Water Futures market invites speculators, challenges basic human rights
by Pedro Arrojo-Agudo
UN Special Rapporteur on water and human rights
The UN Special Rapporteur on water and human rights today expressed serious concerns about the creation of the world’s first futures market in water, saying it could invite speculation from financiers who would trade it like other commodities such as gold and oil.
On 7 December, the CME Group launched the world’s first water futures contract for trading with the aim to help water users manage risk and better balance the competing demands for water supply and demand amidst the uncertainty that severe droughts and flooding bring to the availability of water.
The new water futures contract allows buyers and sellers to barter a fixed price for the delivery of fixed quantity of water at a future date.
“You can’t put a value on water as you do with other traded commodities,” said Pedro Arrojo-Agudo. “Water belongs to everyone and is a public good. It is closely tied to all of our lives and livelihoods, and is an essential component to public health,” he said, pointing importance of having access to water in the fight against the COVID-19 pandemic.
“Water is already under extreme threat from a growing population, increasing demands and grave pollution from agriculture and mining industry in the context of worsening impact of climate change,” said the Special Rapporteur on the human rights to safe drinking water and sanitation. “I am very concerned that water is now being treated as gold, oil and other commodities that are traded on Wall Street futures market.”
As well as farmers, factories and utility companies looking to lock-in prices, such a futures market could also lure speculators such as hedge funds and banks to bet on prices, repeating the speculative bubble of the food market in 2008.
“In this context, the risk is that the large agricultural and industrial players and large-scale utilities are the ones who can buy, marginalizing and impacting the vulnerable sector of the economy such as small-scale farmers,” said Arrojo-Agudo.
“Water is indeed a vital resource for the economy – both large and small-scale players - but the value of water is more than that. Water has a set of vital values for our society that the market logic does not recognize and therefore, cannot manage adequately, let alone in a financial space so prone to speculation,” said Arrojo-Agudo.
“While there are on-going global discussions concerning water’s environmental, social and cultural values, the news that water is to be traded on Wall Street futures market shows that the value of water, as basic human right, is now under threat.”
The human right to safe drinking water was first recognized by the UN General Assembly and the Human Rights Council in 2010.
Visit the related web page
The socio-economic impact of the COVID-19: 150 million more children living in poverty
by Save the Children and UNICEF
The socio-economic consequences of the COVID-19 pandemic are already having devastating effects on children’s ability to access health, education, nutrition, water and sanitation and housing services, with a projected additional 150 million children living in multidimensional poverty.
Yet, with parents losing jobs and income, it is equally important to understand what the consequences will for children living in monetary-poor households.
By the end of the year, between 122 and 142 million additional children will live in households who cannot make ends meet due to the impact of the coronavirus pandemic, according to updated Save the Children and UNICEF estimates.
For 2021 – based on projections with a higher uncertainty – we expect only a modest reduction in the best-case scenario and numbers largely to remain unchanged in the worst-case scenario.
Our analysis reveals that even before the pandemic struck, 591 million children – almost 1 in 3 children in the mostly low- and middle-income countries included in our analysis – lived in households considered poor by national definitions. The vast majority of them lived in sub-Saharan Africa and South Asia.
As new evidence emerges and projections turn into facts, our end-of-year scenarios unfortunately become more pessimistic. When we first published those estimates in May, we projected an increase of children living in monetary poor household by 63-86 million.
When we updated those estimates based on new economic forecasts in June, the additional number of children in those families was estimated at 90-117 million. Incorporating the latest (October) forecasts of economic growth by the IMF and the World Bank, we now expect an increase of 122-142 million children in monetary poor households in comparison to the pre-COVID baseline.
This increase is due to more pessimistic economic outlooks across most regions and is driven by much gloomier picture for South Asia.
With the economic outlook for 2021 still very unclear, our estimates for this time next year come with a large degree of uncertainty.
In the best-case scenario, we may see the total number of children in monetary-poor households decrease by 44 million from the end of 2020 – or only one-third of the potential increases this year.
However, in the worst-case scenario, the numbers might be largely unchanged as compared to end-of-2020. This is a sobering reminder that monetary poverty for many families is not going to disappear any time soon and will have long-lasting impacts on the well-being of millions of children.
Our estimates take into account both an income effect – as the economic downturn will reduce household incomes – as well as a distribution effect. The latter accounts for the fact that changes in economic outputs will not impact all people equally and the fact that averages hide wide disparities underneath. Different estimates for both effects provide us with a range of scenarios, and as a consequent, a range of poverty estimates.
For now, these numbers are projections, and we hope that they do not become a reality. This would require further government actions addressing and mitigating the impacts of COVID-19.
UNICEF and Save the Children call for rapid and large-scale expansion of social protection in terms of coverage, type of interventions, and amount of support. These efforts could include cash transfers, school feeding and universal child benefits.
Governments must also invest in other forms of social protection, fiscal policies, employment and labour market interventions in order to support families.
These include expanding universal access to quality healthcare and other services, and investing in family-friendly policies, such as paid leave and childcare.
Given that many governments themselves face financial constraints, there is a need for predictable and enhanced official development assistance (ODA) as well as further debt relief above and beyond the efforts already under way.
* Note: These projections are as of November 2020.
http://blogs.unicef.org/evidence-for-action/children-in-monetary-poor-households-covid-19s-invisible-victims/ http://www.unicef.org/social-policy/child-poverty/covid-19-socioeconomic-impacts http://www.unicef.org/documents/lifeline-risk http://www.younglives.org.uk/content/news-release-covid-19-poorest-young-people-developing-countries-hit-deepening-inequalities http://bit.ly/3gPabok http://www.endchildhoodpoverty.org/ http://www.savethechildren.org.uk/news/media-centre/press-releases/11m-children-under-five-at-risk-of-extreme-hunger-or-starvation http://ophi.org.uk/ophi_stories/2020-release-of-the-global-mpi-2020/ http://reliefweb.int/report/world/asia-and-pacific-regional-overview-food-security-and-nutrition-2020-maternal-and-child
Visit the related web page
View more stories|