This article is based on content originally published on our partner platform Seerist, a Control Risks company.
The 10th World Water Forum took place in Bali, Indonesia between 18-25 May. Based on current trajectories, 2024 is very likely to see more water management-related security incidents globally compared with the past five years.
- The average monthly number of security incidents (war, unrest, terrorism and crime) in relation to water has increased by over 230% between Jan 2019 and May 2024.
- Conflicts over water are likely to increase globally in the coming years, driven by heightened competition for water resources amidst rising temperatures and more frequent extreme weather.
- Water scarcity and pollution are already catalysts for activism worldwide and this trend is likely to grow, particularly in countries with well-established environmental movements.
- In countries with extreme and high water stress levels, businesses are likely to be increasingly exposed to government water management regulations.
Daunting numbers
The World Water Forum is an international event (taking place every three years since 1997) that brought together stakeholders from around the globe to discuss and develop solutions for water-related challenges. The forum does not create binding international regulations. In a welcome message for the event, Indonesian President Joko Widodo said: “Sustainability of water resources has become a pressing issue for the world.”
Seerist data highlights the importance of the intersection between water and security. The average monthly number of security incidents (war, unrest, terrorism and crime) in relation to water has increased by over 230% between 2019 and May 2024. As climate change continues to stress water resources globally, the overall pace of water-related security incidents is unlikely to slow in the second half of 2024. In fact, this year is very likely to see more water management-related security incidents compared to the past five years.
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The current trajectory follows a steady and significant increase in security incidents related to water management over the past few years. Seerist has already recorded 412 incidents in relation to water as of 20 May 2024,, compared with 273 for all of 2019. Most of these incidents include protests and violent unrest linked to water shortages or pollution, as well as crime in relation to water management.
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Other data and research confirm the trends Seerist data shows in relation to water:
- The Water Conflict Chronology by the Pacific Institute recorded 213 conflicts over water resources between 2000 and 2009. For the decade that started in 2020, the Water Conflict Chronology counted 543 conflicts so far – an increase of 154%.
- 31% of global GDP will be exposed to high water stress by 2050, according to August 2023 data from the World Resources Institute.
- Half of the global population already faces severe water scarcity during some part of the year, according to the UN's 2024 World Water Development report.
- A quarter of the world's population is utilising over 80% of their annual renewable freshwater supply, according to the same UN report.
- Sub-Saharan Africa is expected to experience significant water demand growth, projected to rise by 163% by 2050, according to the World Resources Institute.
- Studies referenced in the UN's 2024 World Water Development report state that 10% of the global increase in migration can be attributed to water deficits.
Water and security risks
Water has long been a key driver of wars internationally. Recent examples of conflicts where water resources played a significant role include:
- Border clashes between the Taliban-ruled Afghanistan and Iran over access to the Helmand River in May 2023.
- Border clashes between Kyrgyzstan and Tajikistan in January 2022 over border demarcation and water resources.
- There have been longstanding diplomatic tensions between Egypt, Sudan and Ethiopia over water resource of the Blue Nile River and Ethiopia’s Grand Ethiopian Renaissance Dam (GERD).
- Ongoing diplomatic tensions over use of the Tigris and Euphrates rivers between Turkey and Iraq.
- Geopolitical rivalry between India and Pakistan is also connected to disputes over the Indus Waters Treaty, which was originally signed in 1960.
Conflicts over water resources are likely to increase globally in the coming years, driven by heightened competition for water resources amidst rising temperatures and more frequent extreme weather events, such as floods and droughts. Countries with high water stress levels are particularly exposed to such conflicts.
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Water and reputational risks
Water scarcity and pollution are already catalysts for activism worldwide and this trend is likely to grow, particularly in countries with well-established pro-environmental movements. Companies engaged in water management are most likely to be targeted by activists and protesters. However, other businesses could also face increasing opposition for their water management plans. For example, in France there is an ongoing campaign by environmental activists who oppose the construction of two large water basins near Clermont-Ferrand, which are intended to support grain farmers working for Limagrain, a multinational wheat and corn company. In Germany, activists have set up a protest camp and tried to storm a factory on 10 May 2024 in opposition against US-based automotive company Tesla’s water management plans for a factory near Berlin. Water management has also been a key driver for activism in Mexico (farming), and Chile (mining). Seerist has also recorded a significant amount of unrest incidents in relation to water sources in India, Iraq, South Africa, Iran, and Tunisia over the past years. Sectors exposed to reputational risks in relation to water management include farming, manufacturing, mining, construction, data centres and energy.
As water is likely to become a significant driver of activism in the coming years, campaigners will increasingly target companies with investments in the water industry – a strategy that is already well established in the pro-environmental activist scene. Increased social pressure could also lead to occasional delays in obtaining environmental licences and permits.
Water and regulatory risks
In countries with extreme and high water stress levels, businesses are very likely to be increasingly exposed to government water management regulations. Most of these interventions will come in the form of water rationing plans, particularly during acute droughts. Recent examples of such water rationing measures include India, South Africa, Australia, Chile and the US state of California.
In 2023 and early 2024, several US states, China, South Africa, India, Spain and Brazil introduced water management regulations to ease both water shortages and pressure on groundwater sources. Heavy industry, data centres, and farming will be particularly exposed to such regulations in the coming years. Businesses should also consider that wealthier countries are more likely to react effectively to water management challenges.
Even as new technology will improve water management in some countries and offer significant opportunities (US businessman Elon Musk highlighted the growing efficiency of desalination at the World Water Forum), such improvements are likely to be unevenly distributed globally. Countries and companies that can afford new technology will benefit the most As climate change adds further stress to global water sources, companies should prepare for water pollution and scarcity to emerge as critical security and geopolitical risk drivers in the coming years.