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Water: how can we account for our most vital resource? - 10 May 2012.

The world is entering a period of growing water scarcity: by 2030, global demand for fresh water could outstrip supply by more than 40 % if water is used in the same way that it is today. These stark figures are the background to a new report from the International Resource Panel, a group of natural resources experts hosted by the United Nations Environment Programme.

The report 'Measuring Water Use in a Green Economy' argues that while the world faces serious water problems, their causes are often economic, social and political in nature, rather than bio-physical. These problems can be solved by balancing water use and needs between different sectors and ecosystems.

The report serves as a powerful reminder just weeks ahead of the Rio +20 global summit on sustainable development that the world needs to radically rethink the way it uses natural resources.

The lead author of the report, Jacqueline McGlade, Executive Director of the European Environment Agency (EEA), said: "Many parts of the world could face a water crisis in the future, not because they do not have enough water, but because they are not using it smartly enough. Accurate water accounts quantifying the amount of water we can safely use can help us use this resource both wisely and fairly."

The growing demands placed on water supply are not only the result of population growth, but also a result of the way in which our economies develop, according to the Resource Panel. Since 1900, humanity's water consumption has grown at twice the rate of population growth, jumping from 600 billion cubic metres in 1900 to 4,500 billion cubic metres in 2010.

People are not the only water users – environmental systems also need water to function. Maintaining these 'ecosystem services' should be seen as vitally important, as they form the basis of the European economy, the report argues.

Water accounting is a crucial tool for the purpose of water management and making economic assessments, alongside GDP growth and other economy-wide indicators such as greenhouse gas emissions. Ecosystem services should be considered within such resource accounting schemes to establish the links between resource efficiency, biodiversity and ecosystem services.

The private sector is showing increasing interest in taking water resources into account when considering future business. For public bodies to determine water balances, the report states that it is important to produce quantitative estimates of stocks and flows. Water accounts should also include other information, such as analysis of the impact of fluctuations and uncertainties associated with the global hydrological cycle, water licences, access rights and water quality.

10 May, 2012.