Water scarcity is described by the United Nations Development Programme as one of the gravest threats to human security in the Arab world. Gulf Arab states are especially vulnerable to water shortages due to limited availability of renewable water resources and escalating demands that result from the quick pace of economic development, rapid population growth, changing consumption patterns, and management inefficiencies. Accordingly, sustainable water provision is a persistent challenge facing governments of the Gulf Cooperation Council (GCC) states. Despite of the current political tension, water and food security are fundamental issues that require cooperation among GCC countries.
Gulf states have pursued several initiatives to ensure water and food security. These include importing water – either explicitly by delivering water across borders or implicitly by importing water-intensive products. However, the attractiveness of this approach is restricted by geopolitical complexities and national security concerns. Alternatively, GCC states have recently switched to “outsourcing farming”. At a time when per-capita water availability is dwindling (Figure 1), a strategy of investing in farmlands abroad seems more sustainable than depleting non-renewable groundwater aquifers. Nevertheless, this solution has its own limitations that needs to be addressed carefully.
Alternative Solutions for Addressing Water Scarcity
Importing Water
Some GCC states seriously considered several proposals for importing water from neighboring countries such as Iran, Turkey, or Lebanon. Nevertheless, most of these proposals were rejected as the geopolitical costs were thought to outweigh the potential benefits. In the mid-1980s, the Gulf States negotiated a multilateral deal with Turkey over a dual pipeline project that would move water from the Ceyhan and Seyhan Rivers in eastern Turkey to Gulf countries at an estimated cost of $22 million. This was considered a strategic oil-for-water deal, since the project was to be paid for by its primary beneficiaries in the Gulf. Later, in 2009, Qatar executed a feasibility study for a bilateral water import project that would transfer water from Iran’s Karun River to recharge groundwater reserves and supply water for irrigation in Qatar. However, neither of these proposals was successful since water importers in the Gulf were concerned that water-exporting countries could leverage their freshwater resources to serve geopolitical objectives.
Investing in Farmland Abroad
Given that agriculture represents the dominant sector in water consumption with an average of 85 percent of water resources in the Gulf dedicated to agriculture, GCC countries have announced plans to invest in farmlands abroad as a solution to sever water scarcity. The aim of foreign direct investment in agriculture – either through land lease or land ownership – is to target countries that are endowed with favorable agro-climatic conditions, have good economic and diplomatic relations with GCC states, and are geographically close to reduce transportation costs. By investing in farmlands oversees, Gulf countries are effectively reducing overextraction of groundwater resourcesthat are viewed as strategic reserves.
Although farming abroad is a rational strategy for countries that do not have sufficient renewable water and arable land, this strategy is usually met with suspicions of “land grabbing.” This is due to the lack of clear international laws governing the leasing or purchase of land across borders, and the absence of effective scrutiny over the terms and conditions of these contracts. Gulf States, thus, need to take into consideration the support of local populations and recognize that the actual food output of these lands is subject to climatic conditions.
Notwithstanding smooth implementation of agriculture outsourcing in certain areas, the attack on Saudi Star’s farm in Gambela, Ethiopia by local gunmen in 2012 is a striking example of the potential impact of local opposition on these projects’ output. As a result, some Gulf countries are seeking to expand their agricultural investments in developed countries, such as the United States and Australia, to minimize their exposure to social and political risks. A recent example was the purchase of 14,000 acres of farmland in California by the Saudi food giant Almarai in January 2016.
The usefulness and viability of recent strategies to outsource farming is yet to be tested against emergencies, food crises or extreme weather conditions. In the meantime, it is vital that the promoters of these operations in the Gulf States take into consideration the impacts of these investments on local communities, and aim for win-win outcomes in line with the FAO voluntary guidelines on the responsible governance of land tenure. Investors should also recognize the various risks involved, including social and political stability in the target countries as well as unforeseen climate shocks.
This blog is adapted from the following paper: Mai Mahmoud, “Water at the Nexus of Gulf Security and Growth Challenges”, Arab Gulf States Institute in Washington, 2016.
Any opinions stated herein are those of the author(s) and do not necessarily reflect the policies or opinions of IFPRI.
