Headlines about government summits to target potential droughts are not a surprise in the UK. The fact that these articles are appearing in February should certainly raise eyebrows and also raise attention of what is becoming a global issue. Water scarcity is not in itself a major problem, the globe is 70% covered by water. However there are significant issues surrounding the location of, and access to, usable quantities of it.
Long-term opportunities exist if accessible water supplies do continue to dwindle, especially for those companies that are in a position to supply water and for those that are able to develop their existing processes to reduce water reliance. Coca-Cola is a good example of an incumbent company with a water-intensive manufacturing process that has started to adapt to rising concern. Globally, the company has reduced water use per sales by 30% over the past five years and developed rainwater harvesting structures.
Industries and companies that are unable to adapt will find their ability to compete is eroded. Rising prices for water and for goods that use water in their production will contribute to inflation and potential civil unrest. On the international stage, China has identified water as a future growth concern, and for some time water has been a pressing issue for international relations in the Middle East.
With droughts forecast for the South East of England it is likely that over the long term global water shortages will increasingly become a pressing issue.