Encarna Esteban
Full Professor of Economic Analysis at the Faculty of Social and Human Sciences of the University of Zaragoza
The report The economics of Water: Valuing the Hydrolical Cycle as a Global Common Good (GCEW Executive summary) highlights the need to achieve collective management of the water cycle. Water is one of the essential natural resources and is currently subject to a severe crisis where scarcity of this resource is the fundamental pattern. Water scarcity, together with an increased incidence of extreme natural effects such as droughts, is having a strong impact on human health, food security and economic growth, as well as strong impacts on ecosystems. The lack of global management and overexploitation of this resource has led to a further aggravation of the water crisis.
One of the main ideas of the report is the need to manage this resource in an integrated way through global governance. It is essential to treat the resource as a common good with innumerable services (positive externalities), which need to be properly valued and taken into account in water management. The GCEW identifies five key missions to achieve sustainable water governance and reduce the current water crisis:
- Mission 1: Improve water productivity to reduce impacts on water quality and quantity. Ensuring food security must be accompanied by efforts to avoid deterioration of water resources.
- Mission 2: internalising the many goods and services provided by water and its associated ecosystems in water management.
- Mission 3: enhancing the circular water economy by reusing resources and reducing inefficiencies (e.g. losses in networks).
- Mission 4: new growth patterns based increasingly on the use of renewable energies or artificial intelligence must not compromise the sustainability of this resource.
- Mission 5: improve sanitation and purification systems to ensure access to safe drinking water in all regions (avoid deaths from unsafe water).
The challenges are numerous, but the creation of a new water economy with the support of different governments and institutions is essential. The current water crisis requires global governance to address the remaining challenges.