The world is no longer stumbling through a short-lived water emergency; It has blown straight past crisis and into full-scale “water bankruptcy.”
This, as humanity is now consuming more water each year than the planet can replenish through rain and snow, effectively overdrawing nature’s account and pretending the bill will never come due. This is the view of the United Nations University Institute for Water, Environment and Health (UNU-INWEH) in its report titled “Global Water Bankruptcy, Living Beyond Our Hydrological Means in the Post-Crisis Era” released last month.
The report’s lead author and director of UNU-INWEH, Kaveh Madani, compared humanity’s behavior to reckless financial mismanagement—spending without restraint and expecting savings to last forever.
“If we continue using more than what’s available or our natural income, then we have to go to our savings,” he said.
Madani described “water bankruptcy” as a deliberately forceful term, stressing its seriousness rather than novelty. “But it’s not a buzzword and we want people who will be using it to use it responsibly.”
According to Madani, the analogy is exact: just as financial bankruptcy exposes a broken budget, water bankruptcy signals a system that no longer works.
“In the same way that financial bankruptcy forces us to admit a harsh reality and accept that the current business model is no longer viable, water bankruptcy requires the same honest recognition. In many parts of the world, our existing development model and water governance systems have proven unsustainable and fundamentally dysfunctional.”
He rejected the comforting language of “crisis,” noting that a crisis implies something temporary. In large parts of the world, water scarcity is no longer an exception—it is the baseline. Humanity, he warned, is steadily draining both surface water and groundwater, leaving nothing resilient behind.
DAMAGE ALREADY DONE
According to the report, the damage is already unmistakable. Since the 1990s, half of the world’s major lakes have been shrinking, even though these water bodies directly sustain one-quarter of the global population. Over the past five decades, nearly 410 million hectares of natural wetlands—an area almost the size of the European Union—have been erased, stripping ecosystems of their ability to buffer floods, filter water, and sustain life.
The situation underground is no better. Half of all domestic water use worldwide relies on groundwater, while more than 40 percent of irrigation depends on aquifers that are being relentlessly drained. A staggering 70 percent of major aquifers show long-term declines, meaning humanity is mining water it cannot realistically replace.
The human toll is immense and growing. Roughly 4 billion people face severe water scarcity for at least one month every year, while three-quarters of the world’s population live in countries classified as ‘water-insecure’ or ‘critically water-insecure’. At the same time, 2.2 billion people still lack access to safely managed drinking water, and 3.5 billion are without safely managed sanitation—a damning indictment of global priorities.
The economic consequences are equally brutal. Between 2022 and 2023 alone, 1.8 billion people lived under drought conditions. The annual value of lost wetland ecosystem services has been estimated at $5.1 trillion, while drought-related losses reached $307 billion per year. These are not abstract projections; they are the measurable costs of systematic failure.
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