The Coke Machine - Michael Blanding [81]
Anecdotally, Arana says he has seen a steady increase in obesity and diabetes in the communities he serves. Official evidence, however, is hard to come by. While government statistics show Chiapas has the highest rates of obesity in the country, for example, it has one of the lowest rates of diabetes, which Arana says is due to an underdiagnosis of the disease. Compounding the problem is the lack of safe drinking water at homes and schools in highland communities. “The teachers know this and sometimes they are convinced by Coca-Cola to promote the consumption of soda in schools among the children,” says Arana. As in the United States, many schools still have exclusivity contracts with Coke or Pepsi—and despite phasing out sugary beverages in schools in the United States, they are still frequently sold here. “They do in other countries what they would not do in the United States,” sighs Arana, a statement that represents a lot about Coke’s strategy around the world. Because the company’s franchise bottlers aren’t directly owned by the company, they don’t have to live up to the same standards.
In addition to contracts in schools, Coke also drives up soda sales by selling beverages for a cheaper price in indigenous communities. In the city of San Cristóbal de Las Casas, for instance, a liter of Coke sells for 10 pesos (about 90 cents), while just up the mountain in Chamula it is sold for half that. In the same shops, a 1.5-liter bottle of Coke’s water brand Ciel costs 10 pesos, making Coke actually cheaper than its main ingredient. The most logical explanation for the difference is that the company is hoping that the taste for sugar will result in more sales over time.
Arana is part of a group of doctors who pushed for a soda tax to curb consumption nationwide. In 2002, in fact, the country imposed a 20 cent tax on all soft drinks made with high-fructose corn syrup, affecting Coke and Pepsi but not local sodas made with sugar from sugarcane. (The rumor persists that Coke in Mexico is made completely with natural cane sugar, which the Coca-Cola Company does nothing to dispel. However, that hasn’t been the case for a decade, since the North American Free Trade Agreement flooded the market with cheap corn, and Mexican bottlers began using cheaper HFCS. In past years, Coca-Cola FEMSA has used up to 60 percent HFCS in Mexican Coke. By 2009, that ratio was down to 30 percent, but with plans to raise it because of an increase in sugar prices.)
When the tax was passed, however, the United States promptly filed a dispute on Coke’s behalf in the World Trade Organization (WTO), arguing it was discriminatory against American products. The WTO ruled in the favor of the United States in 2005 and again in 2007, after which Mexico repealed the tax. An effort by Mexican president Felipe Calderón to impose a 5 cent tax on all soft drinks failed in the legislature, amid heavy lobbying from soft drink companies. Arana is hopeful that in the future another tax might succeed—or if not, then at least the government might be able to pass a law outlawing the selling of soft drinks at different prices, or prohibiting exclusive school beverage contracts.
The health issues surrounding soft drinks, however, are not the only issues here that have led to a backlash against the company. Down the mountain from Chamula and the highland villages, residents of the city of San Cristóbal have raised questions about how the company produces the drinks themselves.
Geckos scamper underfoot during the steep climb up Huitepec, a dormant volcano on the outskirts of San Cristóbal de Las Casas. The path weaves its way through a forest of ancient-seeming oak trees, all twisted trunks and gnarly burrs with moss and vines clinging to their sides. It’s