Remarks by SM Tharman Shanmugaratnam at the Briefing by the Global Commission on the Economics of Water at the United Nations General Assembly

His Excellency, Mr Csaba Kőrösi, President of the General Assembly

Excellencies and Representatives of Member States

Thank you for this opportunity to brief you on behalf of the Global Commission on the Economics of Water, which I co-chair together with Ngozi Okonjo-Iweala, Mariana Mazzucato and Johan Rockström. I'm joined by María Fernanda Espinosa and Aromar Revi who are both colleagues of mine on the Commission.

The crisis of water: too much, too little or too dirty

We know we have a crisis of water, that is both local and global.

We see it in the record-making floods, droughts, heat waves and wildfires. In one nation or region today, another tomorrow.

Just look at the last year. From East Africa, suffering the consequences of a record four-year drought, leaving millions at risk of starvation; to Pakistan, where floods killed over 1,500 people and destroyed 45 per cent of the year’s crops; to China, which saw the worst heatwave in human history; and most recently to California, in the United States, hit by extreme storms after a record three-year drought in the very same region.

But it's not just these extremities of weather – too much or too little water - that we see that tells us there is a crisis. There is in fact a long-standing tragedy that doesn't make the headlines. Over 2 billion people not having access to safely managed water. One child under the age of five dying every minute because of diarrhoea, (because of) contaminated water.

So we know we have a crisis. But the bad news is that the crisis is going to get worse, in all these dimensions.

It’s not just putting at risk Sustainable Development Goal (SDG) 6 - not just our ability to achieve clean water and safe sanitation. Water is going to put at risk all the SDGs – from food security and health; to ending poverty and inequalities; to achieving gender equality (because women are the worst affected by the shortage of water in the developing world); to achieving trade for growth; and ensuring peace, within states, between neighbouring states, and globally.

We are seeing the consequences of having mismanaged water for decades. We haven’t protected the supply of water, we haven’t managed the demand for water to prevent its overuse, and foster its reuse. We have allowed for a growing imbalance between the demand and supply of water. It is estimated that by the end of the decade, we will see demand for water exceeding supply by 40 per cent – a huge gap in global demand and supply.

We have breached the planetary boundaries for water

Most fundamentally, as the science and evidence now tells us, we have altered the global hydrological cycle, and it is now having ramifications across the world, wherever we live. We have in fact breached the planetary boundaries for water, for the first time in human history. We have breached the boundaries that keep the Earth's system safe for humanity and for all life.

And dangerously, what we now see is the interaction of the water crisis with the climate crisis and the loss of biodiversity. They are reinforcing each other. Water is not just the first victim of the climate crisis, it is also a driver of the climate crisis. The loss of moisture in the soil and forests, for instance, is reducing their ability to sequester carbon. And it risks turning natural ecosystems from carbon sinks into carbon sources in the years to come, which will have devastating consequences for the pace of climate change.

So, we have a problem, because we have mismanaged water, and we have now breached the planetary boundaries for water. It has to be addressed with urgency. The current decade is critical. We have to take bold actions to restore balance in the global water cycle, to ensure that we achieve universal access to safe water, and enable water to support economic development and growth sustainably.

We have the capabilities and resources

The good news is that we do have what it takes to put water back on a sustainable track. We have the scientific knowledge. We have most of the technologies. We have the capabilities, and we can spread them globally. And we have the finance.

The task is to organise these capabilities and resources, locally and globally, so as to restore balance in the global water cycle, ensure every vulnerable group has access to safe and adequate water, and create a water future that helps achieve all our SDGs.

It requires that we reorient the governance of water, locally and globally.

Locally, this is not a task for ministers of the environment or water alone. It is a task for finance ministers too. It is a task for the whole of government, and in fact the whole of society.

Recognising the global water cycle as a global common good

And globally, we have to recognise what the science is telling us: that nations and regions are interconnected through the global water cycle. We have to treat the global water cycle as a global common good, to be protected and preserved in our own interests everywhere. It's in our collective interests. And we can only restore balance in the global water cycle if we take action collectively.

The complexity of the issue – in particular the wicked interaction of water and climate – should not deter us from moving swiftly. We have to guard against being daunted by the complexity of the issues, or waiting for a comprehensive, perfect solution. We cannot afford the perfect being the enemy of what is urgent and necessary.

Get moving on high potential solutions

We have to get moving. Focus on the high potential opportunities - where we have the technologies, and we can mobilise the resources.

Look at storage systems for water. We've neglected them, we've under-invested in developing and preserving them. We must address water storage holistically - first and foremost, by preserving natural ecosystems that account for the vast bulk of water storage, the wetlands for instance, and by complementing them with built infrastructure. That holistic approach is achievable, and critical to capturing every drop of rain and preserving it.

Second, reduce the extraordinary leakage in water delivery systems today. It's what’s called non-revenue water – that’s the technical term. There’s extraordinary leakage in municipal delivery systems even in the advanced world. There are many developed countries where 40% of water is lost in the course of delivery, through ageing infrastructure. The technologies exist, the management systems exist to reduce this.

Third, agriculture, the biggest user of water today and a hugely inefficient user. The technologies exist – drip irrigation, precision agriculture. We can make them affordable, spread them and help improve farmer’s yields at the same time.

Fourth, recycling industrial wastewater. We are not recycling the bulk of wastewater today, and the run-off is typically polluted, with large economic and social costs. Again, the technologies exist, we can spread them, and reduce the large wastage of water today.

And finally, we've got to move early to ensure that the transition to a low carbon economy – in particular, low emissions energies – reduces rather than increases pressure on water. If we don't plan this right, if we don't coordinate our strategies for water and climate, there's a very real risk that we exacerbate the water crisis, and ultimately hamper efforts to halt climate change.

Reorienting our economics and governance

Fundamentally, to make progress on these high potential opportunities, we have to reorient our economics and our governance. As I mentioned, it's a whole of government and indeed a whole of society effort within our own countries. It also means rethinking the economics.

We have to value water to reflect its economic value, and its broader ecosystem benefits. We have to value water so that it can be used more efficiently in every sector, so that it can be used more equitably in every population, and so that it can be used sustainably, locally, and globally.

Pricing water is key, and it is in fact helpful to the poor. It is water pricing, coupled with a system of targeted subsidies, that generates revenue to enable water systems to be invested in, maintained, renewed and extended across an entire population. It requires correcting today’s perverse subsidies in many countries – reflecting underpriced or free water – which benefit the better-off the most. In fact, in much of the developing world, subsidies for water largely benefit the well-off, not the poor. So we have to price water to encourage conservation across the economy, expand delivery systems to benefit the poor, and we've got to subsidise the poor, either through targeted social assistance or direct subsidies for water use.

The systems exist – my own country Singapore has been practicing water pricing for decades. Phnom Penh in Cambodia has also adopted water pricing successfully and seen the poor benefit. There are other examples around the world- Durban in South Africa and others.

Second, we have to reshape the way the public and private sectors interact. We are otherwise not going to be able to correct for the chronic underinvestment in water almost everywhere in the world, including the most advanced countries where the water infrastructure is aging. And we will not be able to invest at scale in water infrastructure in the developing world.

It requires a new relationship between the public and private sectors. We have had some bad examples of public-private partnership, but let's not let them distract us from the good examples of how we can structure contracts with appropriate distribution of risk and rewards between governments and private investors, and design regulation to provide certainty and ensure investments deliver benefits over the long-term. It can be achieved. We can and must mobilise private finance to serve the public good.

Next, we must develop, share, and drive down the costs of the technologies that, enable water to be equitably used and sustainably everywhere, including in the developing world. From the mature technologies – drip irrigation, for instance – to breakthrough developments in material science that can enable membranes to filter industrial wastewater with extremely high efficiency so much more of it can be reused.

We have to develop capacity globally: workforce capacity, decision-makers’ capacity, and to enable farmers and women to be at the frontline of water conservation. We have to develop this capacity through international cooperation.

We have to grow the role of multilateral and regional financial institutions in supporting water investments in the developing world, particularly at the time of high debts and higher interest rates. This is going to be critical in the coming decade. We must use the multilateral and regional financial institutions to multiply the capital received from their shareholders, by mobilising private finance. Achieving the global common good must involve additional financing for the developing world to develop water systems that are both sustainable and supportive of inclusive growth.

Finally, we have to strengthen global governance to achieve a sustainable and equitable water future.

If we are to make science a uniting force, as (President of the General Assembly) Mr Kőrösi said, we must first plug the huge gaps in data on water that exist today. We need better-quality data, with higher frequency, to enable early warning systems to be developed, and to enable us to adapt our decisions and identify our priorities as we go along. More fundamentally, we need a more holistic system of global governance for water, which is today fragmented and siloed. María Fernanda Espinosa will talk about this.

Turning crisis to advantage

In short, we can turn the water crisis to our advantage. They often say that necessity is the mother of invention. That has indeed been the case for water technologies. But it's not just the mother of invention. Necessity has to be the mother of good governance. Governance to ensure equity and justice through access to adequate and safe water and sanitation; governance to enable water to support rather than hinder or halt development and achievement of the SDGs; and governance to ensure a sustainable future for all of us, wherever we are. 

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