0.18 Natural capital: water  (Page 7/11)

Table 18-3 displays the very wide difference in water prices for households. Clearly the lowest prices are found in emerging nations. Among emerging nations only those for Brazil and Colombia were above $2.00 per m ³ . Water prices in Cairo in 2013 were less than 2% of that for Denmark. Note the very low price in oil-exporting Nigeria, where consumption of fossil fuels is also heavily subsidized. Prices in water-needy Delhi were but 4% of that charged by Atlanta. For rich nations such as the U.S., water prices vary by region: high in Atlanta and very low in Miami. Of the cities in the table, only Dublin in Ireland charged a zero price for water in 2013.

Water issues are truly critical for the world’s poorest nations. Both in urban and rural areas, access to clean water was, by 2006 not available to large proportions of the population. In urban areas, there are a dozen countries where access to clean water is available to only 75% of the people. These include Angola, Somalia, Nigeria, Yemen and Haiti. In rural areas the problem is even worse. These are nine nations where clean water is available to less than 1/3 of the people (Somalia, Mozambique, Nigeria etc.). Little wonder 2 million children and millions of adults a year die from water-borne diseases.

Earlier we noted that only 2% of earth’s water is freshwater, but 70% of that is frozen in glaciers and ice caps. So, animals, humans and plants have about 0.75% of total water to live on and most of this is underground , in aquifers or similar formations. The rest is falling as rain, sitting in lakes or reservoirs or flowing in rivers.

There has been a water crisis developing for decades. Why was so little attention paid to it until very recently? Because so much has changed.

As late as 1950, the world’s population was only 2.5 billion. Concerns over water supplies then affected far fewer people.

Then in the past 60 years, the world experienced:

• The Green Revolution, an inspired combination of hybrid seeds, fertilizers but more water utilization for new varieties.
• The earth’s population rose to 7 billion in 2010, and should reach 9 billion by 2050 even though fertility rates are falling worldwide (except in the Mideast). This is the momentum factor (see Chapter___).

As a result, the amount of land under irrigation has doubled in 60 years but the amount of water drawn for agriculture has tripled.

We have seen that a wide variety of developed and developing nations have deeply underpriced household water. Water for agricultural use is also priced well below that for household and industrial use, as is evident in Figure 18-3 . This is as true in developed as in emerging nations. Water prices for agricultural use are near zero in emerging nations. Water for agriculture costs more than $1 per m ³ only in Netherlands and Austria. For the U.S., France, Greece, Spain, Hungary, U.K. and Portugal water for agriculture costs less than 10c per m ³ . It is apparent that incentives for conserving water for agricultural uses (primarily irrigation) are virtually absent, except perhaps in the Netherlands and Austria. Therefore, the growing scarcity of water should come as a surprise to no one.