The Strategist

Why Canada Is Not Going to Share its Water

06/22/2015 - 15:13

Despite the fact that Canada is rich with water resources, it is predicted that it is going to be short of water, as demographic change and the climatic situation in the country are threatening the water resources of Canada.
However, the assumption, that Canada could export water, has periodically emerged. Nevertheless, these plans are very unlikely both because of disagreement with the commercialization of public water and due to the fact that the export of water may be disadvantageous.

And while Canada intends to protect its fresh water resources, it will not sell it and turn the water in the product sold.

Canada, which is rich with resources and has a fairly small population, has the ability to export a range of commodities, including oil, gas, fertilizer and wheat.

Although Canada has only 7% of the world's renewable fresh water resources, and less than 1% of the total population of the Earth, water is unlikely to be another of commodities that the country will export, despite the fact that other parts of the world experience a strong lack of water resources.

Canadian citizens generally believe that access to water is one of the basic human rights and oppose any attempt to sell it.

In addition, the complexity of the logistics and the lack of economic benefits - not only for Canada but also around the world - are representing the factors, which make the export of large volumes of water unlikely.
The amount of renewable fresh water per capita in Canada is more than 80 thousand. Cu. per year. Even in other countries, which are generally not considered a country with a shortage of water, the amount per capita is much smaller.

For example, the amount of water per capita in the UK is a little more than 2,300 cubic meters per year, while the US has a little more than 9500 cubic meters.

However, an excess of water per capita in Canada tends to be more on paper than in reality. Water prices in Canada are among the lowest in OECD countries, which leads to excessive consumption of this resource.

Moreover, as in the case of the US, Canadian water is distributed unevenly. Most of Canada's population lives in the southern part of the country, and 60% of renewable freshwater resources are located in the northern part, so access to these resources is limited.

In fact, some parts of Canada even experience some lack of water.

Provinces like Alberta, Manitoba and Saskatchewan are usually drier than other parts of the country.

Development of the agricultural sector and industry in these provinces, as well as population growth which has been observed in recent decades, have led to water shortages in some parts of these provinces. At the same time, it is predicted that the situation will only worsen over the coming decades.

Agricultural and mining activities in the region are expected to increase, despite the reduction in water resources.

The glaciers that feed the major rivers in the region decreased by approximately 25% over the last 100 years.

Expected increase in average temperatures and more frequent droughts in the future will further increase water scarcity.

Although some parts of Canada are scarce of water, the shortage in the country is not felt as seriously as in other parts of the continent.

For example, California is experiencing one of the most serious droughts. Ogallala reservoir in the agricultural center of the US is over-exploited, and the Colorado River is used by more than the norm.

A rather simple solution is often suggested for this problem: just transport water from plentiful areas to zones with shortage. However, a simple transport is usually more complex than pumping it through pipelines from point A to point B.

In extreme cases, when the political will and strong demand were able to overcome logistical barriers, countries such as China and Libya have implemented large projects on transportation of water in the country.

And the idea of transporting water from Canada to the arid regions of the USA has existed for over 50 years.

A number of projects on transportation of water has already been suggested. The biggest of them - the North American Union on water and energy.

The project, which was conceived as early as the middle of the XX century, provided the use of existing waterways and a series of new channels, reservoirs and other infrastructure to reallocate water resources across the continent.

Nevertheless, the draft still exists only on paper.

There was another, less ambitious project - Great Recycling and Northern Development Canal of North America, which was conceived around the same time and is aimed to remove fresh water from the James Bay and redirect it to the Great Lakes.

The cost of the project in 1960 was about $ 100 billion (more than $ 800 billion to date) to build and $ 1 billion a year to operate.

However, the movement of water is an expensive process. Water is heavy, and the elevation changes require energy-intensive technologies for its pumping. Costs vary depending on the characteristics of the project, but the movement of water for long distances can be up to five times more expensive than the possibility of desalination on the spot.

High costs can be justified in case of a profit’s prospect, but the price of water, as a rule, do not reflect the traditional market supply and demand.

Analysts believe that the price of water in the US is unlikely to ever reach the level at which the transportation scheme would make sense from an economic point of view.

Although small in terms of transportation projects are to take place in the border areas, large corporations and governments are unlikely to invest in large projects on transportation.

But even if it was profitable from the economic point of view, public resistance and political conditions would prevent the export of water.

Canada understands the importance of maintaining a high control of critical water resources and is unlikely to enter into the transaction, which will result in loss of control of an important resource in favor of its southern neighbor.

Federal policy on water has always been negative with respect to the major projects on transportation of water.

In the late 1980s and early 1990s, the North American Free Trade Agreement has caused controversy about whether the water is considered tradable goods.

Six companies initially received approval to export water from British Columbia, but public resistance led to the fact that the project remained unrealized.

In 1999, the federal government made a proposal to ban the transport of water in an amount, which could harm the environment.

Great Lakes-St. Lawrence River Basin Water Resources Compact Agreement of 2005 provided the joint management of water resources in two Canadian provinces and eight US states on the territory where the Great Lakes are located. However, the agreement also limited the major water transportation.

Nevertheless, many Canadian citizens have a negative attitude to the possibility that the water may become a commodity, which will be subject to the same trading requirements as other commodities.

Fresh water can become deficient over the coming decades, and since Canada has very large reserves of this resource, the government is likely to defend it.

The close relationship between the US and Ottawa, close trade relations between the two countries, as well as the ability to jointly manage water resources in the Great Lakes region - these and other factors contribute to the fact that the United States and Canada are ideal candidates for the start of international water supplies.

However, even if such deliveries will take place, the water is unlikely to be traded like oil or natural gas.

Access to freshwater is a major problem for many countries in the future, but rich-in-water countries’ helping hand, stretched out to countries with a shortage, is unlikely to ever exist, as economic realities are going to prevent that. Even if it was economically profitable, public opinion and public opposition would have prevented this.

Canadian Society does not consider water a raw material. According to citizens, the water is rather a human right, than a commodity, and countries with rich water resources need to protect them - and, as in other regions the water scarcity is growing, this view is unlikely to be changed.