Defining the Geopolitics of a Thirsty WorldSM
ISIS Wages The World’s First Water War

Via the Wall Street Daily, a look at water crises in the Middle East:

Water War Waging in the Middle East: ISIS at the Front

“Water is the single most important determination of civilization.”

Famed international and commodities investor Jim Rogers said that in an interview with marketing agency Sinclair & Co. And he’s right…

History shows that no civilization can survive without water – no matter how advanced.

Earlier this year, the Journal of the American Water Works Association identified a number of countries that are experiencing water stress. These countries include the emerging market giants China and India, parts of the United States, and many countries in the Middle East, including Egypt, Jordan, Syria, Iraq, Yemen, and Turkey.

Other countries not identified in the journal are experiencing water stress, too. In Pakistan, for example, water per capita is at a rate of only 1,500 cubic meters. That’s one-third of the rate it was in 1950, which was 5,000 cubic meters.

And then there’s the growing water problem in Brazil.

Conditions around the world are likely to get worse, too, as global water consumption is forecast to rise by 85% by 2035.

The New Liquid Gold

In his interview, Jim Rogers talked specifically about some of the world’s water trouble spots, which doesn’t necessarily mean a lack of water.

For instance, in China, Rogers pointed out that the water is often polluted and also in the “wrong place.”

You see, half of the country’s population and two-thirds of its farmland are in the north. But 80% of the country’s water is in the south. Plus, about 70% of the groundwater that’s in the north is too polluted for the industry to even use.

The water problem is India may even be worse, according to Rogers.

In the northwestern breadbasket of India, about 80% of the surface water is being used. That’s led groundwater levels in some areas to drop by 54% just in the past seven years. Forecasts are predicting that 60% of India’s aquifers will be in “critical condition” within 20 years.

Pollution is a big problem in India, too. Only 59 of India’s 632 districts have water safe enough to drink.

Yet, neither China nor India hold a candle to Roger’s biggest concern – the Middle East.

Water Terrorists

There, Rogers is forecasting that wars will start – especially in the western part of the region – over water.

The Arab region contains less than 7% of the world’s water reserves and less than 1% of the world’s flowing water. The region’s rainfall never exceeds 2% of the global average.

And it seems that Jim Rogers’ prediction has already come true… The first water war is already well underway.

I’m taking about the spread of ISIS.

The writing was on the wall as early as 2013 when ISIS tried to seize rivers and dams in Syria and Iraq.

Mahmoud Abu-Zeid, President of the Arab Water Council, told the Middle Eastern media site Al-Monitor, “ISIS expansion has become concentrated in water resource regions in Syria and Iraq, and it is very clear that ISIS is seeking to acquire parts of Arab water sources.”

He went on, “Given that water represents life, seizing such resources in Arab countries would be very serious and would constitute an inhumane means of pressure.”

ISIS already controls most of the upper areas of the Tigris and Euphrates Rivers. And its agreement with Nigeria’s Boko Haram creates the possibility that ISIS will gain control of the headwaters of the Nile River.

Tensions are rising in other areas, as well.

There’s already tension in this region between Egypt and Ethiopia over the Nile. And tension between Egypt, Libya, Chad, and Sudan over a shared aquifer. Plus, the civil war in Yemen grows hotter as water becomes scarcer.

The water situation will likely grow worse as ISIS and similar groups gain strength.

Water, Water Everywhere

The problem is that water isn’t evenly distributed around the planet. As Rogers points out, there’s plenty of water in Siberia, for instance, but few people live there.

So, is there an investment angle to this?

Well, certain areas of the water sector may provide some opportunity.

For instance, to treat contaminated waters in Asia, there are a number of companies attacking the problem. The leaders in the field are based in Singapore, with the largest player being Hyflux(HYFXY).

There are also the big global companies in the sector, such as Veolia Environnement (VEOEY) and Suez Environnement (SZEVY).

But in most places (California is an exception) water rights are not owned by an individual or companies. Water is just there for the common good.

The problem here is that groups like ISIS are trying to change that equation.

This entry was posted on Tuesday, November 17th, 2015 at 6:56 pm and is filed under News.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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