Urgency in Addressing the Global Water Crisis: A Call for Collective Action

Key Fact:

If current trends continue, water shortages could reduce global cereal production by 23% by 2050, threatening food security for millions.

Attachments

Executive Summary - Economics of Water

For the first time in human history, the hydrological cycle is destabilized. Water scarcity, pollution, and mismanagement threaten not only the planet’s ecosystems but also the fundamental well-being of societies across the globe. Despite decades of warnings, the world now stands on the brink of a severe water crisis that transcends borders and affects virtually every sector of human activity.

Governments, businesses, and communities must act with greater urgency and cooperation to mitigate this crisis and safeguard future generations. Failure to do so will result in catastrophic economic and environmental consequences, further exacerbating inequalities and undermining food security, health, and human dignity.

Water Crisis by the Numbers:

• 1,000 children under five die every day from diseases linked to unsafe water.
• Nearly 3 billion people and over half of the world’s food production are now in regions projected to experience critical water shortages.
• 50-100 liters of water per day are required to meet basic health and hygiene needs, but a dignified life demands 4,000 liters per day—a target most regions cannot achieve locally.

Global Economic and Environmental Costs:

The economic impacts of water scarcity are enormous. If current trends continue, high-income countries could see an 8% decline in GDP by 2050, with even steeper reductions of 10-15% in low-income nations. The agricultural sector, which consumes about 70% of global freshwater, is particularly vulnerable. A 23% reduction in global cereal production is forecasted if water shortages are not addressed, threatening food security and exacerbating global hunger.

Moreover, deforestation, the loss of wetlands, and the degradation of “green water” (the moisture held in soil and vegetation) are intensifying climate change by depleting critical carbon stores. As the hydrological cycle becomes increasingly erratic, societies face more frequent droughts, floods, and wildfires, compounding environmental and economic challenges.

A Call for New Water Economics:

The Global Commission on the Economics of Water stresses the need to treat water as a global common good. This new approach would align global water policies with sustainable development goals, ensuring water is valued and managed effectively across borders.

Key reforms include:

• Proper Valuation of Water: Correctly pricing water based on its scarcity and significance is crucial. This will incentivize efficient use and investment in water-saving technologies.
• Governance Reforms: Water governance must operate locally and globally, incorporating more equitable and sustainable management practices.
• Investment in Innovation: Public and private sectors must collaborate to invest in water-efficient technologies, focusing on circular economies and regenerative water use in agriculture.

Five Critical Missions to Restore Water Security:

The report outlines five key missions that must be achieved to restore balance to the global water cycle:

1. Revolutionizing Food Systems: Increase water productivity in agriculture to feed a growing population while conserving water.
2. Conserving Natural Habitats: Protect vital ecosystems that sustain water cycles, particularly forests and wetlands.
3. Circular Water Economies: Reduce water waste through recycling and efficient industrial practices.
4. Low Water-Intensity in Clean Energy: Develop clean energy and AI technologies with lower water footprints.
5. Safe Water Access for All: Ensure no child dies from unsafe water by 2030.

What’s Next?

The global water crisis is not just an environmental challenge—it’s a threat to humanity’s future. Without bold, immediate action to reform how we value, manage, and govern water, the consequences will ripple through every aspect of life, from food security to economic stability and climate resilience.

However, this crisis presents a unique opportunity: by transforming our relationship with water, we can drive innovation, ensure equitable access, and build a more resilient and sustainable world.