Unquenched thirst: There's no end in sight for the U.S.-Mexico water dispute. (Spotlight).

When U.S. President George W Bush called on Mexican President Vicente Fox in May to address Mexico's ballooning water debt to Texas, Fox pledged to find a solution.

But in the midst of a nine-year drought, Fox may have promised the impossible.

Opposition political parties and border-state governors quickly accused Fox of putting U.S. interests before those of farmers in northern Mexico, who have been struggling to survive.

Under a treaty signed in 1944, the United States is due 431 million cubic meters (350,000 acre-feet) of water each year from the Rio Bravo. But Mexico is well compensated, receiving 1.8 billion cubic meters from the Colorado River.

Nevertheless, Mexico has fallen behind in its obligations, which are tallied every five years. By this accounting method, Cristobal Jaime Jaquez, director of Mexico's National Water Commission (CNA) was able to tell a Senate water committee in early June that there currently is no water debt and Mexico has complied with the treaty.

That assessment is sure to change on Sept. 30, when the current cycle ends and the water books are balanced. By contrast, Mexico's water debt grew in April to more than 2 billion cubic meters, by U.S. estimates.

BOILING POINT

The scarcity of water along the border region has overflown into the political arena, most notably in Texas, which is in an election year, and where farmers recently staged a "tractorcade," blocking the Pharr-Reynosa border bridge, demanding water payment.

Meanwhile, in the face of pressure from abroad and disunity at home. Fox abandoned a self-imposed May 30 deadline for announcing his water solution. A June trip to Houston, Dallas, San Antonio and Austin was also put off until later in the summer.

Drought cannot explain away the water problem, according to U.S. officials, who say water is being wasted by Mexico's crude water distribution system, unauthorized irrigation and wasteful agricultural practices.

Mexico's water delivery system near the Rio Bravo wastes about 40% of what it delivers, according to Carlos M. Ramirez, the U.S. Section Commissioner for the International Boundary and Water Commission (IBWC), which regulates the terms of the 1944 treaty.

"The rain that Mexico has been getting on their side of the border is about 90% of normal," according to Ramirez, an engineer by training and former El Paso mayor. "So what we are asking Mexico to do is to prioritize water delivery (to the Rio Bravo). I mean, we're giving Mexico more water than they're giving us."

Indeed, Mexico's wasteful water infrastructure badly needs an overhaul, but even so, Texas farmers have branded suggestions that the United States provide Mexico with financial assistance for modernization, as blackmail.

DROUGHT PATROL

But updating Mexico's water infrastructure will require large-scale investment, according to Sen. Jeffrey Jones of Chihuahua, who surveyed Mexico's parched reservoirs from the air in late May.

"We're just going to have to go further with less water," Sen. Jones told BUSINESS MEXICO, adding, "In the state of Chihuahua, to make agriculture efficient, we're figuring US$400 million."

A rough proposal from Mexico's Environment and Natural Resources Secretariat has suggested investments of $1.5 billion pesos in the Conchos River basin over the next four years could create important water savings.

Prospective financial backers include the Border Environmental Cooperation Commission (BECC) and the North American Development Bank (NADB), both created under the auspices of Nafta to bolster the environmental infrastructure along the border.

The NADB has awarded US$379.1 million in grants and loans during its seven-year history--less than Fox's initial US$420 million request for assistance from the United States. The bank recently expanded its mission to include agricultural projects, but it cannot act alone. Designed to serve as a catalyst for outside investment, the bank's participation in an infrastructure project never exceeds 50%.

So, as debts pile up, and push comes to shove, so too the prospects of increased U.S. pressure on Mexico.

Ramirez met with U.S. State Department officials in May to discuss possible sanctions against Mexico.

"We're not ready to mention any of those because we're still negotiating with Mexico to find a plan," Ramirez said. "We're hoping that between now and September we can agree."

Morgan Lee is a Mexico City-based freelance writer and correspondent for the Albuquerque Journal.