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Maltese Environment

Coca Cola takes 40% of its water for free, yet consumers and the environment pay the full price

A recent article brought to light how General Soft Drinks Ltd (the main suppliers of Coca Cola and affiliated products in Malta) extract 40 per cent of the water it needs to produce its beverages free of charge from public freshwater resources. While other major beverage companies in Malta prefer to not use groundwater and pay for mains water, GSD prefers to adopt the cheaper route whilst promoting itself as an ambassador of water conservation.

Despite the fact that the Maltese authorities vocally lambast illegal borehole users, they turn a blind eye when corporate entities such as Coca Cola suppliers General Soft Drinks Ltd use 40% of public water for free. Such a paradox would be laughable in any developed country other than Malta. (Photo credit: TimesofMalta)

When it comes to groundwater, Malta is as critical as it gets. Apart from the being the most water poor country in the EU, it is listed as one of the top ten water poorest countries in the world alongside Bahrain, Jordon, Kuwait, Libya, Maldives, Qater, Saudi Arabia, United Arab Emirates and Yemen. Such is the result of an overpopulated island country that does not regulate the illegal abstraction of water from its aquifers, increasing the probability of saltwater intrusion (a process where seawater enters rocks and mixes with freshwater).

It is quite shocking that GSD is not paying for 40% of the water it uses in its manufacturing process, especially when it made a total revenue of €25,196,503 by the end of 2013. It would be extremely difficult to estimate how much this revenue translates into volume of water, since GSD’s products include both carbonated and non-carbonated drinks of differing packaging. However, a very crude estimation is worth my time, especially if it will produce a figure of how much water GSD is abstracting from public sources at zero cost.

  • It can be rationalised that small cans (0.33L) and bottles (0.5L) are more popular than larger bottles (1.5 L) since they are more easily accessible on a daily basis, whilst the latter are generally purchased at supermarkets for domestic consumption. As such, each size of beverage would roughly account to a third of sales respectively.
  • The average retail price from a supermarket (the cheapest place to purchase such goods, and hence the most realistic comparison) would be 0.67c for a can, 0.97c for a 0.5L bottle and 1.45c for a 1.5L.
  • Wholesale price is generally up to 40% cheaper when the supermarkets purchase the beverages from the company (GSD). As such, the prices now become 0.40c for a can, 0.58c for a 0.5L bottle and 0.87c for a 1.5L
  • To make the calculation as realistic as possible, I will remove around €10M from the revenue to cover for variables such as income from sources such as syrup kegs that are purchased by restaurants, pubs and other similar outlets. These in fact do contribute to a significant proportion of the company’s revenue.
  • The rest is simple mathematics, where we see how GSD’s total revenue is made up from these single units. It is estimated that in 2013 GSD has sold 12.5M cans, 8.7M 0.5L bottles and 5.8M 1.5L bottles. This gives as a crude estimate of 17.2M litres of beverages being sold by GSD in 2013.
  • As such, GSD abstracted an estimate of 17.2 M litres of ground water in 2013, of which 6.9M litres came at no charge
Coca Cola wants us to share its products with friends, even though they want to monopolise public water sources to line their coffers

Coca Cola wants us to share its products with friends, even though they want to monopolise public water sources to line their coffers

But figures aside, GSD is now feeling the need to contribute to water conservation in Malta, through a recent announcement of an investment of approximately €575,000 by the Coca-Cola Foundation for water conservation measures in Gozo.

The issue here boils down to government enforcement once again. GSD claims that it adheres to all legal requirements in terms of water abstraction – so they are technically not breaking any laws. This operation appears to be sanctioned by the Maltese authorities, despite the fact that the Maltese government effectively stands to gain if GSD is made to pay for all the water it uses. Such an episode continues to verify how Maltese governments value money above the environment, supporting corporate entities at the detriment of the general public.

Ultimately, no matter how much money GSD throws at water conservation, they cannot reverse a situation in which the amount of groundwater abstracted surpasses the rate of recharge (the rate at which water is returned to aquifers after rainfall).  They should simply use the money they are investing in this sham of a conservation effort and pay for their water like other companies.

 

 

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