Global Economy

Water, the economy, and development: New insights on a complex challenge

In the World Bank Water Practice, we often talk about how issues like flooding and droughts threaten our mission to end poverty and boost shared prosperity. But how much do we actually know about how these floods and droughts — "water shocks" — impact farmers, firms, and communities? Perhaps adaptation in the economy has limited such impacts. Or maybe policies have led to economies being more vulnerable to such shocks.

Also available in: Español

Coauthored by Victor Arroyo, Principal Executive Water and Sanitation at CAF, and German Sturzenegger, Water and Sanitation Specialist at IDB

Also available in: Spanish

Two years ago, during the 2014 SIWI World Water Week, key international experts discussed the need for a paradigm shift in water consumption: the move from a linear to a circular economy—an economy that is restorative and regenerative by design, and which aims to keep products, components and materials at their highest utility and value at all times.

Wastewater Reuse in the Circular Economy

With global demand for water predicted to exceed viable resources by 40 percent in 2030, it is necessary to rethink our traditional approaches to water consumption and adopt new approaches that allow for this vital resource to be reused as much as possible, and achieve efficient standards for water management.

The World Bank at World Water Week 2016

These previous SIWI World Water Week discussions allowed raising awareness about the adoption of a circular economy as a viable sustainable development strategy; its particular relevance to the water sector, in view of the fundamental and cross-cutting role it has across all sectors; and the combination of regulations and incentives, and strong multi-stakeholder approach, required to allow the market to transform. The need for a “paradigm shift” in the water sector—moving away from traditional linear water consumption patterns of “take-make-dispose” and heading towards a circular economy approach where wastewater is no longer seen as waste or an environmental hazard, but rather as a valuable resource that contributes to overcome water stress and imbalances between supply and demand —is particularly relevant to the Latin American region, and the 2016 SIWI World Water Week event of this year will take this conversation forward.