of regional institutions.312 Throughout history Latin American countries have tended to settle their disputes by either diplomatic means, legal and judicial approaches, or a mixture of both. However, the same inter-American institutions and diplomatic culture that promotes regional peace, also generates what Domínguez, et al. define as a moral hazard: States can behave recklessly, militarizing disputes to serve domestic political objectives, certain that international agents will intervene to stop the fighting before the situation escalates to war. States can also stubbornly resist making compromises over boundary disputes, equally certain that undesired outcomes would not be imposed on them. The common thread is that an international public good—international institutions and procedures—provides a kind of insurance that frees state actors from some of the prudential constraints ordinarily imposed by interstate competition.313 Arguably, this moral hazard fosters a volatile kind of regional peace. Although the risk of large-scale armed confrontations is minimum, because regional institutions would prevent them from happening, it is not possible to rule out conflicts either. Latent controversies derived from both historical territorial disputes and from new security threats, such as drug and light weapons traffic or human trafficking, are a source of constant tensions in South America. As framed by Fuentes: “The main problem in regional relations is that a traditional security agenda, that is relations with outstanding border disputes, overlaps with a security agenda with non-traditional threats. The combined effect of these two agendas sets an unfavourable stage for advancing in the solution of potential conflicts.”314 Currently Chile is involved in border disputes with all of its three neighbours. Perú took Chile to The Hague Court in a dispute over the delimitation of the maritime border between the two countries. Chile and Argentina have overlapping territorial claims over Antarctica, and have yet to demarcate a section of their southern border that runs through the Patagonian ice fields.315 However, the most complex issues are held with Bolivia. Ever since becoming landlocked after a war against Chile, it has

312 Herz, 2011 313 Domínguez et al., 2003:14 314 Fuentes, 2008:12 315 The only large source of fresh water in the world outside the polar circles.

99 persistently demanded a sovereign access to the Pacific. Now, following the example of Perú, it intends to take this claim to The Hague Court. In addition to this territorial dispute, and intermeshed with their maritime aspiration, Chile and Bolivia have unresolved disputes regarding the sovereignty and usage of waters of two shared transboundary basins. Both these basins, besides their strategic value, have historic, and symbolic importance of their own. In addition, issues such as drug trafficking or stolen vehicle trafficking are intermeshed with this traditional agenda. For example, in June 2011 the Chilean police arrested a group of fourteen Bolivian army personnel, who were found 270 km. inside Chilean territory, carrying arms, in two stolen Chilean vehicles. At their arrival to Bolivia, after being deported, President Evo Morales honoured and promoted them “For their role in the fight against smuggling.”316 While trafficking or smuggling issues are beyond the scope of this thesis, this incident illustrates the degree to which these two security agendas are intertwined in the region, and particularly in the bilateral relationship between Chile and Bolivia.

The security complex of Chile: La Guerra del Pacífico The history of relations between Chile and its neighbours, Argentina, Bolivia and Perú, is long and complex. For example, Chile gained its definitive independence from the Spanish crown in 1818 with the military assistance of Argentina. These two countries organized the libertarian army and gave economic support for the independence of Perú in 1823. A decade late, between 1836 and 1839, the Peruvian- Bolivian confederation fought parallel wars against Chile and Argentina over economic, territorial and political disputes.317 Of all the different episodes, the most emblematic milestone, the factor that defined territorial borders and determined history, shaping the structure of the security sub-complex is La Guerra del Pacífico (The War of the Pacific), also known in Anglo-Saxon literature as the Nitrate War. Between 1879 and 1883 Chile fought a (second) war against the Peruvian- Bolivian entente, which resulted in major transformations of the borders of the countries involved. The strategic issue that triggered the conflict was the secret defensive pact signed by Perú and Bolivia in the 1870s. The economic issue was the control of the nitrate industry in Antofagasta and Atacama regions that prior to the war

316 Morales, 2011 quoted in Radio Cooperativa, 2011 (my translation) 317 Collier and Sater, 2004:63-69

100 belonged to Bolivia, but were exploited mainly by Chilean capitals and workers.318 In 1880 Bolivia withdrew from the theatre of war, implicitly resigning to its coastal territories. The year after Chile reached Lima, the capital of Perú, and occupied the city for four years. Chile emerged as the winner of the conflict and peace was negotiated independently, in 1904 with Bolivia and in 1929 with Perú. These treaties settle on the final borders and legally put formal and diplomatic end to the war, with only remaining minor compensations and payments of additional settings.319 In 1879, in the middle of the war for the northern border, Argentina approached Chile with territorial claims over Patagonia. After a series of diplomatic encounters, Chile ended up ceding to most of Argentina’s demands and the border was settled through the line of the highest peaks that divide waters in the Andes. As a result, almost the whole South American southern cone, that used to be shared between both countries and where most of the hydrocarbon resources are located, is now part of Argentina. Whilst Chile lost a significant part of its (colonial) southern territories,320 it was favoured by the redefinition of borders after the War of the Pacific. Its northern frontier was extended at the expense of the Bolivian coastal territory and of the southernmost region of Perú, Arica and the Azapa valley.

Chile-Bolivia: a relationship of rivalry and enmity The most defining outcome of the treaty signed between Chile and Bolivia is that the latter lost its sovereign access to the Pacific. Bolivia is the South American country that has suffered the largest territorial losses, a product of negotiations, wars and arbitrations. Although some of these are larger than those against Chile, it is specifically with the scission of the Department of the Coast and losing sovereign access to the ocean, with which they express greater feelings of shame and retaliation.321 As stated by Mila Francisco, “In the Bolivian collective imaginarium that loss is felt larger than other territorial losses. Because of its symbolic image as a qualitative dismemberment, the War of the Pacific came to represent the war of wars and the cradle of distrust against Chile.”322

318 Ibid:125-144; Wehner, 2010 319 Hernández and Ebensperger, 2010 320 When de American colonies became independent, the territories of the new states were defined with the uti posidetis juris principle, by which the same territorial boundaries of the administration of the Spanish crown were used to define the borders. 321 Francisco, 2009 ; Wehner, 2010 322 Francisco, 2009:47 (my translation)

101 In Bolivia’s social imaginarium their material underdevelopment is attributed to the loss of their “maritime quality”: their consequent landlocked condition deprived them of having their own ports to build up foreign trade and to project themselves in the international arena.323 Regardless of the validity of the argument, this is how the outcomes of the conflict are articulated, which partly explains the resentment towards Chile. As asserted by Wehner “Bolivia’s maritime aspiration still plays a strong role in determining the way both countries construct their images of the other. Despite the fact that these two countries have not had a military incident since 1884, they still conceive of each other according to a pattern of rivalry.324 Losing the war, and thereby the access to the Pacific, has shaped Bolivia’s national identity and the maritime issue has become a ‘national cause’. Former Bolivian president Carlos Mesa explains the feeling of Bolivians on the war and Chile: The sea became the main element of spiritual cohesion for the country…the historical defeat is the big element of unity. …Our kids have been educated under two premises: hate Chile, and maintain the imperative goal of recovering access to the sea. The non-rational and permanent conclusion in Bolivians’ hearts is that Chile is the enemy, all that is Chilean is bad for Bolivia, and that Chile has never lost its appetite for taking away Bolivia’s territory and wealth.325 As it will be developed later, the landlocked condition and the ‘national maritime aspiration’ have been fundamental elements in Bolivian foreign policy, in general, and in its bilateral relation with Chile, in particular. The relevance of this issue is epitomized in the words of the former Bolivian Foreign Affairs Minister, Antonio Araníbar: “The reintegration of the maritime quality, lost in the War of the Pacific, is the main objective of the foreign policy and essential objective of the Bolivian nation.”326

The “Peruvian” factor In 1929 Chile and Perú signed the Treaty of Peace and Friendship that defined the boundaries and restored diplomatic relations between them. There were two cities in dispute, Tacna and Arica, which were divided equanimously: the former was given

323 Colacrai, 2008 ; Francisco, 2009 ; Wehner, 2010 324 Wehner, 2010 325 Mesa 2008:242 quoted in Ibid:13 326 Araníbar, 1999:50 quoted in Francisco, 2009:48 (my translation)

102 to Perú, the latter to Chile. They now constitute the respective southern and northern borders. But more importantly, this treaty also contains a clause specifying that no parties could unilaterally give a piece of or the entire territory covered in the agreement to a third party without the consent of the other. Given that the territories that Bolivia lost ended under Chilean sovereignty, this treaty gave Perú a veiled veto power over any eventual territorial arrangement between Chile and Bolivia.327 Therefore the peace treaty between Chile and Perú had two determining consequences. In practice it reaffirmed the landlocked condition of Bolivia, and by giving both countries veto power, it transformed Perú in an indispensable player in the Chile-Bolivia bilateral relation.328 Ever since these treaties were signed, regaining access to the sea has been a key issue in Bolivia’s foreign policy, and Perú has known how to exploit that at its own convenience. As an example of the above-mentioned trilateral situation, throughout the history of the Chilean-Bolivian relations there have been different attempts to solve the ‘maritime issue’. A variety of approaches have been tried, ranging from negotiating a sovereign corridor, the proposal of enclaves with sovereignty or transforming Arica in a trilateral city, among others.329 The most important of these efforts is known as The Embrace of Charaña: an initial agreement signed in 1975 by the military presidents Augusto Pinochet of Chile and Hugo Bánzer of Bolivia, which proposed territorial swaps that include transferring to Bolivia a sovereign strip of land north of Arica. In return, Chile would receive a surface equivalent to the relinquished area. When consulted, Perú did not answer directly on their acceptance or rejection of the Charaña negotiations. Instead it proposed internationalizing the port of Arica, requested the establishment of other rights in the city, and to share sovereignty with Bolivia and Chile over a sector between the Pan-American Highway and the coast. Chile rejected these propositions, because under the Treaty of 1929 Perú was only entitled to give or withhold consent, not to suggest amendments.330 As a result the negotiations failed and both parties withdrew. Even though the proposal of Perú was a covert veto, Bolivia has always blamed Chile for the failure, arguing that refusing Peruvian proposals was

327 Collier and Sater, 2004 ; Wehner, 2010 328 This is comprised in the local saying: “one country holds the key, the other the lock”. 329 Francisco, 2009 ; Hernández and Ebensperger, 2010 330 Hernández and Ebensperger, 2010

103 proof of the lack of honest intention to negotiate.331 Chile has always rejected this interpretation. The maritime issue was not solved. Border disputes and patterns of rivalry and competition characterized the relations of Chile with its three neighbours. In addition to this tense geopolitical situation, and as a consequence of it, in regional relationships there is also a tendency to securitize disputes or strategic resources, to use them as leverage in bilateral controversies. The RSCT is a useful analytical tool to capture the systemic impacts and mutual influences between the scarcity of water (non-traditional security issue) and the outstanding territorial disputes (traditional threat), the securitization tendencies and the balance of power behaviours of regional relations (traditional security agenda).

Hydropolitics on a hot border

The territories annexed by Chile after the War of the Pacific correspond to the Great North Zone. This area is home to a significant part of the Chilean mining resources, and to one of the most hostile places in the world, the Atacama Desert. Located between the Pacific Ocean and the Central Andes, in the Altiplano region, is characterized by high-altitude desert plateaus and the acute scarceness of water. Precipitations are concentrated in a single season, summer, and only in the Andean areas located above 4,000 meters above the sea level (masl.). There is a total absence of rainfall in the interior desert and in the coastal plains.332 Indeed, there are meteorological stations in which not a single drop of rain has fallen since recordkeeping began.333 It is so dramatically arid that it is too dry even for microbial life, which is why NASA defines it as “The most Mars-like environment on Earth.”334 Whilst Atacama offers poor conditions for life, as we know it, it is plentiful in mineral resources, which have been vital throughout the history of Chile. The exploitation of the nitrate mines fuelled and was the sustenance of the national economy during the late nineteenth century and early twentieth century, until the development of synthetic nitrate during World War I. Currently the lithium extracted from its salt-lakes accounts for 43% of the worlds production. But most relevant, in this desert the worlds biggest open pit copper mine is located, Chuquicamata, exploited by the state-owned company Codelco. The latter is the largest copper producing

331 Dossier submitted by the Bolivan government to the Hague court, quoted in La Tercera, 2011 332 IAP, 2008 333 Vesilind, 2003 334 NASA, 2002

104 company in the world and contributes almost a third to the Chilean government’s income.335 In the Great North two relatively small transboundary basins are located, the Lauca River and the Silala River, which are two of the worlds most politically conflicted.

The Río Lauca dispute The Lauca Basin is located in the north-eastern part of the Chilean Altiplano, close to the border with Perú and Bolivia (Figure 4). Lauca is a transboundary river that has a total extension of 225 km. Its headwaters are in Cotacotani Lake, at 4,400 masl. It flows for 75 km. in Chilean territory and then crosses the border to Bolivia, at about 3850 masl. After 150 km. the river empties into Coipasa Lake (3,700 masl.).336 Altitude, temperatures, natural erosion and other environmental factors, has made life flourish under extreme conditions in this basin. For example, the average annual precipitation is 380mm, whereas the annual potential evaporation is 1500mm.337 Lauca has a pluvial regime in which heavy summer rains provoke its major flows. The river has some twenty-one tributaries in Chile, of which only nine are of any importance. It has many more in Bolivia. On the Chilean side there are twenty-nine villages and hamlets, which according to the 1992 census have a total population of 181. Among these settlements stand the villages of Chucuyo and Choquelimpie, with seventy-five and twenty-one inhabitants respectively. The river basin covers 235 thousand ha, of which only 303 ha have some sort of agricultural use, mainly for growing vegetables and forage for animals.338 In 1939 Chile declared its intention to divert the waters of Río Lauca into the Azapa Valley, for irrigation and hydroelectric generation. Before this, in Bolivia the waters of Lauca were used only for supplemental irrigation for subsistence agriculture.339 Chile announced the project in 1939 but began the feasibility studies in 1948. The following year Bolivia took part in a Mixed Commission appointed to study the Chilean project. The results, endorsed by a joint report delivered by the end of 1949, were favourable to Chile. Thus, in December the latter informed that it would

335 Mulligan and Eckstein, 2011 336 Department of State, 1966:4; Glassner, 1970 ; DGA, 2004 337 López, 2008 338 DGA, 2004 339 Tomasek, 1967:353; Glassner, 1970:193

105 continue with its plans. Bolivia did not reply. The construction of the dams began in 1953. In 1959, after a series of diplomatic notes, a second mixed technical commission was constituted. The report, submitted in September 1960, approved the project and disallowed the objections of Bolivia.340

Figure 4: Map of Lauca and Silala basins

Source: Adapted from Transboundary Freshwater Dispute Database

When Bolivia learned in 1961 that the dams were being tested, it declared that Chile was legally prohibited from diverting the Lauca waters without its consent.341

340 This is a brief summary of a long history. For a more detailed account see Glassner, 1970 341 Tomasek, 1967

106 Chile argued that it had previously given its tacit approval when it did not reply. After an endless exchange of diplomatic notes, the 14th of April 1962 Chile diverted the waters. In response, Bolivia sent a formal note to the Organization of American States (OAS) in which these actions were defined as “a threat to (its) territorial integrity” and as an “imminent geographical aggression”.342 Together with requesting an urgent special meeting of the OAS Council, Bolivia broke diplomatic relations with Chile. The latter responded in kind. Since then official relations have not been restored. During April and May of 1962 the Council of the OAS discussed the dispute. Its resolution avoided any major binding decisions, and with its wording open to interpretation both countries were urged to solve it through the means of the Pact of Bogotá. This pact covers from good offices and mediation to arbitration and adjudication.343 Bolivia opted for a mediation process, suggesting the governments of Brazil, Costa Rica, Ecuador, Uruguay and Venezuela as mediators. Chile, in turn, rejected this political procedure, on the basis that the nature of the dispute was legal and juridical, and accordingly it would only submit the issue to either the International Court of Justice or to a legal arbitration.344 The Bolivian ‘political’ approach, in contrast with the Chilean ‘legal’ one, is more than just a difference of strategies. These apparently diverse schemes also reveal the non-declared intentions and interests of both parties. For the Chilean government the diversion of the water was, basically, a development project aimed at benefiting the 100 thousand inhabitants (in 1962) of the Azapa valley and the local economy. Accordingly, the differences arousing from the water usages between the two riparian states should be dealt within a bilateral, legal-economic framework. Bolivia, on the other hand, claimed that the problem was legal only until Chile transformed it into a political one when it unilaterally began to divert the waters. In Bolivia this act was articulated as more than just a transgression of their rights, but as an aggression over their interests, one more in a series of aggressions throughout history. These actions are better understood by taking into account the ‘moral hazard’ component of the state behaviour in Latin America, together with the fact that in the region there is a non-traditional security agenda that overlaps with a traditional agenda. Bolivia had openly declared its intention to use any means possible to recover a

342 Quoted in Glassner, 1970:197 343 The role of the OAS has been questioned, particularly in Bolivia, throughout history. For a critical review of this matter see Tomasek, 1967 344 Ibid:353-355; Glassner, 1970

107 sovereign access to the Pacific. Thus, when they opted for the most severe courses of action in international politics, break diplomatic relations, and in parallel bring the Lauca River dispute to the Council of the OAS, Bolivia dimmed any possible violent outcome of its bilateral actions. By including the most relevant pan-regional institution, it also tried to shift the matter from a bilateral to a multilateral scenario, together with using the platform OAS gave to harness international support for its cause. The subsequent option for an international mediation process, intended to shift the problem from the legal to the political sphere. With this double operation, from bilateral to multilateral and from legal to political, Bolivia aimed to link the Lauca dispute to their maritime aspiration, and thus turn a non-traditional security issue into leverage in a traditional security issue, their maritime claim. In point of fact, the Chilean government argued that Bolivia was not concerned for the potential damages derived from the diversion of the waters of Lauca –until now it has not really been exploited–, rather it was using it as a diplomatic instrument to gain access to the Pacific. Whereas it is impossible to utterly dismiss the legitimate concern of Bolivia, their immovable refusal to seek a solution of a legal nature makes room for speculation. As one commentator notes, “The correspondence and statements between the two countries on Lauca River are so complicated that one is left with the impression that Bolivia had at least as good a legal case as Chile. This again raises the question of why Bolivia did not seek a legal settlement.”345 While they were pronounced in 1964, two years after the OAS Council proceedings, the words of the Bolivian Foreign Minister of that time help to substantiate the stance of Chile: “With the consummation of the Río Lauca incident by Chile, our patriotic obligation, naturally, is to defend the Lauca, since it is an instrument of negotiation for the seaport question, and to insist continuously in all forms upon a solution for our port problem.”346 The Lauca dispute illustrates that the ‘national maritime aspiration’ of Bolivia is more than just rhetoric, but an overarching force of its foreign policy. Nonetheless, the Lauca dispute is not the only transboundary issue that Bolivia has tried to use as leverage in its cause for an outlet to the sea.

345 Tomasek, 1967:358 346 Fellman, 1964, quoted in Glassner, 1970:201

108 The Silala River dispute The Silala Basin (figure 4) lies in the Atacama Desert approximately 300 km northeast of Antofagasta, Chile. Its headwaters are high altitude wetlands (4,500 masl.), formed by groundwater springs in Bolivia. A series of small man-made channels direct the flow towards two central drainage channels, the north and south canals, which later join to form the principal canal. This runs nearly 700 m in Bolivia and then crosses the border into Chilean territory. It flows for 7 km to its confluence with the Helado River, where the two form the San Pedro de Inacaliri River, a tributary of the Loa River.347 The historic-symbolic significance of Silala River is that it became an international basin after the War of the Pacific. Prior to the conflict it was completely in Bolivian territory.348 In 1908 the Department of Potosí, Bolivia, gave a concession to the Antofagasta & Bolivia Railway Co. (FCAB) –today Ferrocarril Antofagasta-Bolivia–, to use the waters of the Silala to power their steam-engine locomotives. FCAB replaced its steam locomotives with diesel engines in 1961, and hence transferred the use of the waters to the State of Chile.349 In 1997 the Bolivian government revoked the concession, arguing that the Silala waters were used for purposes different than the original. In parallel, Bolivian authorities announced that they would charge Chile for the use of the waters, and requested the retroactive payment for the four decades in which Chile had unilaterally usufruct the resources of Silala.350 Despite bilateral negotiations held between 2006 and 2009, in which a pre-agreement was drafted, political considerations on both sides prevented the dispute from being solved. Since the concession was revoked, Bolivian authorities have escalated the bilateral level of tensions. In 2000 the Bolivian government awarded the concession of the Silala to a local firm, DUCTEC, which in turn tried to charge Codelco and FCAB for their use of the waters. Two years later the then acting President, Jorge Quiroga, publicly warned that Bolivia might stop the flow of the water to Chile, together with seeking an international arbitration process (again an action with possible violent outcomes is diffused by including third parties). In 2006, President Morales

347 Loa River is the longest in Chile and the only exoreic (allowing outflow) basin in the Atacama Desert. 348 Toromoreno, 2000 ; Mulligan and Eckstein, 2011 349 Toromoreno, 2000 350 Actually a Bolivian Union of farm workers requested a retroactive payment starting in 1908. ADN Radio, 2009

109 inaugurated a military advance post in the Silala outskirts and announced a plan to bottle the water and sell it with the slogan “Drink Silala water for sovereignty”.351 The Silala waters are strategic for Chile, because they are a major source of potable water in the II Region of Antofagasta, and because Codelco uses them in the exploitation of the Chuquicamata mine. Nowadays the only Bolivian users of the waters of the Silala are the seven soldiers (in January 2010) of the advance military post. The nearest Bolivian community is located approximately 70 km southeast of its headwater, and their inhabitants do not use the waters of the Silala. In fact a community leader dismissed the possibility of using the Silala for agricultural purposes, and at the time pressured their government to reach an agreement with Chile, given that this would bring them economic benefits.352 The UNEP highlights that one of the most complex aspects of this dispute is that not even its condition as an international basin has been settled.353 Bolivia’s official standpoint is that the Silala is not an international river, firstly, because is not a river, but a series of canalized springs that have their origin in Bolivian territory. Secondly, it is only because of the works done by the FCAB concession, that they cross the international border. On the other hand, Chile argues that the Silala is indeed a river, and an international one because the canals are not diverted, but follow a natural flow to form the Silala River. On this basis, Chile asserts its rights for an equitable and reasonable utilization of the resources.354 According to a Bolivian official source quoted in Mulligan and Eckstein, the south and north channels, and the principal canal are man-made. Geological, topographical, and historical evidence suggests that the Silala Springs flowed overland from Bolivia to Chile prior to the canalization, and that these canals were made “To make more efficient, but not to alter, the natural course of the waters, which naturally and inexorably flow to Chile.”355 The fact that not even the condition of river of Silala is settled between the two ‘riparians’ is key to understanding why the dispute has not been solved yet. As a matter of fact, the reason why Chile stalled the signature of the 2009 agreement is that, due to internal political pressures, Bolivia wanted to include an article that established their ownership of the watershed. Chile considers the Silala a transboundary basin to which it has the same

351 Mulligan and Eckstein, 2011:598-599 352 Ibid 353 UNEP, 2007 354 Ibid 355 Alvarez, 2010 quoted in Mulligan and Eckstein, 2011:596

110 rights as any riparian, and consequently is not willing to give away sovereignty. The agreement has not been signed yet. Matters are further complicated by the declared intention of Bolivia to link the Silala dispute with their maritime aspiration, when taking Chile to The Hague Court. Furthermore, President Morales has already announced that he is personally going to attend the court when Bolivia makes its presentation in 2012.

Chile, Bolivia and the Hydropolitical Security Complex As defined in the analytical framework, a Hydropolitical Security Complex (HSC) is a special form of Security Complex in which regional actors, with relations governed by patterns of enmity and competition, share one or more river basins of such a strategic value that this water body becomes a major national security issue. All the aspects that increase vulnerability in a river basin are present in the Lauca River and Silala River disputes (Table 6). Both basins are in a desert, drought prone region, highly eroded, in which global climate change will intensify these geo-climatic environmental conditions. Chile has a higher level of socioeconomic development than Bolivia and has ongoing major development projects. There is total absence of institutional capacity. Not even formal diplomatic relations have been (re)established. As a consequence of the above, and together with historical reasons, the bilateral relation is marked by patterns of enmity, rivalry and competition.

Table 6: Aspects of a transboundary basin that increase vulnerability - Rapid environmental change. Aspects that - Rapid population growth or asymmetric economic growth. - Major unilateral development projects. increase - The absence of institutional capacity. vulnerability - Generally hostile relations. - Natural climatic variability —naturally variable rainfall, frequent periods of floods and drought. Source: UNEP, 2007

The disputes between Chile and Bolivia over the usages and sovereignty of the Lauca and Silala basins match most of the criteria of an HSC. They are both shared bodies of water with relevant strategic importance, and the relation between riparian’s is governed by patterns of enmity and competition. But what differentiates this particular HSC is that the dependence on these basins, and subsequently their significance and strategic value, is asymmetrical. In the case of Chile, Lauca is used for hydropower generation, agricultural irrigation and freshwater consumption in the

111 Azapa valley and the city of Arica. Is worth noting that Azapa is an agricultural oasis in a desert, highly eroded region. For example, its olive production for exportation is a major element for the local economy.356 Arica, in turn, has a special symbolic-strategic significance for two reasons. It became Chilean after the war, and is the most used exit point of Bolivian exportations, due to the preferential conditions obtained as compensation for its territorial loss after the war. Silala basin is in a similar situation. It has a strong socioeconomic significance, as it is the source of fresh water for the population of Antofagasta. But more importantly, it has a key strategic significance, as the Silala waters are used for the industrial process in Chuquicamata mine. In contrast, the waters of Lauca and Silala do not have substantial uses in Bolivia. They are a supplementary source of water for human consumption and irrigation for subsistence agriculture for a few local herders. They are not relevant for the local/regional economy or for any particular village or community. However, they do have a strong symbolic significance. The dispute over the Lauca river lead Bolivia to break diplomatic relations with Chile, and the Silala only became a transboundary basin after the War of the Pacific. Bolivia securitized these disputes when it decided to use them as diplomatic and political instruments of its wider foreign policy to regain an outlet to the Pacific. It needs to be underscored that the ‘national maritime aspiration’ of Bolivia constitutes a threat to the security of Chile, as it can only be satisfied at the expense of Chilean sovereignty and territorial integrity. Therefore, when Bolivia links Lauca and Silala to its maritime aspiration, more than a bilateral dispute, a source of insecurity or a strategic security issue, they become a (traditional) security threat. The origin of both transboundary disputes was the use of a scant natural resource, vital for subsistence and economic development, in a region conditioned by extreme environmental conditions. But they escalate into international conflicts not because of the biophysical or socioeconomic conditions, but as a consequence of institutional capacity in these basins –or the lack of it–, as a result of the local and regional political dynamics. As established by the TFDD project, water fosters cooperation more often than conflict in transboundary basins.357 Nonetheless, the TFDD results also establish that the institutional capacity within a basin and the general patterns of relations between riparian states are better indicators of conflict or cooperation. Given the complex and tense relations between Bolivia and Chile, is not difficult to understand

356 López, 2008 357 See pages 34-37

112 why the UNEP declared the Silala basin the most hydropolitically vulnerable in the world.358 The last incidents in this relation ascertain two relevant questions: first, the current patterns of mistrust and rivalry that determine the bilateral relations. Second, the permanent use by Bolivia of the Silala waters as leverage to regain an outlet to the Pacific. In November 2012 the government of Potosí reported its intention to use up to fifty percent359 of the waters of Silala in a fish farm and a bottling factory projects, which will be operating in 2013 and 2014 respectively.360 The Chilean Foreign Affairs Ministry has repeatedly requested information regarding these projects,361 but the Bolivian Government has replied that it will not provide it, because the Silala waters are born on its territory, and consequently its exerting its sovereign right over this natural resource. As framed by President Morales: “I want the Government of Chile to know that we will not inform, nor give account, of why we exert sovereignty in the Potosí Department by exploiting the Silala Waters.”362 When these projects were announced, the Secretary of Agricultural Development of the Government of Potosí, Raul Mendizábal, declared: “Chile needs to worry, because the governor (of Potosí), Felix Gonzáles, intends to use up to a 100% of the Silala waters.”363 In this respect, in the context of the commemoration of the 186th anniversary of the establishment of the Navy, President Morales stated “Chile is wrong if aims to take this case to international courts, because the Government and the Armed Forces of Bolivia know where the works are being done.”364 Furthermore, it also declared “(Chilean) President Piñera can easily solve the maritime issue…it only depends on a political decision for the two countries to work in complementarity. They know they need us. We know, and I know perfectly well the military strategy of their Armed Forces.”365 The significance of this statement, “They know they need us”, is going to be fully understand in the next section, when is analysed the Bolivian gas diplomacy and the instrumentalization of their hydrocarbon resources.

358 UNEP, 2007 359 Some press articles mention forty percent. 360 La Razón, 2012 361 La Tercera, 2012a 362 Morales, 2012 quoted in La Segunda, 2012b (my translation) 363 Mendizábal, 2012 quoted in La Razón, 2012 (my translation) 364 Morales, 2012 quoted in La Segunda, 2012b 365 Ibid

113 In addition to the above, few days after these projects were announced, the governor of Potosí, Felix Gonzáles, declared the intention to divert the waters of Silala to feed Colorada lagoon, which due to droughts and “…to the problem of climate change is not raining in the region and it could dry out.”366 These two related Bolivian projects on the Silala basin and the reactions on both sides of the border demonstrate, first, the relevance of both the physical conditions and the institutional capacity in transboundary basins, and how these variables mutually affect each other. Because water is scant resources acquires greater strategic weight; and because bilateral relations are governed by patterns of enmity, it becomes a source of conflict in itself, and a factor that augment previous conflicts. But most important, this episode demonstrates that water scarcity is a relevant problem in this region, and that it can and is indeed use as a geopolitical instrument in regional relations. This becomes more significant when considering the asymmetry in the dependence that both countries have on the transboundary basins, and in the strategic value/purpose that they give to them. Because of how (differently) these disputes have been articulated on both sides, they have intensified the historical, underlying patterns of competition, enmity and mistrust. But more important, this asymmetry gives Bolivia leverage in its bilateral relation with Chile. This is particularly significant, in the context of the energy needs of Chile, for two intertwined reasons. Firstly, as a result of its dependence on hydroelectricity, in periods of water scarcity Chile depends on external sources to satisfy its energy needs. Secondly, as shown below, Bolivia is using its hydrocarbon resources as a bargain chip for a sovereign access to the Pacific.

Energy (in)security

“Gas por mar”: Bolivian gas diplomacy In his inaugural address upon assuming the presidency of Bolivia, in August 2001, Jorge Quiroga declared: More than twelve decades ago in a border dispute Bolivians lost territory and our access to the Pacific Ocean. More than six decades ago, in another border dispute, we defended our borders to preserve the Bolivian territory that has more than 80% of our gas reserves. Today…we gravitate back over the Pacific. The gas is and will be our best

366 Gonzáles, 2012 quoted in Radio Cooperativa, 2012

114 ambassador, our foreign minister and our best representative in the XXI century.367 Indeed Bolivia has the potential to become one of the key players in the energy development of South America, and is using it as a foreign policy instrument. Bolivia has the second largest natural gas reserves in the region, after Venezuela, which at current rates of production should last for almost fifty years.368 Although natural gas is currently its largest export, Bolivia is only the sixth producer of the region. According to figures from the Bolivian Foreign Trade Institute, in 2010 natural gas yielded an income of US$ 2,700 million.369 Bolivia has a privileged geostrategic position. Right in the centre of the South American continent, it shares borders with Argentina, Brazil, Chile, Paraguay and Perú. Because of its location and its reserves, it is a crucial actor in any initiatives of energy integration in a region that craves for resources to power its socioeconomic development. Considering this and the fact that its internal energy market is relatively small, partly because 74% of the population is rural and 22% of the urban population has no access to electricity,370 Bolivia has a wide margin to expand its domestic and external markets. In 2001 the concessionaries of the Margarita gas field in the Department of Tarija formed a consortium, Pacific LNG, to export Liquefied Natural Gas (LNG) to the US and Mexico. The project involved building a pipeline and port facilities to transport natural gas from southern Bolivia to the Pacific coast. At the time the investments were estimated at over US$ 5 billion, of which US$ 1,8 billion would have been invested exclusively in Bolivia.371 The government calculated that the project would yield revenues of some US$ 3,1 billion per year.372 There were two possible exits to export the gas: the Chilean port of Patillos and the Peruvian port of Ilo. Because of its proximity and the conditions of the terrain, Pacific LNG had preferred the former. The Peruvian option increased the costs of the pipeline in little over US$ 600 million.373 The governments of Chile and Bolivia negotiated in the strictest reserve the feasibility of exporting gas to and through Chile. But as soon as they were made

367 Quoted in Orías, 2002:151 (my translation) 368 OLADE, 2010 369 Quoted in BBC, 2011 370 Pérez Le-Fort and Chacón, 2006 371 Rudnick et al., 2007 372 Assies, 2004:5 373 Rudnick et al., 2007

115 public, the talks spawned bitter rejections. Bolivian civil society saw them as an act of treason on the part of their government. People went out to the streets and rapidly popular mobilizations turned into violent protests, which were equally repressed by the police and the army. With a toll of more than sixty people dead, the government lost all credibility and support, the social and political unrest became untenable and President Sánchez de Lozada had to resign. Who until then was vice president, Carlos Mesa, took office in October 2003. One of Mesa’s first measures as head of the government was to convene a binding referendum on the issue of gas exploitation and exportation, to decide whether hydrocarbon resources should be nationalized and whether they should be used as a bargaining chip to negotiate an outlet to the sea. Little over ninety-two percent of the population supported the idea of nationalizing hydrocarbon resources, and almost fifty- five percent supported the proposed strategy to use natural gas “As a strategic agent to regain a sovereign access to the Pacific.”374 Since then the strategy known as “gas por mar” (gas in exchange for sea), by which Bolivia will only sell natural gas if Chile agrees to a cession of sovereign access to the sea, has been quintessential in Bolivia’s diplomatic bilateral and multilateral efforts to go back to the Pacific.375 In the past Bolivia has used its landlocked condition as an argument in commercial negotiations with Argentina to obtain further trade benefits, such as free- trade zones.376 Nowadays it uses its energy resources as leverage in its relation with Chile, not just in its bilateral dimension, but also in the other spheres of its foreign policy. In 2006 Bolivia and Argentina signed an energy exchange agreement, which contained a specific clause that forbids the latter to redirect “A single molecule of Bolivian gas to Chile.”377 This clause is more than just a commercial whim, it is a clear illustration of Bolivia’s broader foreign policy of using any means, be they commercial treaties, diplomatic initiatives or international forums, to build a case and gain support to recover access to the Pacific. As stated by former Bolivian Ambassador Armando Loayza, “Gas diplomacy becomes the centrepiece of a comprehensive economic, geopolitical and diplomatic strategy to invigorate and revive our action and international projection in this new century.”378 For Bolivia, natural gas is not only its

374 Available in Bolivia.com, 2004 (my translation) 375 America Economica, 2004 ; Wehner, 2010 376 Colacrai, 2008:66 377 Bolpress, 2006 378 Loayza, 2002 quoted in Orías, 2002: 167-168

116 engine for economic development but, more importantly, it is an instrument of foreign policy to seek in the international arena the fulfilment of their maritime national goal. A different insight over the gas controversy is given by Colacrai, whose analysis attempt to determine the influence of identity factors in the foreign policy and international behaviour of nation-states. In her view, the formula sea-gas exchange contains in its terms the two factors that, in each case, strongly contribute to the design of their identities. That is, the Bolivian aspiration of a sovereign access to the sea is a goal that entails a “Way of being and a way of understanding their foreign policy.” While for Chile, if we take into account the present construction of an identity rooted in the vision of a commercialist-State, “Not to have such strategic energy resources to fuel its own economic growth leaves the country in a situation of great vulnerability.”379 The strategy gas por mar illustrates the overlap of a traditional security agenda with a non-traditional one. In the southern cone sub-complex it is a common practice for the actors of the region to securitize either non-traditional disputes or natural resources, in order to gain leverage in bilateral disputes, or in the RSC. This is why despite the relative peaceful environment, escalating quarrels and discords are conforming elements of the South American RSC. Gas por mar also brings to light how water scarcity affects the strategic security of Chile: in dry periods Chile is not energy autonomous, condition that can and is being exploited by other regional actors.

Future sources of problems As it has been seen the ‘national maritime aspiration’ is fundamental in Bolivian foreign policy, in general, and in its bilateral diplomatic relationship with Chile in particular. But the current Bolivian administration has taken this ‘institutional’ national cause to a ‘constitutional’ level. Upon assuming, the first elected President of aboriginal origin, Evo Morales, promoted the formation of a Constitutional Assembly. The resulting Constitution, promulgated in 2009, in its fourth chapter, article 267, states: “The Bolivian government declares its inalienable and indefeasible right over the territory that gives access to the Pacific Ocean and its maritime space.”380 It also defines as an “indispensable” objective the solution to the maritime dispute through peaceful means and the full exercise of sovereignty over that territory. Furthermore,

379 Colacrai, 2008:68 (my translation) 380 Bolivian Constitution, 2009 (my translation)

117 within its transitional articles –which expire in 2013–, specifically article 9 states: “International treaties prior to the Constitution, that do not contradict it, will remain in the legal system, with legal rank. Within four years since the election of the new executive organ, this will denounce and, if necessary, will renegotiate the treaties that are contrary to the Constitution.”381 The new Constitution expressly claims the Bolivian ‘right’ to an access to the Pacific and the ‘full’ exercise of sovereignty in that territory. This is not new in Bolivian diplomatic rhetoric. But in the Peace Treaty that Chile and Bolivia signed in 1904, the latter renounces to their sovereignty over the coastal departments. The new constitutional dispositions technically oblige the authorities to ‘renegotiate’ the terms of the bilateral agreement, which is certainly an unseen element in the history of the dispute. This not only directly violates the letter and the spirit the 1904 treaty, but it also contradicts one of the guiding principles of international law: that international treaties cannot be unilaterally ignored. Since the deadline is not met yet, the effects of these provisions are still to be seen. Nonetheless, the Morales administration and the House of Representatives have recently defined a common course of action to tackle the issue of the maritime claim “As a constitutional mandate in all international events”.382 The President of the House of Representatives explained it as “A unique vision, a single mandate of all members of parliament...so that this claim is presented before international organizations, over the outstanding debt of Chile and inalienable Bolivian right to demand access to the sea.”383 In this line the vice Secretary of Foreign Affairs of Bolivia announced the decision to establish rules of procedure for the members of parliament to promote a single speech over Bolivian foreign policy at international forums. As a matter of fact Bolivian authorities are not going to lack opportunities to implement this new approach as 2012 is going to be a highly tense year in regional diplomacy. As mentioned earlier, Bolivia intends to take the Silala dispute upon The Hague Court, and link it to their maritime aspiration. In addition, in 2012 the yearly general meeting of the OAS Council is going to be held in Cochabamba, Bolivia. Chilean authorities expect that Bolivia will use its condition of host to promote and harness support to regain an outlet to the Pacific.

381 Ibid (my translation) 382 La Tercera, 2012b (my translation) 383 Delgado, 2012 quoted in Ibid

118

The scarcity of water has state security implications because their impacts on energy security affect the RSC, lessening the relative position of Chile in its regional context. Bolivia is using the energy needs of Chile, together with its own abundant hydrocarbon resources, as leverage to regain an outlet to the Pacific. The maritime aspiration is a security threat, insofar as it can only be satisfied at the expense of Chilean territory. Therefore, the scarcity of water is a source of strategic vulnerability, as their associated energy security implications leave the country exposed to external factors. The following analysis of the Argentinean gas crisis shows a different aspect of how Chile is exposed to external factors, and thus how water scarcity is a source of strategic vulnerability.

The Argentinean gas crisis As a result of the 1998/99 drought-hydropower crises, and the enactment of the Gas Exchange Protocol with Argentina, the Chilean government actively encouraged the proliferation of natural gas thermoelectric plants, which significantly increase its consumption (figure 5). From having almost no presence in the Chilean energy grid, in 2004 natural gas represented almost thirty percent of the country’s energy consumption and two years later almost fifty percent of the installed capacity in the SIC grid –not to be confused with actual generation- was based on natural gas. Argentina was the sole supplier. Precisely when natural gas began to acquire a key role in Chile’s energy security, diversifying the matrix and thereby guaranteeing supply, the Argentinean authorities, overwhelmed by domestic problems, began a series of cuts in gas exports that would put Chile’s energy security in dire straits for the second time in five years. In 2001-2002 Argentina experienced an economical and political crisis so deep that it had five presidents in two weeks. One of the measures adopted by the provisional administration was to implement a tax on exports of commodities and freeze domestic prices. Freezing the prices of basic services was an implicit subsidy that incentivized domestic consumption. At the same time, on the supply side this provoked generation companies to stop their explorations and development plans, which in the long run undermined their generation capacity and affected the supply of energy. In 2004, after two consecutive years of drought, hydropower was scant. Natural gas producers could not satisfy the domestic electricity demand and at the same time

119 fulfil their international commitments. Hence the Argentinean Secretariat of Energy decreed the Resolution No. 659/2004, which obliged gas producers to privilege the domestic market to the detriment of exportations. These ‘redirections’, as the Kirchner administration dubbed them, would persist until 2008, a period in which the exports to Chile declined on average between twenty and fifty percent below committed volumes.384

Figure 5: Annual gas consumption in Chile 1965-2006

Source: BP Statistical Review of World Energy, 2007 in Speiser, 2008

During the first year (2004) they were concentrated mainly in winter, because low temperatures drive energy consumption for heating purposes. In 2005 the outage problems were aggravated, because the Argentinean government approved a normative that forced its combined cycle plants to generate electricity exclusively with natural gas.385 In 2006 the restrictions remained constant throughout the year, with various critical episodes. In addition to the gas outages, domestic consumption of gas in Argentina kept growing and local production could not meet domestic demand, despite exports cuts. It is noteworthy that Argentina’s domestic demand is so large that, despite being one of the main producers in the region, to satisfy its needs it must import gas

384 Rudnick et al., 2007 385 AGN Chile, 2011

120 from Bolivia. In June 2006, when both parties renewed their gas exchange agreement, Bolivia increased the value of natural gas exportations to Argentina by fifty-six percent. To offset this, Argentina raised the tax on gas exports to Chile, Uruguay and Brazil.386 As mentioned before, this new agreement, still in force, has a clause that expressly prohibits Argentina to resell “A single molecule of (Bolivian) gas to Chile.”387 Apparently the Kirchner administration honoured it to the letter, because in August was registered what, up until then, the most critical of gas outages: thirteen consecutive days in which there was zero gas for industries. In 2007 restrictions increased again compared to the previous year. In February, there was virtually no gas for industrial operations in the central region. In May, two episodes of total cuts set for the first time the idea of ‘residential risk’. The terms of the Protocol state that Argentina is committed to ensuring gas provision for residential and commercial (rescom) purposes at any eventuality.388 It basically gives Chilean and Argentinean rescom the same priority. In May 2007 the Argentinean President made a public declaration in which he guaranteed rescom supply in all events.389 Despite this ‘presidential commitment’, a month later the situation worsened, and for the first time the amount of gas did not meet rescom. This would be repeated throughout the year. In December 2007 the presidents of Chile and Argentina established a bi-national commission to address the “gas issue”. This resulted in the reactivation of the ‘swap’ mechanism, by which Argentinean gencos would redirect natural gas to Chile and in exchange local gencos would finance the alternative energy (fuel oil) for the formers. The swap agreement was in effect little over two months, in which the gas levels that arrived to Chile tripled those of 2007.390 After its expiration the deliveries of gas to the central region fell to the “usual crisis levels”. Throughout 2008 there were several occasions in which Argentinean exports were below the necessary to meet rescom. In 2009 Chile began to import LNG from Trinidad and Tobago.391 This required the construction of liquefying plants in the port cities of Mejillones and Quinteros, in the north and central zones respectively. Argentina’s current energy situation is so dire that both governments have recently signed a new energy exchange and cooperation agreement that allows

386 EMOL, 2006 ; Rudnick et al., 2007:32 387 Bolpress, 2006 388 AGN Chile, 2011 ; El Mercurio, 2011 389 Quoted in Cardoso, 2007 390 AGN Chile, 2011 391 ENDESA Chile, 2009

121 Argentina to import natural gas from Chile. As explained by the Argentine Minister of Federal Planning, Public Investment and Services, Julio De Vido: “If at any time Argentina has surpluses and they can be placed in Chile, it will be done, and when Argentina has needs, it may obtain supplies from the re-gasification points (LNG plants) that the Chilean state has built in Quintero and Mejillones.”392

Twenty years of Chilean energy policy Different analysts have studied the energy sector in Chile. Some authors have focused in understanding hydropower from the perspective of electricity and water law, and the effects of neoliberal ideas on policy and institutional frameworks.393 Others have focused on the flaws and weakness of the regulatory framework that have lead to crises such as the Argentinean gas crisis or the blackouts of 1998/99.394 The aim of this review is to contribute to this literature studying energy policy through the lens of security. For a country like Chile, whose energy matrix has a major hydropower component, energy security is a particularly complex matter since water supplies are inherently variable and uncertain. As framed by Bauer: Because uncertainty of supply is a built-in feature of hydropower, electricity systems that rely on it must plan accordingly. Law and policy determine what level of security of supply is required (if any), how much reserve supply should be maintained, how both hydro and thermal power generation can help to meet those requirements, and how costs and risks are allocated between them.395 As it will be exposed, energy policy in Chile has systematically lacked a strategic long-term guidance. Instead of trying to compose an energy matrix (hydro and thermal) that ensures the supply of energy to meet the demands of economic growth, the focus of energy policy has been to seek low-cost energy sources that maximize short-term private profits. As a result, Chile is not only subject to climatic variables, but also to the political situation of neighbouring countries or the economic interest of private energy suppliers. The analysis of the last two decades of energy policy in Chile

392 GasNet, 2010 (my translation) 393 Bauer, 1998 ; Castillo and Maldonado, 2004 ; Matus et al., 2004 ; Bauer, 2009 ; Prieto and Bauer, 2012 394 Bernstein, 1999 ; Rozas, 1999 ; Chumacero et al., 2000 ; Díaz et al., 2000 ; Fisher and Galetovic, 2001 ; Galetovic et al., 2004 ; Maldonado and Palma, 2004 ; Galetovic, 2005 395 Bauer, 2009:608

122 illustrates how the scarcity of water influences the RSC and vice versa. It grants ascertaining how the socioeconomic and strategic impacts of drought have an effect on bilateral and regional relations, and reciprocally, how external factors affect the energy security.

From hydrological exposure to foreign vulnerabilities In the electricity sector hydropower has been historically the primary energy source. This strategy dates back to the 1940s, when the government created Endesa to carry out a national electricity plan of which hydropower was the backbone.396 Concurrently with the implementation of neoliberal policies in the 1980s and 1990s, Endesa was privatized together with all of the state-owned generation companies. The liberalization and privatization of the electricity market, including a successful rural electrification programme, provided nationwide access to electricity. In 1982 only sixty-two percent of the country had access to the grid, by the late 1980s this had increased to ninety-eight percent.397 In 1990 more than ninety percent of the installed capacity of the SIC was hydropower. Therefore, in order to diversify the power grid and access less costly energy sources, in 1995 Chile and Argentina signed a Gas Exchange Protocol. This agreement contemplated the construction of a pipeline (gas duct) through the Andes and the commitment of both governments to create the necessary conditions for commercial exchange. This agreement encouraged the instalments of natural gas combined-cycle power plants, which began operation in late 1998. Its main purpose was to bridge the gap between the supply of available energy and the steadily rising demand. It is noteworthy that the State played mainly a facilitator role, by signing the agreement and promoting capital investments for the development of the different projects necessary to import to natural gas from abroad. But the natural gas industry was developed entirely by initiative of the private sector. The Chilean developmental paradigm is based upon the constant need to increase the supply of energy to power its development. Since the early 1990s the official government discourse has argued that socioeconomic development requires more energy generation. In 1993 former President Patricio Aylwin declared “We cannot

396 Ibid 397 Mundaca, 2012

123 accept that ecology, as a sacred goddess, go up against development”,398 referring to the environmental controversy over the construction of the first of a series of mega hydroelectric damns in Alto Biobío, the biggest basin of the VIII Region. In 1990 Chile demanded 2,700 MW a year. In 2010 that figure jumped to almost 6,500 MW399 and according to official projections, to keep up the present economic development 8,000 MW need to be added in the next twenty years.400 This means that during the next two decades it will be necessary to duplicate the current energy generation. If every presidential administration is analysed by the type and percentage of energy with which it contributed to the energy matrix (Table 7), then it can be seen that each government has changed –or adapted– its energy plans to the contingencies that it has had to face, be they hydrological droughts or cuts on the imports of Argentine gas. During the 1990s the energy policy favoured the construction of hydroelectric plants. In the words of President Frei “The country cannot fail to build them, because it requires this kind of energy to not paralyse national development.”401 It was during his administration that the construction of the largest of the Alto Biobío damns began, Ralco, which became operational in 2004. By 1997, the impacts of the drought and the entry into effect of the Gas Protocol made the government shift the energy policy towards the construction of natural gas fed combined-cycle plants. As a result, in only five years thermal plants represented almost forty percent of the generation capacity of SIC system and natural gas represented almost thirty percent of energy consumption of Chile.402

Table 7: Presidential Energy Input P. Aylwin E. Frei R. Lagos M. Bachelet S. Piñera403 1990-1994 1994-2000 2000-2006 2006-2010 2010 - 25% Hydro 98% Hydro 40% Hydro 50% Hydro 36% Hydro 61% Thermo 2% Thermo 60% Thermo 50% Thermo 64% Thermo 14% others Source: Adapted from El Mercurio, 2011

398 Aylwin, 1993 quoted in El Mercurio, 2011 (my translation). 399 Ibid ; ME, 2012 400 ME, 2012 401 Frei, 1998 quoted in El Mercurio, 2011 (my translation). 402 Castillo and Maldonado, 2004 403 When the analysis was done 18 months had past of his 4-year term.

124 As a result of the drought/electricity crisis of the late 1990s and the Argentinean gas crisis, in the last years the Chilean energy matrix has undergone a transition to coal and diesel operated centrals.404 During the first half of the Lagos administration natural gas thermal plants were promoted, until the import restrictions from Argentina forced it to look for alternatives. Hence for the continuity of service, generation through thermoelectric plants was explored, based on both coal and LNG. The latter required importing from overseas in tank ships and the construction of liquefying plants in port cities. For this purpose, Endesa, Metrogas (the biggest rescom and industrial gas supplier in the Central Zone) and ENAP (the government owned National Petroleum Company) formed LNG Chile. The first shipment arrived in July 2009, and it appears that authorities were so anxious that the then Secretary of Energy and the CEO of Endesa travelled especially to Trinidad and Tobago to witness the first load bound to Chile.405 Michelle Bachelet assumed presidency when the problem of gas shortages was in one of its most complicated stages. Accordingly, she defined as one of her priorities to secure energy supply and to achieve energy independence. In August 2006, in one of the worst period of gas cuts, she declared: “The goal is that in two years we will have ensured the autonomy, the supply, the energy efficiency and the sustainability in development.”406 During her presidency sixty-eight of the installed capacity corresponded to thermoelectric plants (LNG, natural gas and oil). Despite these efforts, energy autonomy and independence has still not been achieved. The current President, Sebastián Piñera, has been in office for two years, enough time to make the orientation of his energy policy clear. According to the law that governs this sector, by 2024 at least ten percent of energy generation should be generated with non-conventional renewable energies (NCRE), but he aspires to make it twenty percent by 2020. Despite this ‘green effort’ in 2010’s annual address to the nation, he also declared: “We cannot renounce to either hydraulic or thermal energy.”407 So far it has approved nineteen power plants. Nine of these are hydroelectric, five thermoelectric and five wind power plants. This brief overview of twenty years of energy policies shows that the precarious current situation of energy security is the result of the lack of a long-term vision

404 ME, 2012 405 ENDESA Chile, 2009 406 Quoted in El Mercurio, 2011 (my translation) 407 Quoted in El Mercurio, 2011 (my translation)

125 including strategic and security considerations in energy policy. An example that illustrates the fragile situation of energy in Chile, and the failure of the energy policy to secure supply, is that in November 2012 British Gas (BG), the gas provider of LNG Chile, announced that it will reduce their gas shipments to Chile in up to forty percent, adducing reductions in gas production in Great Britain and Egypt, among other reasons. However, according to press reports BG is trying to utilize the gas restrictions to pressure LNG Chile, to renegotiate the contracts, according to which prices were suppose to be reduced due to changes in the formula.408 These potential reductions will directly affect Endesa and ENAP, since the former use LNG to operate power plants and the latter to operate its refinery located nearby Quinteros. In addition, it will also affect Colbún and Gener, two gencos that purchase LNG surplus from Enap and Metrogas to supply their power plants.409 While the government has contacted British authorities,410 Endesa and ENAP have announced that they are willing to take this issue to international courts, if the situation requires it.411 Regardless of the reasons or the outcome of this new potential energy crisis, it proves that energy policy in Chile has lack a strategic long-term guidance, and thus the country is energy insecure. In spite of the different efforts and strategies pursued, Chile still depends on hydrological conditions to secure its energy autonomy. To put this in context, in dry years about half of the normally available hydraulic energy disappears from SIC system, the equivalent of around 13,000 GWh. In 2004 the total energy generation in natural gas power plants was less than 9,000 GWh.412 This means that droughts have a greater impact on energy generation, and thus are a more significant source of energy insecurity than events such as the Argentinean gas crisis. But, at the same time, this also means that when droughts affect the territory, Chile is exposed to external factors, such as the political situation of its energy providers or the prices of hydrocarbons in the global market. Therefore, in order to increase both, human and State security, the national energy policy should be able to answer in a comprehensive manner the challenges of security of supply, energy autonomy and environmental sustainability imposed by the unusual geography and complex regional situation of Chile.

408 El Mercurio, 2012f ; NuevaMinería, 2012 409 NuevaMinería, 2012 410 El Mercurio, 2012f 411 La Segunda, 2012c 412 Galetovic et al., 2004

126

127 128

Chapter 4: Analysis

The study of the security implications of water scarcity in Chile is timely and relevant, as in this nation-state it is a multidimensional security issue that affects all security sectors and several analytical levels. Droughts distress the natural resource base of the country; limit the population’s access to livelihoods resources and severely compromise energy generation and supply. The subsequent energy insecurity affects, in turn, the regional security complex. As a result of the combination of the biophysical conditions, the socioeconomic structure and the geopolitical situation of Chile, the scarcity of water becomes a problem of both human security and state security. Water-related problems are a relevant matter in security studies, as water has no substitutes and knows no geopolitical boundaries; it is present in all aspects of human life and performs irreplaceable biological, social and economic functions. Because it is vital for individuals and nation-states alike, water is a strategic natural resource. Precisely because of its ubiquity, the scope and scale of the security implications of the scarcity of water vary depending on the unit of analysis. For example, the long-lasting drought that affected Australia during the last decade provoked a decline in agricultural production, an increase in the occurrence and severity of bushfires and dust storms, and a reduction of water available for human consumption, among other effects. Nevertheless, it never cast shadows over energy security, because in Australia energy generation is largely based in thermo power.413 Framed from a security lens, drought impacts were located at the social and economic sectors and at the unit and subunit levels, but not at the strategic sector or the subsystem or system levels. In contrast, the three-year drought that affects Chile since 2010, together with reducing agricultural production and limiting the access of water for human consumption, it has also compromised energy security. Water reservoirs throughout the country are at historical lows and, despite governmental actions and measures, power cuts have not been discarded.

413 It is noteworthy that water is used in thermo power for cooling process. Australian thermal stations did have to adjust to the situation, but the lack of water did not cause blackouts, as in the case of Chile. For more on this see Marsh, 2008

129 The comparison between Chile and Australia shows that water scarcity has an intrinsic human security component, but not necessarily a state security facet. The latter depends on the particular conditions and circumstances of the unit of analysis. On the domestic sphere, there are state security implications to the extent that water scarcity can detonate situations of social unrest that are serious enough to jeopardize the continuity of a given government, or that significantly alter its integral functioning. In the international sphere, the geopolitical factor is key in determining State security implications, as water scarcity is a source of strategic vulnerability to the extent that alters the security complex, or other relevant wider patterns of security relations, located at the subsystem or system levels. Water scarcity in Chile is a strategic security problem because affects the livelihood of the population, limits the overall capabilities of the country and has an effect on the regional security complex. In other words, the impacts of water scarcity in Chile are located at the environmental, social, economic, strategic and political security sectors, and at the subunit, unit and subsystem analytical levels. The multilevel- multisector approach used in this thesis grants for the unpacking of security implications of water scarcity, and thus establishing the magnitude and extension of these impacts at each security level and sector. In this manner it is possible, first, to identify the dynamics and feedback channels between sectors and levels, the ‘bridges’ that link them, which facilitates understanding how they affect each other. More analytically significant, the framework developed permits addressing the human and State dimensions of security simultaneously, not just in Chile but also in any given nation-state. This is one of the relevant contributions to the security debate of this research: a methodology to study droughts that can be used to understand and determine the security implications of water scarcity in any other nation-state. One of the main challenges of studying the relation between droughts and security is that there is no framework to specifically analyse the security implications of droughts. There are frameworks to quantify its socioeconomic impacts, and thus determine the socioeconomic vulnerability;414 there are indices to determine the degree of hydrological deficits,415 but there is no framework that integrates all of these different

414 For example, the ISDR framework purpose is to determine and reduce the vulnerability of a country to drought impacts. 415 See Dai, 2011

130 variables through a security frame. This framework grants the articulation of droughts as seen through the lens of security. Although, it remains to further research endeavours to explore the possibility of adapting this framework to other, different environment-related problems.

Security implications of water scarcity in Chile

Water scarcity is a relative concept, the function of the natural availability and the multiple, competing uses of water. This is why hydro climatic variability and water vulnerability are both physical and social in nature. Regarding the physical aspects, droughts are one of the most relevant sources of waters scarcity, as they significantly reduce the natural availability for seasons, years or even decades. Droughts are a distinctive feature of the climate of a significant part Chilean territory. Added to this, is the fact that in recent decades there has been a decline in precipitations, a trend that will most likely persist and deepen as a consequence of global climate change. In regards of the social aspects, as determined by the ISDR framework a country’s exposure and vulnerability to droughts is determined by the interplay between its biophysical conditions and its socioeconomic structure. As seen in Chapter 2, water is already a scant resource in Chile, since despite its apparent abundance at the country level, regional analyses shows that water is relatively scarce, because is more demanded where is less available. In Chile population and water-intensive economic activities, such as mining and agriculture, is concentrated in areas of the country in which the natural availability of water is reduce, like in the Central Zone, or almost inexistent, as is the case of the Atacama desert and the Great North. As point of fact, there are areas in which the levels of water availability is less than half of what is considered the minimum for sustainable development.416 Considering that Chile has major environmental vulnerabilities to climate change,417 and that considerable scientific projections estimates that it will be significantly affected by it, it is most likely that over the coming decades droughts are going to be more recurrent, severe and extended, both in duration an in the spatial area affected. In this sense it is important to highlight, first, that population and economic activity are concentrated in regions that suffer “a nine-month drought every year”.

416 See pages 49-51. 417 See http://www.vulnerabilityindex.net/

131 Second, precisely in these regions, internal fluctuations in precipitations show greater variability of rainfall,418 which further accentuates the “supply” of water problem. In regards to the effects of Climate Change, the Executive Secretary of the National Irrigation Commission, Felipe Martín, stated: In the last few decades we have seen how precipitations are concentrated in shorter periods and water drains more rapidly, preventing infiltration and the generation of natural reservoirs in the mountains. Furthermore, the isotherm is increasingly at higher altitudes, resulting in a lower accumulation of ice and snow, necessary for the summer period.419 This is relevant by itself, but becomes more important if one considers another component of the social aspects mentioned before. One of the major drivers of the demand for water is socioeconomic development. Since the economy of Chile is market oriented, based on the exportation of goods whose production processes are water intensive, and that the national objective is to achieve the status of a developed country by 2018,420 the demand for water is necessarily going to increase in the following years. For example, in regards to the irrigation demand, in order to achieve this development goal governmental projections estimate that the irrigated area needs to be extended by 350 thousands ha, this is an increase of thirty percent.421 This not only adds more pressure on current water resources, but as a consequence it also augments the vulnerability of Chile to droughts, as a greater share of economic activity will directly and indirectly depend on the hydrological conditions. This is particularly relevant when considering that in the last decades the Chilean agricultural industry has grown at a more dynamic pace than the national GDP, and that more than a third of the population has its source of income tied to agriculture.

Internal security implications: Waters scarcity as a source of human and strategic insecurity Following the proposed typology of environment-related problems as security issues and sources of insecurity, it is possible to assert that the most significant domestic security implications of water scarcity are found, first and foremost, in their impacts on the environment, social and economic sectors. They affect the

418 Brown and Saldivia, 2000 419 Martin, 2012 quoted in El Mercurio, 2012g 420 This Strategy is defined in Chile Developed Country Agenda (my translation), available in http://www.gobiernodechile.cl/especiales/agenda-chile-pais-desarrollado/ 421 MOP, 2010 quoted in World Bank, 2011

132 environmental sector, because they augment erosion levels; they impact the economic sector, in both its productive and labour facets; and subsequently they affect the social sector, mainly because of how they affect the availability of food and employment, two significant livelihood resources. All of these socioeconomic consequences are directly related to the conceptualization of human security, especially with the dimensions of economic security, food security and health security. For example, in Chile more than one third of the economically active population is related to agriculture, and almost seventy-three percent of people who declared to have been affected by the latest droughts is located in the lower income levels. Furthermore, the lack of water compromises the health of the population, by limiting the possibilities to comply with personal and food hygiene, which partly explains why outbreaks of enteric diseases are associated with droughts. The governmental response to the 1994-1997 drought, comprised in the actions and measures of the CNS (National Drought Commission), can all be framed within the human security narrative. They either intended to improve people’s livelihood (distribution of food rations in poverty stricken schools) or their access to livelihood resources (repairing and building irrigation systems). Therefore it is possible to assert that at the unit and sub-unit levels of analysis the most significant human security implications, and the most appropriate responses, can be found within the human security framework, in the environmental, social and economic sectors. In this sense it is worth mentioning that a study conducted in the Limarí Province422 (IV Region of Coquimbo) that examines the effectiveness of different long-term irrigation public policies, determined that these policies, together with State subsidies that increase the technical and economic efficiency of water utilization, had a positive effect in improving human security.423 This entails that water was a source of human insecurity before these policies and subsidies were implemented. But the internal security implications of water scarcity are not restricted solely to these sectors. The water-energy nexus facilitates the integration of the multidimensional security implications of water scarcity in Chile and to establish a link between human and State security. Droughts are a source of human insecurity, because their impacts limit the access to livelihood resources of rural population. Given that the

422 Limarí is a drought prone area, where precipitation has decreased over the last century, and whose population is one of the poorest in the Chile. 423 León and Garay-Flühmann, 2005

133 energy matrix is highly dependant on hydropower (Figure 6), and due to the strong positive correlation between energy and economic growth, the impacts on energy generation indirectly augment human insecurity, since blackouts alter the livelihoods of the population and energy shocks have effects on employment, inflation and economic growth.

Figure 6: Installed capacity by energy source in SIC system 2009

Source: Adapted from www.centralenergia.cl

In addition to, and compounded with this, power outages as the ones that Chile endured for eighty-one days during the energy crisis of 1998/99, affects a nation-state capacity to provision the various products, resources and services required for general development and social well-being. This in turn limit the range of policy responses of the authorities and their capacity of giving material responses to crises, of any nature, that may unfold. Energy insecurity has an inherent human security dimension, particularly for developing countries, because it alters the well-being of the population. The Western developmental model is based on the assumption that social development is driven by economic development, which requires a continuous and reliable source of energy. Hence, energy is essential to improve people’s lives. But for a security analysis the most significant implications of energy insecurity are located in the strategic sector. Energy security is the bridge that links the unit level and the regional level, the human and the State dimensions, because the impacts in energy security have effects on both dimensions. In so far energy insecurity alters the security complex of Chile, the scarcity of water becomes a source of strategic vulnerability.

134 External security implications: energy insecurity and the Regional Security Complex Given Chile’s increasing energy needs, and that the three neighbouring countries of Chile are relevant actors in the energy concert of South America, the Regional Security Complex Theory (RSCT) is a useful analytical tool to understand the security implications of water scarcity in Chile. As shown in Chapter 3, as a result of its dependence on hydropower, in dry periods more than half of the energy disappears. This leaves the country exposed to external factors/actors, such as the climatic, political or economic situation of the countries that provide energy resources, and thus their authority’s policy decisions and priorities. For example, in 2004 the Argentinean gas crisis was triggered by a drought that aggravated the economic and political crisis that this country was going through, and its authorities resolved to satisfy domestic demand at the expense of their international commercial commitments. But in 2004 another event in the RSC of Chile occurred, much more significant in traditional and non-traditional security terms. That year Bolivia held a binding referendum by which the population mandated its authorities to use the hydrocarbon resources as a bargaining chip in any potential negotiation with Chile to regain an outlet to the Pacific. Bolivia’s maritime aspiration is an overarching force in both its domestic and foreign policy. Different governments have used the ‘maritime question’ in times of internal unrest as a token to unite the population behind them.424 Almost all administrations have tried to link whatever dispute, resources, or bilateral and multilateral issues existing at the time, regardless of its connection to the maritime question, in order to use them as leverage in this territorial dispute. Bolivia is aware of the fragile energy situation of Chile and is using it to its advantage. It is not just a coincidence that the same year (2006) that the Morales administration inaugurated a military base on the banks of Silala –an action that falls within the traditional security–, Bolivia negotiated an energy trade agreement with Argentina in which the latter is expressly forbidden to resell “A single molecule” of (Bolivian) gas to Chile, certainly a non-traditional security instrument. It is worth to highlight that historically the neighbour politics/policy of Chile has been oriented towards preventing the formation of a Perú-Bolivia-Argentina entente. This is known in Chilean strategic circles as HV3, Spanish acronym for hypothesis of conflict against all three neighbours. The Argentina-Bolivia energy alliance that openly

424 Mendoza, 2006

135 excluded Chile was not welcomed in Chile, and did not help to ease the already tense relations. The binding referendum, the exchange agreement with Argentina and the recent announcement of projects in the Silala basin that might use completely the water of this watershed illustrate the wider foreign policy of Bolivia: to use any means possible to regain an outlet to the Pacific. The significance of this is that the maritime aspiration of Bolivia is a security threat to Chile, because it can only be satisfied at the expense of its territorial integrity and sovereignty. Water scarcity is a source of strategic vulnerability in Chile, firstly, because in its geopolitical regional context, it gives a foreign actor, Bolivia, a valuable token in the long-standing territorial bilateral disputes. And as a consequence of this, it lessens the relative power position of Chile in the Southern Cone RSC.

Non-traditional sources of traditional security The fact that any given problem of environmental origin, such as a drought, becomes a security issue does not necessarily mean that militarizing it is the most appropriate response. As different commentators have pointed out, this might actually be counterproductive.425 In this line Parthemore and Rogers highlight that “Security is broader than military issues and homeland defence…if security threats are not always military in nature, military operations are not the only means to achieve security.”426 The broadening of the security agenda not only widened the possible security threats and sources of insecurity, but it also extended the possible sources of security. Framing water scarcity as a source of human insecurity, or as strategic security issue, rather than as a security threat, facilitates searching for sources of security beyond the military or the political sectors. For example, currently in Chile seventy- three percent of the water is used to irrigate 1.1 million ha of arable land, which corresponds to little over thirty percent of the agricultural surface, while eighty-four percent of the country’s water with irrigation potential is literally poured into the ocean. In this respect, as noted by Brown,427 is important to consider to relevant aspects: first, the majority of this surplus is located in the X and XI regions, in islands and areas with geographical barriers that makes very difficult to access and utilize.428

425 See pages 62-70. 426 Parthemore and Rogers, 2010:10 427 Brown, 2012 428 Brown and Saldivia, 2000 ; Salazar, 2003

136 Second, the water that drains in the ocean has irreplaceable ecosystemic functions throughout the basin and in the drainage area, and most of the time these factors are not considered by authorities. Nevertheless, as the expert explains, even considering these caveats, in Chile there is still a significant amount of water that could be utilized, but the country lacks the necessary infrastructure. In the words of the Secretary of Agriculture: “The complex situation (of current water scarcity) illustrates the problem: the backlog of more than fifty years in the development of accumulation infrastructure and the absence of a long term, sustainable policy.”429 To put this figures in context, Chile has an availability of water three times higher than Australia, but has a storage capacity twenty times lower. In this scenario Chile has 1.1 million ha under irrigation, while Australians reach over 5 million.430 It is noteworthy that even the resource efficiency of drinking water systems is very low, since twenty-five to thirty percent of the water treated it is lost in the distribution process. As it can be seen, today the main problem in Chile is not necessarily caused by an acute decline in water availability, which is definitely happening, but the mismanagement and inefficient use of the resources available. As mentioned before, it has been established that public policies oriented to increase the efficiency of water utilization had a positive effect in improving human security.431 Promoting technified, resource efficient irrigation systems, such as drip or spray irrigation, or building dams with an inter-annual capacity, would increase the relative availability of water, which in turn would decrease the strategic vulnerability and exposure of the country to the hydrological conditions. Just like what happens with irrigation, in Chile energy efficiency levels are far from optimal. During the last two decades the energy demand has grown consistently at rates higher than national GDP, despite the ups and downs of the economy. This is an indicator that energy is not being used efficiently. For example, it is estimated that Chile has the potential to generate up to 860 MW through run-of-the-river plants, on small basins that today are used for irrigation only (without any kind of storage system, it must be added).432

429 Mayol, 2012 quoted in El Mercurio, 2012e (my translation) 430 El Mercurio, 2012g 431 León and Garay-Flühmann, 2005 432 El Mercurio, 2012a

137 Moreover, despite its significant natural potential,433 currently NCRE represent only three percent of the energy matrix of the country, considering both SIC and SING systems. It is estimated that Chile has a potential gross generation through NCRE of the order of 191,000 MW, with a technically feasible potential of 10,803 MW. Out of these, at least 3,332 MW are economically feasible to add to the SIC matrix by 2025.434 NCRE have the potential to increase the overall energy security by diversifying the matrix. This would increase State security by reducing the exposure to hydroclimatic conditions. In addition, it would augment human security because for low-income sectors reducing the spending on energy consumption is particularly important, since such expenditure often represents a major portion of their total income. Therefore, energy efficiency policies and programs, together with a diversified energy matrix that exploits the available resources in a sustainable manner, would reduce the dependence of Chile on water, and subsequently decrease its strategic vulnerability to droughts. As one commentator notes, one of the advantages of promoting and implementing NCRE is that it reduces the energy dependence on politically unstable supply chains, as the ones that characterized fossil fuel sources.435 The operation extending the possible sources of security to non-traditional security sectors, such as the environmental, social and economic, permits establishing the connection between the dimensions of human and State security. This nexus is epitomized in the energy sector and energy security. First, if Chile had the appropriate infrastructure to harness and utilize the water resources at its disposal, and second, if these resources were used efficiently, at its maximum capacity, then it would be less vulnerable to the scarcity of water, even considering the adverse hydroclimatic conditions. Increasing energy security, in turn, has direct and indirect positive impacts in improving human security: direct, because the population is less likely to be affected by crises such as blackouts; indirect, since a reliable source of energy is a sine qua non for economic growth. In the particular case of Chile, increasing energy security also strengthens its relative power position in its RSC, and thus State security is strengthened too.

433 Castillo and Maldonado, 2004 ; CNE, 2008 ; ME, 2012 434 IAP and CIE, 2008 435 Etcheverry, 2009

138 In sum, the impacts of water scarcity, a non-traditional security problem, in the environmental, societal and economic security sectors have negative effects in the human security of the population of Chile. Therefore, water scarcity is a source of human insecurity. Respectively, the impacts of water scarcity in energy security, which can be located in the economic, political and strategic security sectors, and at the unit and sub-system levels, have negative effects in the State security of Chile. Therefore, water scarcity is at the same time a strategic security issue and a source of strategic vulnerability. Consequently, if a non-traditional security problem can become a source of State insecurity, then non-traditional security measures, originally aimed at improving human security, as a consequence of the systemic nature of security, have the potential to augment the State security of a nation-state. Correspondingly, given that public policies can have positive impacts in human security, then public policies and the institutional framework can also be a source of insecurity and/or lessen State security, as the drought/hydroelectricity crisis and the analysis of the Chilean energy policy proves.

A securitization of water? Given the strategic significance that water has to the security of Chile, it is pertinent to ask whether water is being securitized. And if so, with what intention and for what purpose? There is no straightforward answer to these questions. Considering that a securitization move has three components, an existential threat, emergency actions and effects on inter-unit relations by breaking free of rules,436 in Chile water has not yet been securitized. Up to this point water itself has not been framed in military terms, emergency actions have not been taken, and neither its control nor management has been defined as above and beyond the rules. However, there have been attempts of securitizing energy. Given that one of the key elements of a securitization move is the speech act, it is important to note that over the last two decades relevant security actors have progressively framed energy and electricity generation as indispensible means to ensure, sustain and secure socioeconomic development, which in the case of Chile necessarily entails water.

436 See pages 37-40.

139 As noted in Chapter 3, in 1993 President Aylwin declared, “We cannot accept that ecology, as a sacred goddess, go up against development”.437 In 2006 President Bachelet defined it a national goal to “Ensure the autonomy, the supply, the energy efficiency and the sustainability in development.”438 In 2008 the report that delineated the energy policy of her administration states, “Solid economic growth is not possible without a reliable source of energy at reasonable costs”,439 and defined as a national objective to achieve energy autonomy. In this line, the current government launched the National Energy Strategy (NES) in 2012, allegedly a guideline for the next two decades. In this document energy autonomy is defined as a central objective and establishes that hydroelectricity should represent at least half of the energy that needs to be added in this period.440 Thus, whereas in the speech act water itself is not directly mentioned, relevant security actors and policy options designate energy autonomy as a national priority, inasmuch is a requisite for development. The above mentioned were indirect or implicit securitization moves, because they were done under the banner of development, in 2011 the Secretary of Defence openly defined energy as the greatest security vulnerability. “As a country we objectively have major energy vulnerabilities, which if not overcome, could become, or perhaps already are, security threats to the country.”441 This is possibly the first time in Chile that a security actor, directly related to the military sphere, presented energy as a security issue to the public. This might also be the first time that energy has been designated more than just a national development priority, but as a strategic vulnerability and as a security threat, which frames energy as a strategic and military matter. This is relevant because currently hydropower is a major component of the energy matrix and, according to the NES, half of the energy that is going to be added to the system is based on hydroelectricity. Consequently, by securitizing energy, water is intrinsically framed as a security issue, which in the long run could progressively lead to a more direct securitization of water. As point of fact, a first attempt in this direction has already occurred. In April 2012 President Piñera stated that “There are two resources that will be crucial to the development of our country and of all countries of the world in the twenty-first

437 Quoted in El Mercurio, 2011 (my translation). 438 Quoted in Ibid (my translation) 439 CNE, 2008:10 (my translation) 440 ME, 2012 (my translation) 441 Allamand, 2011 quoted in La Segunda, 2011 (my translation)

140 century...these are water and energy.”442 The significance of this is that it is the first time that a president has spoken not just about energy, but directly defined water as vital for the development of the country. Authors such as Deudney, Conca and Barnet have warned about the risks of securitizing environment-related problems.443 On the one hand, securitizing these problems locates them in the wrong set of solutions, the military, and thus are dealt by inappropriate actors with inadequate means. But most important, the security banner might be used to legitimize traditional security practices, or to influence the distribution of money and power. While there is not a militarization of water or energy in Chile, in the past the development banner has been used to dismiss environmental considerations. Hence there is now a risk that the ‘security’ framing could be used as well to override environmental, social or any other significant considerations, in favour of political or economic criteria. When President Aylwin declared that ecology cannot hinder development, it was basically establishing that socioeconomic development, and thus the energy to power it, was above the normal rules of the game. Almost two decades later, the same argument was used in the same context: since 2011 there is a nation wide debate regarding the building in Patagonia of a mega dam —HydroAysén—, a hydroelectric plant that by itself could provide nearly a third of the energy needed in the SIC system over the next twelve years. The authorities have faced the social opposition found to this project arguing that the country needs to develop. The Interior Minister declared: “The most important thing is that our country needs to grow, to progress, and for this we need energy.”444 The Defence Minister has already designated energy insecurity a security vulnerability and a security threat. The President has designated water and energy as vital for the country. If climate change unfolds as predicted, and Chile maintains its current pace of socioeconomic development, water will become a very scant resource. This could open the opportunity to frame the scarcity of water as an existential threat for the country, permitting the authorities to call for a mobilization of resources and enact emergency measures. The securitization of water, and the banner of ‘water

442 Quoted in EMOL, 2012 (my translation) 443 See pages 37-40. 444 Hinzpeter, 2011 quoted in Hufftinton Post, 2011

141 security’, could be used to override or disregard important debates and other political, social and environmental considerations. On the other hand, if security is understood within a broadened perspective, composed by military and non-military elements, then non-military aspects can be a source of both human and State security. And if this paradigm shift is more than just a rhetorical endorsement, but it actually fosters institutional and policy changes, then security could be used as an instrument to consider and include non-military elements, such as ecological or social considerations, in the decision making process. It could be used to assess, integrate and conciliate the competing interests and needs regarding the use of water. For example, in the specific case of Chile, water security could be used to promote the building of nation-wide water storage systems and encourage resource efficient systems and practices. This will improve people’s livelihoods, augment the autonomy of the country and strengthen its overall security. Given its biophysical, socioeconomic and geopolitical conditions, what can be defined as the structural components of the security complex, the securitization of water in Chile is, to some extent, inevitable. The scope and scale of the security implications of water scarcity are too wide and too vast. They go beyond the internal sphere, affecting wider patterns of security relations and dynamics. But if the securitization of water is inevitable, how it is managed and with what purpose is not. If it is used to legitimize traditional security practices and preserve the distribution of power, then the securitization of water is nothing but undesirable. But if it is used as an instrument to improve people’s livelihood, promote sustainable development, preserve the environment and foster interstate cooperation, it might be a desirable political tool.

142

143 144

Conclusion

This thesis explored the relationship between environment and security, studying the security implications of water scarcity in Chile. It aimed to prove that a problem of environmental origin has the potential to affect a nation-state in its human security and State security dimensions simultaneously. The most accessible way to trace and understand the security implications of the scarcity of water is through the impacts of droughts in the different analytical levels and security sectors. Because the two main drivers of water scarcity are the hydrological conditions and water demand, and in turn one of the drivers of the impacts of droughts is the socioeconomic demand for water, the analysis of the droughts of the last two decades facilitates sketching an accurate picture of the current potential magnitude and extension of the security impacts of water scarcity. First, for Chile water scarcity is an objective risk, to which it is highly vulnerable, because dry periods are already a distinctive feature of its climate and it is expected that they will become more severe, recurrent and extended. In addition, its socioeconomic structure makes it particularly susceptible to their impacts, because it affects relevant economic areas that, in turn, are tightly connected to employment opportunities. This is the human security dimension of the scarcity of water, and accordingly they are best framed and tackled within a human security framework. Second, although the above is important per se, for a security analysis the most relevant implications are the ones related with energy security. The dependence that the Chilean energy matrix has on hydroelectric generation makes it particularly vulnerable to droughts. As such, energy becomes a direct link between the social, economic and strategic sectors, and even if the connection is less straightforward, energy insecurity is also the link with the environmental and political sectors. This is the state security dimension. However, it is not appropriate to define water scarcity as a security threat for two reasons: first, current available evidence suggests that it is unlikely that it would trigger an interstate violent conflict, one of the most relevant aspects of a threat. Second, threat implies the intention of causing harm, something that water scarcity obviously lack. However, because it alters the integral functioning,

145 limiting its overall capabilities and the policy and material options of the country, water scarcity constitutes a source of strategic vulnerability for Chile. Third, as a result of the above a nexus between human and State security is established. Articulating environment-related problems as sources of human insecurity, strategic security issues or sources of strategic vulnerabilities permits looking for non- traditional sources of security. Consequently, for the case of Chile measures that are usually associated with the human security dimension, such as building water storage infrastructure, due to the particular conditions of this unit of analysis, are also a source of State security, since they augment the relative autonomy of Chile, thereby strengthening its position in the regional security complex. Fourth, the relationship between security and the environment is usually addressed from either a human security or a State security dimension. The specific biophysical and socioeconomic conditions of Chile, together with the particular characteristics of its regional security complex, facilitate approaching this relationship by integrating both dimensions. This is one of the most significant contributions of this research. But at the same time it is one of its limitations, since it’s the specificity of the conditions of the unit of analysis (Chile) what grants this distinct approach. Probably a nation-state less dependent on hydropower, or with regional relations governed by patterns of amity and cooperation, would not be as vulnerable to water scarcity as Chile is, and thus it would not constitute a source of insecurity. This does not diminish the relevance of the findings of this research, but underscores what should be a guiding principle for the construction of knowledge: to approach the object of analysis as such, with its own characteristics and context, trying to leave out personal judgments and preconceptions, as much as is humanly possible. This research does not exhaust, either, the security implications of water scarcity in Chile. For example, questions like “Would the freshwater reserves contained in the Patagonian Ice Field form a HS or a HSC between the two ‘riparian’ states (Chile and Argentina) in a scenario of local/regional/global water scarcity?” suggests further areas for enquiries. The aim of this thesis was not to answer all questions, but to shed light on and give new insights to a very contested area of research, the so-called environmental security.

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Appendix

Evapotranspiration throughout Chilean Territory

The following is and excerpt from the National Report of Water Management in Chile.445 The spatial distribution of potential evaporation is mainly determined by temperature, reaching values of the order of 3,000 mm/year in the Atacama Desert in the north, and decreasing down south to 650 mm/year in Punta Arenas, over the Strait of Magellan, with ups and downs due to local conditions. The main aspect of the evaporation lies in what corresponds to the actual evapotranspiration, which is shown on the map of isolines (Figure 7). This component is obtained from the water balance of the study areas. In the Dry Pacific Hydrographic System (corresponding to the Great North and Small North zones), the actual evapotranspiration isolines coincide with the isohyets in the coastal and interior strips. Only in the mountains there is a surplus of rain that evaporates and drains, above 4,000 meters, with evapotranspiration between 150 and 250 mm/year. More to the south, reaching the 31ºS, where rainfall and can reach 500 mm/year in the mountains, evapotranspiration borders 300 mm/year. In the Hydrographic System of Central Chile, the isolines run parallel to the mountain ranges, with a maximum at the foot of the mountains, which decreases towards east and west. This maximum loses relevance to the south of 35°S. The westward decrease is caused by the higher marine humidity that alters evapotranspirative processes of precipitated water. To the east, this decrease is explained by the lowest temperature found at higher altitudes in the mountain, which does not provide the conditions for increased evaporation. The values in the coastal strip vary from 200 mm/year at 32º S and 600 mm/year at 37º S, with an increase towards inland of about 200 mm/year, excluding the effects of irrigated areas. Finally, in the South Pacific System (corresponding to Patagonia) is recorded a continuation of what is experienced in southern end of the Central System. Towards the south there is change in which is found a distribution of the isolines longitudinal to the Andes Mountain Range. The maximum occurs in the channels area, of 500

445 Brown and Saldivia, 2000:24-26

167 mm/year, and the minimum occurs in the Ice Fields, with values below 300 mm/year. Just as it happens throughout the country, the transAndean sector shows a progressive eastward decrease in evapotranspiration, as the precipitations value varies. Figure 7: Map of mean annual isohyets

Source: Brown and Saldivia, 2000

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Minerva Access is the Institutional Repository of The University of Melbourne

Author/s: Zambrano Ramírez, José Pablo

Title: Red hot hydropolitics: human and state security implications of water scarcity in Chile

Date: 2012

Citation: Zambrano Ramírez, J. P. (2012). Red hot hydropolitics: human and state security implications of water scarcity in Chile. Masters Research thesis, School of Social and Political Sciences, The University of Melbourne.

Persistent Link: http://hdl.handle.net/11343/38077

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