By Charles Emmerson

Water is the most essential and most awkward of natural resources. It has no substitutes, but many uses - as drinking water, for sanitation purposes, in agriculture, in industrial processes, in electricity generation. Water's versatility makes it coveted by many different consumers, each with their own needs and political heft.

Sometimes water ends up not being water at all: it becomes an input to agricultural production or energy or, in the case of bio-fuels, both. In hydraulic fracturing, water is key to the extraction of natural gas. Elsewhere, it is needed to cool power stations. In southern Mongolia's bone-dry Gobi, water is needed for the region's huge mineral wealth to be developed.

Sometimes, the process works the other way, and huge amounts of energy and wealth are used to provide water. In California, it is the State Water Project, transporting water to southern California, that is the single largest user of electricity. In Saudi Arabia, up to 1.5 million barrels of oil per day are used to desalinate and pump the country's water.

Water's usability depends not only on sheer quantity, but also on quality and type. Water's most common form - ocean saltwater - is its least directly useful (though advocates of large-scale desalinisation and salt-water farming have long promised that could change).

The availability of water in both necessary quantity and quality depends, in part, on geography. Despite the overall global abundance of water, over one billion people live in water-scarce or water stressed parts of the world, a number expected to triple over the next few decades as groundwater depletion, climate change and accelerating demands on water extraction take their toll. Globally, the Water Resources Group has defined a forty percent gap between projected water requirements in 2030 and current accessible and reliable supply. In some places, the gap is much greater.

While some water resources can, up to a point, reasonably be thought of as renewable or effectively inexhaustible natural resource - like sunlight or air - the dynamics of other water resources in other places are more like those of oil. When an aquifer - so called 'fossil water' - is depleted, the water game is up.

To this heady mix, add one final factor: water's legendary volatility. Rainfall is erratic, and perhaps becoming more so. Even in relatively temperate countries such as Britain, our long experience of water can oscillate between extremes: in some cases, too little water, and in others, too much. With water, the only constant feature is inconstancy.

These are challenges with which water engineers have long grappled, attempting to manage water risk and boost supply. But as water becomes scarcer across the globe, its politics and economics have become more acute and more complex, for demand as well as supply. Achieving water security - in all its dimensions - has become a defining challenge for political survival and economic development, while companies will increasingly place investments where they see water risk reduced to a manageable level. Welcome to the new water politics of the twenty first century.

Take China: in just the last month, the most important emerging economy in the world has been confronted with both faces of water's ancient fickleness, and with the political and economic dilemmas this creates. The world is watching.

First came drought. In the first four months of this year, rainfall in the worst-hit central Chinese province of Hubei, home to the Three Gorges Dam, was forty percent lower than the post- 1961 average. Four million people faced drinking water shortages, river barges were left high and dry and millions of acres of cropland were affected.

Drought's consequences, however, were not limited to the agricultural sector nor to the primary water consumers of its central and southern provinces. The need to alleviate downstream drought forced officials to conduct an emergency release of huge volumes of water stored behind upstream hydroelectric dams - amounting to some 6.4 billion cubic metres since May. At a stroke, the electricity-generating potential of hydropower in China for 2011 was reduced, increasing the subsequent likelihood of power outages across the country. Should the agricultural impacts of drought force China to import more food, meanwhile, the effects would be global.

In mid-June, with a vengeance, rain returned. Again, Hubei was amongst the worst-hit. Drought turned to flood. Over one hundred people have since been killed by flooding and landslides across China. In the eastern province of Jiangxi the army was called in to help move some 122,400 people to higher ground.

Cycles of drought and flood are nothing new in China. The immediate crisis - bad as it is - will pass. But the long-term challenges of managing China's water will remain acute. As China's leadership increasingly recognises, how the country's water resources are managed - or mismanaged - will have a tremendous influence on both economic growth and on political stability. This is not just a China issue. It should be a subject of much broader concern.

The Twelfth Five-Year Plan (2011-2015), released earlier this year, placed environmental and resources challenges at its heart. Around the plan's publication, China's environment minister, Zhou Shengxian, wrote a startlingly frank essay arguing that "the depletion, deterioration and exhaustion of resources and the deterioration of the environment have become serious bottlenecks constraining economic and social development". Water availability has been explicitly recognised as a constraint on China's future economic growth.

But the problem is one of quality as well as quantity. Releasing China's annual State of the Environment Report in June, deputy environment minister Li Ganjie noted "social contradictions" caused by pollution. Over sixteen percent of China's rivers are considered to be grade 5 - unfit for agricultural irrigation. A clampdown on pollution is necessary. For some current water users it may be costly, too.

But this is not just about environmental sustainability, or even about economic development. As vice-minister Li hinted, the issue is wider still. Poor water quality could easily become a still-more live political issue in China, just as environmental issues became a focal point for dissent across Eastern Europe in the 1980s. The Chinese regime is acutely aware of this comparison.

Though some of the broad features of China's water situation are generic - the challenge of flood and drought control, the question of pollution and water quality, the political nature of water allocation and pressures of demand on supply - the Chinese example is, at some level, specific to China.

The precise water challenges of India, Brazil, the United States or Jordan - and their particular political and economic dynamics - are different. Water is embedded in specific hydrological, political and economic contexts.

But while water is often viewed as hyper-local, it is increasingly going global, too.

These days, water politics run from familiar questions of local access - the popular origin of the word 'rival' is from a Latin word denoting those who share the same stream - via the challenges of trans-boundary and regional water to the most global politics of all: around climate change and global trade. Climate change, a quintessentially global challenge, is affecting water availability across the world. For already water-scarce countries this amounts to an existential crisis.

Global trade, meanwhile, provides a mechanism by which 'embedded' or 'virtual' water - such as that in food production - is, in effect, traded internationally, sometimes from the water-poor to the relatively water-rich. (Some 77 percent of Japan's and 25 percent of Britain's overall water consumption is imported in this way).

At an only slightly less elevated level, some 265-odd water systems are already trans-boundary or regional. At a minimum, these require cross-border supervision. Even better would be treaty-based systems of management with agreed procedures for arbitration.

Often, however, suspicion and misinformation hover over these resources, even where management is good. In many cases, adequate data are not available. In some countries, they are secret. In other cases - such as between China and India, between India and Pakistan, in Central Asia, or amongst the riparian states of the Nile - deep-seated fears of a loss of water sovereignty can be allowed to fester, contributing to and feeding off a broader atmosphere of mistrust.

Played right, trans-boundary water resources - or unequal water resources - can provide a stimulus for cooperation or integration. A recent Chatham House Briefing Paper - Black Gold for Blue Gold: Sudan's Oil, Ethiopia's Water - suggested the Horn of Africa would benefit from a long-term deal to exchange Sudanese oil for Ethiopian hydro-electricity.

Played wrong, trans-boundary water - or unequal water resources - can be a source of mutual anxiety and tension. While the concept of 'water wars' may be overdone, national security sensitivities over water are acute.

In all cases, new uncertainties - climate change-induced water scarcity being the greatest - are likely to risk disturbing even long established patterns of cooperation. It should be no surprise to find, amongst the WikiLeaks haul of stolen American government documents, records of an Egyptian official, in 2009, expressing fear that a new riparian state on the Nile - South Sudan - might conceivably affect Egypt's water.

Nor is it hard to fathom the concern of the Indian political class when, in 2005, a former Chinese People's Liberation Army officer wrote a book entitled Tibet's Water Will Save China, raising the spectre of China damming the Tsangpo (Brahmaputra) river. In December 2010 Indian Prime Minister Manmohan Singh and Chinese Premier Wen Jiabao issued a communiqué that, amongst other things, promised to enhance trans-border river cooperation.

As befits water's awkwardly dichotomous nature, the solutions to the water challenges of the twenty-first century are neither exclusively global, nor exclusively local. But they are, perhaps, glocal.

Even where the practical solutions to water scarcity lie in local strategies of re-use, much better demand management, water pricing or improved infrastructure, the tremendous financing needed for some of these strategies often lies at the global level - with global development organisations, with institutions such as the International Finance Corporation or the World Bank, or with global capital markets.

Global organisations can help support local, transboundary, or regional solutions by supporting government capacity and providing legal support. Global information sources - such as those fed by remote sensing - can overcome informational asymmetries or mistrust at the local level. Global action on climate change, meanwhile, could help reduce the primary risks of water scarcity, increased uncertainty around future water availability and actual volatility of water availability (and attendant flood and drought risk) resulting from climate changed weather patterns. Organisations such as the G20 have a role to play on water security issues. Water should be a key item on the Rio+20 agenda in 2012.

The twenty-first century need not be a century of instability, conflict and uncertainty around water. The technologies, information and capital to manage water resources sustainably and cooperatively are all available, representing a huge opportunity for high economic returns and political cooperation. Water coalitions - from community-level engagement to public-private partnerships at the global level - are under construction. In the end, while water will continue to fascinate, perplex and disrupt in equal measure, it must also continue to provide the basis for sustainable economic growth and development for all.

(Charles Emmerson is a Senior Research Fellow with the Energy, Environment and Development Programme at Chatham House, and the author of The Future History of the Arctic (Vintage 2011).)


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