Water shortage to impact economic growth: World Bank -Governance Now

Water shortage to impact economic growth: World Bank

Water scarcity, exacerbated by climate change, could cost some regions up to 6 percent of their GDP, spur migration, and spark conflict, said a World Bank report

GN Bureau | May 5, 2016

#Asia #economic growth #World Bank #water scarcity #conflict #income

The combined effects of growing populations, rising incomes, and expanding cities will see demand for water rising exponentially, while supply becomes more erratic and uncertain, the World Bank report said.

It added that unless action is taken soon, water will become scarce in regions where it is currently abundant - such as Central Africa and East Asia - and scarcity will greatly worsen in regions where water is already in short supply - such as the Middle East and the Sahel in Africa. These regions could see their growth rates decline by as much as 6 percent of GDP by 2050 due to water-related impacts on agriculture, health, and incomes.

Water insecurity could multiply the risk of conflict. Food price spikes caused by droughts can inflame latent conflicts and drive migration. Where economic growth is impacted by rainfall, episodes of droughts and floods have generated waves of migration and spikes in violence within countries.

The negative impacts of climate change on water could be neutralised with better policy decisions, with some regions standing to improve their growth rates by up to 6 percent with better water resource management, showed the key findings of the report.

The World Bank report said that improved water stewardship pays high economic dividends. When governments respond to water shortages by boosting efficiency and allocating even 25 percent of water to more highly-valued uses, such as more efficient agricultural practices, losses decline dramatically and for some regions may even vanish.

In the world’s extremely dry regions, more far-reaching policies are needed to avoid inefficient water use. Stronger policies and reforms are needed to cope with deepening climate stresses.

Policies and investments that can help lead countries to more water secure and climate-resilient economies include: Better planning for water resource allocation, adoption of incentives to increase water efficiency, and investments in infrastructure for more secure water supplies and availability.

Read the full report here

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