Food and water are two basic human needs. However, global coverage figures from 2002 indicate that, of every 10 people:
* roughly 5 have a connection to a piped water supply at home (in their dwelling, plot or yard);
* 3 make use of some other sort of improved water supply, such as a protected well or public standpipe;
* 2 are unserved;
* In addition, 4 out of every 10 people live without improved sanitation.
At Earth Summit 2002 governments approved a Plan of Action to:
* Halve by 2015 the proportion of people unable to reach or afford safe drinking water. The Global Water Supply and Sanitation Assessment 2000 Report (GWSSAR) defines "Reasonable access" to water as at least 20 liters per person per day from a source within one kilometer of the user’s home.
* Halve the proportion of people without access to basic sanitation. The GWSSR defines "Basic sanitation" as private or shared but not public disposal systems that separate waste from human contact.
Projected water distribution in 2025
As the picture shows, in 2025, water shortages will be more prevalent among poorer countries where resources are limited and population growth is rapid, such as the Middle East, Africa, and parts of Asia. By 2025, large urban and peri-urban areas will require new infrastructure to provide safe water and adequate sanitation. This suggests growing conflicts with agricultural water users, who currently consume the majority of the water used by humans.
Generally speaking the more developed countries of North America, Europe and Russia will not see a serious threat to water supply by the year 2025, not only because of their relative wealth, but more importantly their populations will be better aligned with available water resources. North Africa, the Middle East, South Africa and northern China will face very severe water shortages due to physical scarcity and a condition of overpopulation relative to their carrying capacity with respect to water supply. Most of South America, Sub-Saharan Africa, Southern China and India will face water supply shortages by 2025; for these latter regions the causes of scarcity will be economic constraints to developing safe drinking water, as well as excessive population growth.
Water supply and sanitation require a huge amount of capital investment in infrastructure such as pipe networks, pumping stations and water treatment works. It is estimated that Organisation for Economic Co-operation and Development (OECD) nations need to invest at least USD 200 billion per year to replace aging water infrastructure to guarantee supply, reduce leakage rates and protect water quality.
International attention has focused upon the needs of the developing countries. To meet the Millennium Development Goals targets of halving the proportion of the population lacking access to safe drinking water and basic sanitation by 2015, current annual investment on the order of USD 10 to USD 15 billion would need to be roughly doubled. This does not include investments required for the maintenance of existing infrastructure.
Once infrastructure is in place, operating water supply and sanitation systems entails significant ongoing costs to cover personnel, energy, chemicals, maintenance and other expenses. The sources of money to meet these capital and operational costs are essentially either user fees, public funds or some combination of the two.
But this is where the economics of water management start to become extremely complex as they intersect with social and broader economic policy. Such policy questions are beyond the scope of this article, which has concentrated on basic information about water availability and water use. They are, nevertheless, highly relevant to understanding how critical water issues will affect business and industry in terms of both risks and opportunities.
The World Business Council for Sustainable Development in its H2OScenarios engaged in a scenario building process to:
* Clarify and enhance understanding by business of the key issues and drivers of change related to water.
* Promote mutual understanding between the business community and non-business stakeholders on water management issues.
* Support effective business action as part of the solution to sustainable water management.
It concluded that
* Business cannot survive in a society that thirsts
* You don’t have to be in the water business to have a water crisis.
* Business is part of the solution, and its potential is driven by its engagement.
* Growing water issues and complexity will drive up costs.