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The global water risk snapshot

The global water risk snapshot

June 17, 2024

Exploring current and future water-related risks around the world

The Earth's water cycle is a delicate balance that ensures water is distributed across various ecosystems. But overconsumption, pollution, and climate change are disrupting that balance, and increasing water-related risks around the world.

A single water droplet falling on drought-stricken soil.
"Water risk is a global issue, but it manifests in diverse, hyper-localized ways. Communities and businesses must consider water-related risks in a local context..."
Portrait of Mathieu De Kervenoael
Partner
Paris Office, Western Europe

Water risk typically occurs when the demand for water exceeds supply, when poor water quality restricts its use, or during extreme weather events. It can take many forms but typically manifests as the depletion of water sources, flooding damage, or the degradation of water resources or aquatic environments.

Water risk can have a direct impact on communities, such as when cities face 'Day Zero' scenarios in which water supplies come close to depletion. However, water is also a strategic business risk . Water is essential across many industries, from agriculture to data centers, serving as a direct and indirect input that ensures business productivity. Shortages or declines in water quality have significant economic consequences, while floods destroy billions worth of assets each year. Companies operating in water-scarce regions face rising costs and decreased competitiveness.

Water risk is a global issue, but it manifests in diverse, hyper-localized ways. While some areas struggle with consistent drought conditions, others face unpredictable flooding risks or water quality concerns. Addressing these risks requires deep analysis that enables leaders to understand water in a local context – down to the site level and incorporating factors impacting the specific water basins on which they rely. The Global Water Risk Snapshot is designed to call broader attention to the increasing threat of water-related risks around the world. Utilizing publicly available data from multiple sources including the WWF Water Risk Filter, World Resources Institute Aqueduct Floods and local assessments, it provides a high-level indication of how water risks impact different parts of the world today – and where they could intensify in the future. While broad, the data can help illustrate where more drastic action may be required to improve water resilience.

Our analysis shows that water risk is set to intensify in water-stressed regions across all major risk categories – physical, regulatory and reputational. Looking broadly at physical risks, arid zones such as the Middle East and North Africa, the Southwest US, and India will experience increased water scarcity. Conversely, flooding will affect regions including the eastern US, China, and South America. Europe faces the most severe water quality problems, with a 93 % decline in freshwater fish populations since 1970.

Water scarcity is a growing global concern, especially in arid regions

Understood as the most tangible form of water risk, physical water risk factors primarily include water scarcity, increased flooding, and/or reduced water quality. Looking specifically at global water scarcity risks, the regions most impacted include the Middle East, North Africa, Sub-Saharan Africa, Central Asia, and parts of South Asia. However, high-risk levels are experienced in every major region of the world.

The Middle East and North Africa region faces severe water scarcity due to its arid climate, limited freshwater resources, and high population growth. Countries including Saudi Arabia, United Arab Emirates and Egypt rely heavily on desalination plants and underground water sources to meet their water demands. In Central Asia, countries such as Uzbekistan, Turkmenistan, and Kazakhstan face water scarcity due to the arid climate, overuse of water resources for agriculture, and inefficient irrigation practices. In South Asia, countries such as India and Pakistan face water scarcity due to a combination of factors, including population growth, inadequate infrastructure, and inefficient water management .

Addressing water scarcity in these regions and on a global scale requires sustainable water management practices , investment in infrastructure, and international cooperation.

Flooding risks to intensify, exacerbated by heavy rainfall, population growth and inadequate infrastructure

Riverine and coastal flooding and flash floods threaten urban and rural areas worldwide. However, some of the regions most impacted by flooding risks include Southeast Asia, South Asia, Central America, and parts of Africa.

Southeast Asia, particularly countries such as Indonesia, Vietnam, and Thailand, faces high vulnerability to flooding due to factors such as monsoon rains, low-lying topography, and densely populated river deltas. In South Asia, countries such as India, Nepal, Bangladesh and Pakistan also experience frequent flooding due to heavy monsoon rains, as well as inadequate drainage systems, and deforestation.

Central America is prone to flood risks due to its geographical location and exposure to tropical storms and hurricanes. Countries such as Honduras, Nicaragua, and Guatemala face the dual threat of heavy rainfall and storm surges, leading to flash floods and mudslides that can cause extensive damage to communities and infrastructure. Parts of Africa, including countries such as Nigeria, Sudan, and Mozambique, are also impacted by flooding risks. Factors such as irregular rainfall patterns, poor infrastructure, and inadequate urban planning contribute to the vulnerability of these regions.

Water quality is declining due to a combination of factors including agricultural runoff, industrial activity and urban development

Worldwide, agricultural runoff, particularly in areas with heavy fertilizer use, rapid urban development, and industrial activities all contribute to chemical and nutrient loading as well as increased biological oxygen demand (BOD) levels. These contaminants can result in harmful algal blooms, oxygen depletion, and degradation of aquatic ecosystems.

Water quality risks are found around the world, including in regions that are not as impacted by other physical risks factors, such as scarcity or flooding, as well as in regions with robust water legislation or relatively modern water infrastructure. For instance, the European Environment Agency reports that 60 % of Europe's rivers, lakes and other surface water bodies are not in good condition. In the developing world, untreated sewage or inadequate wastewater treatment systems also contribute to the contamination of rivers and groundwater sources and can lead to waterborne diseases and environmental degradation.

Addressing water-related risk requires sustainable management practices, technological innovations, and collaborative efforts to ensure the equitable and efficient use of the planet's most vital resource.

The Global Water Risk Snapshot calls attention to the increasing water risks around the world. Focusing primarily on physical risks in 10 different countries, our Water team explores how a variety of water-related risks manifest throughout the world today – and where they could intensify in the future.

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The global water risk snapshot

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Water-related risks are increasing globally. Explore current and future water-related risks in 10 countries around the world.

Published June 2024. Available in
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