Reforming water economics and governance

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Locks are seen on the old Navajo Bridge over the Colorado River in Marble Canyon, Arizona, amid the drought and water shortages plaguing the country. (Photo: AFP)

The floods, droughts, heat waves and fires that are devastating many parts of the world underscore two fundamental facts. First, damage to freshwater supplies is increasingly straining human societies, especially the poor, with far-reaching implications for economic, social and political stability. Second, the combined impact of today’s extreme conditions is unprecedented in human history and beyond the ability of policy makers to react.

In East Africa, a devastating four-year drought has destroyed millions of livelihoods and left more than 20 million people at risk of starvation. In Pakistan, recent floods have submerged a third of the country, killing at least 1,500 people so far and wiping out 45% of this year’s crops. In China, an unprecedented heat wave has caused severe water shortages in areas that account for a third of the country’s rice production.

Additionally, droughts and fires in the United States and Europe, as well as severe floods and droughts across India, have reduced global grain yields and food exports, underscoring how dependent our food production is on volumes. of significant and stable water. Add to this the impact of the war in Ukraine on grain and fertilizer supplies, and there is a substantial risk that the current global food crisis will persist.

For the first time in our history, human activities are endangering water at its very source. Climate change and deforestation are altering the monsoon season, causing ice to melt on the Tibetan Plateau and affecting freshwater supplies for over a billion people. Rising global temperatures are changing evaporation patterns and reducing moisture return from forests, disrupting downwind precipitation. And a destabilized global water cycle is itself aggravating climate change. For example, water depletion in soil and forests reduces their ability to sequester carbon.

Water use restrictions, power cuts and other palliative measures can no longer mask the fact that our water governance and management systems are not adapted to a world of radical environmental change. All of our current arrangements are based on the now invalidated assumption that the water supply is relatively stable (within the limits of natural variability), predictable and locally manageable. But the water crisis is global and can only be solved with transformational thinking and new governance.

We must recognize that all of our major environmental challenges are related to water – whether there is too much or not enough, or whether it is too polluted for human use. The task now is to understand the links between water, climate change and biodiversity loss, and to properly define, value and govern water as a global commons. Thinking about water this way will allow us to mobilize collective action and design new rules that put equity and justice at the center of our response.

For too long, most governments have either ignored market failures or responded to them with quick fixes, rather than mobilizing the public and private sectors around common ambitions. The public sector must see itself as a market shaper that works with all stakeholders in the water economy to create pathways for innovation and investment, ensure access to clean water and sanitation, and providing enough water for food, energy and natural systems.

A key lesson from past challenges that required systemic innovation is that a clearly defined mission is needed to organize our efforts. Mission-oriented policies allow governments to direct innovation and know-how directly towards the achievement of critical objectives. When guided by an inclusive “common good” approach, they are uniquely able to provide solutions to challenges that require enormous levels of coordination and funding over many years. Climate change, biodiversity loss and water crises are precisely such challenges.

Mission-based strategies can help governments innovate with purpose, direction, and urgency. But to be effective, policy makers must heed the experience and wisdom of ordinary citizens, communities and innovators who know how to thrive in a world of water scarcity, higher temperatures and coastal systems and modified rivers.

We must now recognize the threats to the global freshwater system and translate our awareness into collective action. Because water scarcity will jeopardize all other Sustainable Development Goals, it should reinforce our collective will to limit the rise in temperatures to 1.5° Celsius above pre-industrial levels (as specified in the agreement of Paris sur le climat), and to preserve the natural systems that ensure stable rainfall and runoff patterns.

To meet these global challenges, we must embed the principles of fairness and justice in any new arrangements we design. No community can thrive without a reliable supply of clean water. But safeguarding this global common good requires new policies and new systems.

Both law and economics need to be reoriented to ensure universal access to clean water, sanitation and hygiene, and to build more resilient and sustainable food systems. Incentives must change so that the private sector can do its part to provide access to technology and innovation in poor and rich countries alike. This will require long-term funding and new mechanisms to regulate how the public and private sectors work together.

The 2023 UN Water Conference – the first in nearly 50 years – will be a pivotal moment for the international community to begin charting a future that works for everyone. To prepare for this, we can take inspiration from Nicholas Stern, who rewrote the economics of climate change, and Partha Dasgupta, who rewrote the economics of biodiversity. As four co-chairs of the World Commission on Water Economics, our goal is to transform the global understanding of water economics and governance, with much greater emphasis on equity , justice, efficiency and democracy.

We can still redefine our relationship with water and rethink our economies to value water as a global common good. But the window of opportunity is closing. To have a chance of averting climate catastrophe and adapting to the inevitable changes, we must secure a water-resilient future for poor and rich societies.©2022 Syndicate Project


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