(Bloomberg) -- Mexico, the world's largest beer exporter, should stop making the drink in the north of the country as the region faces severe water shortages, President Andres Manuel Lopez Obrador said Monday.
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Citizens in large swaths of drought-plagued Monterrey, the country's industrial heartland where beermakers including Heineken NV have facilities, have suffered from water scarcity for months as dams have emptied out. Lopez Obrador said the government will support companies that want to produce beer in the south or southeast.
"This is not to say we won't produce any more beer, it's to say that we won't produce beer in the north -- that's over," Lopez Obrador said at a daily press conference. "If they want to keep producing beer, increasing production, then all the support for the south or southeast."
Read More: Taps Run Dry: Heat and Severe Drought Ravage Monterrey, Mexico
Alongside Heineken, Mexican beer giant Grupo Modelo, controlled by AB InBev, the world's largest brewer, has facilities in the north. Lopez Obrador cited the case of Constellation Brands as an example of what policy for one of Mexico's main industries should look like. The company had planned a beer plant in the border city of Mexicali, but in 2020 Lopez Obrador ordered that the project be stopped over water issues after a consultation with local citizens.
The company has since said it would build in the southeastern state of Veracruz.
"You can't give permits in places where there's no water," said Lopez Obrador, known as AMLO. "So, we're going to intervene and that's what the state is for."
Heineken and Grupo Modelo didn't immediately respond to requests for comment. Mexico's presidency didn't respond to a comment request seeking to expand on Lopez Obrador's remarks.
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