Election-year water crisis taking a toll on Brazil's economy

viernes 31 de octubre de 2014 11:08 GYT

By Caroline Stauffer

SAO PAULO Oct 31 (Reuters) - After a grueling election campaign in which officials faced fierce criticism for downplaying the effects of a year-long drought, Brazil's most populous state is finally coming to terms with an uncomfortable reality: it is running out of water.

São Paulo state accounts for a third of Brazil's economy and 40 percent of its industrial production, and the water crisis is already crimping factory and farm output as well as the service sector in a stagnant economy.

"There is absolutely no doubt that this is having an impact on industrial production," said Nelson Pereira dos Reis of the São Paulo state industry association Fiesp, which hasn't yet quantified the economic impact.

Hit by Brazil's worst drought in 80 years, the two main reservoirs serving metropolitan São Paulo, South America's largest city, could dry out by February if relief does not arrive in the upcoming rainy season.

Even if rains return to normal levels, which forecasters don't expect anytime soon, it may take four or five years to reach comfortable levels.

The drought has prompted soul-searching in resource-rich Brazil, which has the world's largest renewable fresh water supplies and yet repeatedly grapples with water and energy crunches caused by dry spells.

Critics say the pattern shows a general lack of planning in a country that has long struggled to live up to its economic potential.

Critics say São Paulo's state government, controlled by the opposition party that just lost Brazil's presidential election, failed to impose fines or other measures aimed at curbing water use earlier in the year out of fear of alienating voters with unpopular measures.   Continuación...