Economic Development News & Insight


World Bank report on rising water scarcity a wake-up call for North America

/ May 6, 2016

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World Bank report on rising water scarcity a wake-up call for North America

Life is dependent on water – and so is our economy. Every sector of the industry needs water. The agricultural sector needs water to grow produce. The energy sector needs water for cooling purposes. Manufacturing needs it for processing. Every single thing, product and service needs water.

That’s why the idea of any long-term water shortage is terrifying, but that’s exactly what’s happening in certain parts of the world. According to a recent report from the World Bank, the growing scarcity of freshwater could shrink many economies around the globe by mid-century, particularly in China and India.

The report states that Western European and North American economies will likely be spared but the study should be seen as a wake-up call for these countries to start measuring their water footprints and placing water preservation at the forefront. Otherwise, the alternative could be devastating.

Canada has roughly 7 per cent of the world’s renewable freshwater and its measurable contribution to the national economy can range anywhere from $7.5 to $23 billion per year. Droughts alone during 2001-2002, amounted to a total GDP loss of $5.8 billion.

In California, droughts cost the agricultural sector $2.2 billion in 2014.

Given that freshwater is a limited resource, some organizations are encouraging smart water use through education and innovation. People and businesses can measure water footprints of individual products and sectors, as well as find more information on innovation and water stewardship. People can also visualize their own water footprints by measuring the products they eat and use. For example, the banana I just ate took 160 litres of water to grow and it took 8000 litres of water to make my pants. I think it would be suffice to say that I have a new appreciation for water and that the World Bank report should ignite that same sense of value and urgent need to preserve water among North American economies and homes.

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