Water is the ultimate renewable resource, but global water supplies are becoming less reliable amid dangerous floods, droughts and threats to agriculture.
A new era has begun of "global water bankruptcy,” with humans depleting freshwater systems to the point they can’t recover, according to a United Nations report last week.
Three-quarters of the world’s population — about 6.1bn people — now live in countries where freshwater supplies are insecure or critically insecure, according to the report, published by UN University’s Institute for Water, Environment and Health.
Around 4bn people experience severe water scarcity for at least one month each year, while drought impacts cost an estimated $307bn annually.
The UN report defines water bankruptcy as a "persistent over-withdrawal from surface and groundwater relative to renewable inflows and safe levels of depletion” with "irreversible or prohibitively costly loss of water-related natural capital”.
This differs from water stress which reflects high-pressure situations that remain reversible or a water crisis, which is used to describe acute shocks that can be overcome. Drought and water scarcity are likely to drive migrations in parts of Sub-Saharan Africa, South Asia and Latin America, says the report.
Cities are experiencing more Day Zero events in which municipal water systems near collapse. An acute water shortage in Tehran recently led authorities to warn it may become necessary to evacuate parts of the city or even relocate the capital.
Climate change is shifting fresh water on a planetary scale and, on a smaller scale, those effects can be made worse by local actions. A hotter, drier planet experiences more water-evaporating droughts. That concentrates salts in the soil, as so do certain farming practices.
A paper published this month in ‘Nature’ predicted that crop droughts will worsen in much of Europe, northern South America and western North America even as big rain events increase. That’s because rising temperatures more strongly affect evaporation and loss of soil moisture in those regions, which means more water will be required for irrigation.
In late 2020, the Chicago Mercantile Exchange launched the first water futures market. Water then joined gold, oil, and other commodities traded on the Wall Street. Apart from being a tradable contract, the futures launch also highlighted growing worries that the life-sustaining natural resource is becoming scarce across of the world.
Proponents of the market say that the futures contracts will function more like insurance. But the United Nations had warned in late 2020 that water futures risked an essential public good being treated like gold and oil, leaving the market vulnerable to speculative bubbles.
The Middle East and North Africa (Mena) region has the world’s scarcest supplies of water, and more than 60% of the people in Mena nations live under conditions of high or very high water stress, according to the World Bank.
Higher GDP and population growth levels, as well as the increasingly hot climate, mean the Gulf countries need to spend heavily to meet their energy needs.
Water is becoming a significant geopolitical risk, as scarcity and unequal access to water contribute to rising political tensions when demand exceeds supply.
However, when access to water is managed equitably and transparently, it can become a powerful catalyst for socioeconomic growth, co-operation and peacebuilding, fostering cross-border collaboration and contributing to long-term stability.
The UN report calls for the recognition of water bankruptcy in policy debates, and for the creation of a global monitoring framework to track water resources, while governments should consider blocking projects that further degrade water supplies.
In July 2010, the UN General Assembly declared access to water and sanitation as a human right, with its sixth Sustainable Development Goal being access to clean water and sustainable sanitation for all by 2030.