In China, 70% of lakes and rivers have been polluted by power plants and chemical, paper, and textile factories. As a result of these industrial and agricultural expansions, Chinese consumers are concerned about water quality. They’re turning to bottled water as a safer alternative and that’s boosting Nestlé’s bottled-water sales in China. Sales of bottled water in the country will climb to $16 billion by 2017, up from $9 billion in 2012, according to Euromonitor.
As we have discussed on this blog, pollution treatment and cleanup techniques are costly. The water pollution and influx of foreign bottled-waters raise the free-rider problem.