Water shortages driven by climate change could cost some regions’ economies up to 6%.
They could not only impact their GDP but also spur migration and spark conflicts, according to a new World Bank report.
The ‘High and Dry: Climate Change, Water and the Economy’ report stated growing populations, rising incomes and expanding cities will see demand for water rising exponentially, while supply becomes more “erratic and uncertain”.
It warned unless action is taken, water will become scarce in regions such as Central Africa and East Asia where it is abundant and scarcity worsen in regions where it is in short supply such as the Middle East and the Sahel in Africa.
The World Bank added reduced freshwater availability and competition from other use, such as energy and agriculture, could reduce water availability in cities by as much as two thirds by 2050.
World Bank President Jim Yong Kim said: “Water scarcity is a major threat to economic growth and stability around the world and climate change is making the problem worse. If countries do not take action to better manage water resources, our analysis shows that some regions with large populations could be living with long periods of negative economic growth but countries can enact policies now that will help them manage water sustainably for the years ahead.”
According to the World Energy Council, a 40% shortfall of water across the globe by 2030 could severely affect power generation.