Water footprint virtual water abstract booklet (a4) pegasys (final)
1. “Water
and Food
Security
through
Trade”
Water Footprint, Virtual
Water & The Nile Basin
2. Project Background
NELSAP
The Nile Equatorial Lakes Subsidiary Action Program (NELSAP) is a subsidiary action program of The
Nile Basin Initiative (NBI). NBI, through NELSAP, seeks to promote regional agricultural trade as a
means to improve the efficiency of water use for productive agriculture. The NBI and NELSAP have
identified a key dimension in improving the efficiency of water use for production is through the use
of water footprint and virtual water trade to inform trade policy and strategy.
The water footprint of a product is the volume of water used to produce it. When talking about
water footprints, we often differentiate between blue water (surface water) and green water
(rain water) consumption. The virtual water content of a good and the water footprint are
often used inter-changeably. Virtual water import and export is the volume of water associated
with producing goods which are traded. We are able to imagine virtual flows of water from one
place to another through traded goods. Countries or regions that are water abundant are better
able to produce and export more water-intensive crops. A country that is water scarce may seek to
export goods with lower virtual water content and import goods with higher virtual water content.
Aims of the project
This project had two components that will support a current and continued understanding of the
virtual water/ footprint of goods in the Nile Basin countries:
1. A training program to build an understanding of how to estimate and how to use the
virtual water/water footprint concept.
2. A water footprint analysis of 11 commodities produced and traded in the Nile
Basin Riparian Countries (NBR)
The approach was not a comprehensive water footprint of the Basin, nor an attempt to investigate
the political economy of production and trade. The purpose of the analysis was to raise questions
rather than to dictate outcomes.
We applied the methodology developed by the Water Footprint Network. The 11 commodities
selected are set out below.
1
3. Commodities selected for water footprint analysis in the NBRs (2005-2009)
Cereals Cash Crops Fruit & Veg Beef
Bananas
Mangos
Flowers
Coffee
Wheat
Maize
Beans
Sugar
Beef
Rice
Tea
Burundi
DRC
Ethiopia
Kenya
Rwanda
Tanzania
Uganda
Sudan
Egypt
Note: Where a water footprint was not calculated, this was because that commodity is not
produced in that country in significant quantities.
For information on commodity water footprints in trading partners outside the Basin, or for global
average water footprints, we used Water Footprint Network data (available here:
http://www.waterfootprint.org/?page=files/WaterStat).
We have limited our analysis to the nine countries who are members of the Nile Basin
Initiative (Tanzania, DRC, Burundi, Rwanda, Kenya, Uganda, Ethiopia, Sudan and
Egypt. Eritrea, while a riparian, is an observer member to the NBI.) At the start of this
project (May 2011), the partition of Sudan and South Sudan had not been effected
and separate data for these two countries was unavailable. We therefore treated
Sudan and South Sudan as one country, namely Sudan.
2
4. Water & Comparative Advantage in the Nile Basin
The Nile Basin states have a comparative advantage in water resources compared to many other
countries in the world (see the figures below showing rainfall and ‘water towers’). The Nile Basin
states have not yet fully leveraged their comparative advantage in water, particularly in regard to
agricultural production. As water becomes more scarce globally, there will be an increased demand
for areas with water resources. This provides opportunities for the Nile Basin states.
Average Annual Rainfall (Source: African Water Atlas, UNEP) Africa’s Water Towers (Source: African Water Atlas, UNEP)
Water Footprint is one tool to help decision makers think about:
• Trade in agricultural products
• Comparative advantage and food production
Virtual water ‘trade’ has an implication for water security and, by extension, for production and
food security. When a water scarce state ‘imports’ virtual water in the form of crops and livestock, it
frees itself from its own climate. Water that would otherwise be used for agriculture is freed up for
other important uses, such as industrial and economic development.
A water abundant country has a valuable resource that enables cultivation of water intensive
agricultural products for export to water scarce countries. A country’s water abundance may be
associated with rainfall, runoff or groundwater. This comparative advantage may be leveraged to
contribute to economic development.
Trade and virtual water:
Water footprint allows us to map trade in virtual water around the world (map over leaf). Nile Basin
states, despite having large water resources, are not significant players in virtual water trade. The
DRC, for example, has high levels of rain fall and surface water and yet is depicted as a net water
importer.
3
5. Nett virtual
water footprint
2
[Gm /yr]
-95 – -75
-73 – -35
-35 – -15
-15 – -5
-5 – 0
0–5
5 – 10
10 – 15
15 – 50
50 – 115
No Data
Virtual water trade: green indicates a net virtual water exporter and yellow-red a net virtual water importer,
black arrows indicate intensity of trade (Water Footprint Network)
Water Footprint of Production:
Considering the water resources we know are available, irrigation water use (blue water) in
production in the Nile Basin is lower than it could be (see map below, where there is low intensity in
colour). Similarly, with their high rainfall patterns, rain fed (green water) production is also lower
than it could be in the southern riparian states.
Green Water footprint
[mm/yr]
0 - 10
10 - 50
50 - 100
100 - 200
200 - 500
500 - 1,000
> 1000
Blue Water footprint
[mm/yr]
0-1
1 - 10
10 - 50
50 - 100
100 - 200
200 - 500
> 500
4 Global distribution of green and blue water use (Water Footprint Network)
6. The Implication of Dry Climates
The Nile Basin countries as a whole are unique and interesting due to the wide range of
evapotranspiration rates between the riparians.
Average annual reference The downstream riparians experience very high evapotranspiration
evapotranspiration
rates (2600-3000mm). By contrast, parts of the supstream riparians
experience relatively low evapotranspiration (1200-1400mm).
Interestingly the average annual temperature is relatively similar
throughout the basin.
Rates of evapotranspiration have a strong influence upon water
footprints; in hotter, dryer places with higher evaporation, the water
Evapotranspiration in mm
1000 - 1200
footprint of the same crop is higher. Thus water footprint highlights
differences in climatological comparative advantage, beyond rainfall.
1201 - 1400
1401 - 1600
1601 - 1800
1801 - 2000
2001 - 2200
2201 - 2400
2401 - 2600
On the other hand, water footprints are reduced by higher crop yields.
2601 - 3000
Part of the analysis highlights the impact of evapotranspiration on
(Source: AQUASTAT)
water footprints by comparing the same crop produced upstream and
downstream. In the dryer downstream parts of the basin, yields need to be very high in order to
achieve comparable water footprints to the wetter upstream countries. The figure below presents
the average water footprint and average yield for maize in the Nile Basin countries (using data from
2005 to 2009).
It is necessary for Egypt to achieve yields above 8 ton/ha to realise a water footprint of maize roughly
equal to Uganda which realises yields of 1.49 ton/ha. If Uganda increased its yields even slightly, its
water footprint would reduce further. While there is a clear relationship between water footprint
and yield, it is obvious that other climate factors also influence the water footprint of production in
a country. This climate comparative advantage explains the difference in water footprint of
production between Kenya and Uganda, despite having similar average yields.
4 000 9.00
8.06
3 500 X 8.00
7.00
3 000
6.00
2 500
5.00
2 000
4.00
1 500
2.19 3.00
1.56
1 000 X 1.57 1.49 2.00
1.20 X
1.06
0.78
X 1.10
X
500 X X X 1.00
X
-1 0.00
Burundi DRC Ethiopia Kenya Rwanda Tanzania Uganda Sudan Egypt
Avg Green WF Avg Blue WF Avg Total WF X Yields (ton/ha)
Average water footprints and yields of maize for each country in the NBR (m3/ton) 2005-2009
5
7. Opportunities in Green Water
To date, most virtual water or water footprint analyses have focussed on the contribution of virtual
water trade to water savings, especially in water scarce regions. Very little has been highlighted
about the opportunity cost of the associated water use. Yet green water usually has a lower
opportunity cost and lower environmental externalities than blue water use.
An important contribution of water footprint analysis is to establish whether the water used in
production depends upon rainfall (green water) or water resources (blue water). Traditionally, there
has been a focus on the importance of irrigation systems (blue water use) when thinking about
agricultural development and food security. But it has become increasingly important to highlight
opportunities for rain fed agriculture (green water use), particularly when thinking about efficient
production and food security at a global level.
Green and blue water have different characteristics and this leads to different opportunity costs.
Green water generally has a lower opportunity cost than blue water. However, green water may
have lower reliability than blue water, particularly where blue water is enhanced by surface storage
or groundwater use. The table below summarizes some of the features of green and blue water.
From the viewpoint of opportunity cost related to the use of scarce water resources, using green
water in production can be more efficient than using blue water, holding other factors constant. It
is therefore important to head off a purely water-centric interpretation of water footprint analysis
which does not take into account the wider consideration of the context of production and trade. In
the absence of appropriate context, the inferences of water footprint analyses can be unhelpful or
misleading.
With regard to the Nile Basin, the results of water footprint analysis highlights comparative water
use in production upstream and downstream in several cases. This indicates the benefits not only of
climate (and evapotranspiration) but also on green versus blue water use in production and the
relative opportunity costs of water use. The results of the analysis can be used to inform discussions
about the impact of production on the Basin and the impact on other Riparians of the Basin.
At a global level, it has been observed that virtual-water trade can reduce irrigation water demand
globally and play a role in ensuring water and water dependent food security in water scarce parts
of the world. At present, however, this method of global water saving is not fully exploited due, in
part, to the absence of a more water friendly international trade regime with equal access to global
markets, which takes into account both water productivity and blue/green water ratio in products.
In the context of water scarcity and demand in the future, green water production will become
increasingly important. Rain-fed agriculture holds great underexploited potential for increasing
water productivity through better water management practices – gaining more yield and value
from water.
Blue Water Green Water
Sources Rivers, lakes, reservoirs, dams, Rain water (stored in the unsaturated
ponds, aquifers etc. soil and can be taken up by the plant roots.)
Mobility Highly mobile Highly immobile
Substitution of sources Possible Impossible
Competitive uses Many, leading to trade-offs in water use. Few, the main being natural vegetation.
Storage & conveyance Required Not required (except in rain water harvesting)
infrastructure
Cost of use High Low
Impact of use High (excessive irrigation can cause severe Low
6 salinization, water logging and soil degradation)
8. Wheat, Imports and Cereal Production
Wheat is imported in large quantities by several Nile Basin countries, where local
production is insufficient to feed demand. The table below shows production
relative to imports and the associated virtual water imports.
In most cases, imports are more than 100% of production. Correspondingly, the
Nile Basin Riparians (NBRs) are importing large volumes of virtual water in the
form of wheat imports. Wheat imports represent a foreign currency burden on
several countries.
Burundi DRC Ethiopia Kenya Rwanda Tanzania Uganda Sudan Egypt
Production 8 9 2 569 107 41 96 18 623 8 059
(‘000 tons)
Imports 7 334 965 631 9 641 357 1 479 5 960
(‘000 tons)
Volume of 9 447 1 161 1 101 16 621 1 493 3 445 13 882
Virtual Water
imports (mm3)
Average wheat production, wheat imports in the NBRs (2005-2009)
The graph below shows the average water footprint of wheat in each NBR as well as the standard
deviation (indicating the variation in water footprints within the country), against the global
average water footprint of wheat.
The average NBR country has a water footprint of wheat production that is lower than the global
average. The lowest water footprint of wheat is in Tanzania, driven by the high yields and lower
levels of evapotranspiration in the areas where wheat is grown. Furthermore, most countries
(except for Sudan and Egypt) grow rain fed wheat, which has a water footprint similar to the natural
vegetation that the cultivation replaced. The implication is the impact of rain-fed wheat production
on the water resources of the Nile Basin countries is negligible and thus the water-related
opportunity cost of wheat cultivation in these countries is small.
3 500
3 000
2 500
2 000
1 500
1 000
500
-1
di C pi
a ya da ni
a da an pt
ru
n DR hi
o
Ke
n an a
ga
n
Su
d
Eg
y
Rw nz
Bu Et Ta U
Average Green WF Average Blue WF
Average Total WF Global Average Total WF
7
Average water footprints of wheat in the NBR states, 2005-2009, including the std deviation and the global
average water footprint (m3/ton)
9. The comparative advantage in wheat production in the NBRs is driven by different factors within the
upstream and downstream riparians. In the upstream riparians, wheat is rain fed and
evapotranspiration rates are lower because, upstream, there are lower temperatures. This leads to
more efficient water use because there is less effective water loss to evapotranspiration and the
opportunity cost of green water is much lower than blue water.
In the downstream riparians, evapotranspiration rates are much higher and it is also necessary to
irrigate where there is insufficient rainfall. As a result, there is greater water loss to
evapotranspiration and there is a greater opportunity cost associated with blue water use.
Importantly, the use of multi-year yield information captures the variation in annual yields
associated with inter-year variation in rainfall patterns.
For wheat production to be relatively efficient in the downstream riparians, it is necessary for these
countries to realise higher yields in order achieve comparable water footprints. Furthermore, the
water footprint estimates do not include the evaporative losses in the river, storage and distribution
system required to provide reliable water for irrigation.
It is possible to examine the value per cubic meter of water of each commodity at the average global
price (2005-2009) for the maize, wheat and rice, noting that these prices are quite volatile but
typically move together. It is therefore possible to make comparisons of the value per cubic meter of
water use both between countries and between commodities.
Value of a cubic meter of water at the average international trade price, 2005-2009 (USD/m3)
Burundi DRC Ethiopia Kenya Rwanda Tanzania Uganda Sudan Egypt
Maize 0.05 0.04 0.13 0.08 0.06 0.07 0.17 0.05 0.17
Rice 0.12 0.06 0.10 0.18 0.21 0.17 0.07 0.13 0.42
Wheat 0.17 0.24 0.11 0.24 0.18 0.37 0.15 0.11 0.17
The values in this table are the average global price of this commodity (USD/ton) divided by the country water footprint (m3/ton)
At a commodity level, the value of a cubic meter of water in wheat production is higher than rice
and maize production in Burundi, DRC, Kenya and Tanzania; at least at the international price of
these commodities. This is significant when one considers wheat is a rain fed crop (ie it is green
water use) in these countries. The production of rice, by comparison, is water intensive and more
successful with irrigation (blue water) and has economies of scale and a need for management
capacity.
8
10. Cultivation and Consumption of Basic Food Crops
This water footprint analysis covered
certain subsistence crops which the
NBRs produce to consume rather than
trade. These crops are invariably rain
fed. Those included in this analysis are
beans and bananas. Although these
crops were produced in relatively
significant volumes, they have low
yields which lead to larger water
footprints. However, because these
crops are produced with rain water,
Women transporting bananas (Rwanda, 2011) the impact of the associated water
footprint is low.
The water footprint of beef from beef cattle has been reviewed elsewhere by Chapagain &
Hoekstra (2003) and once again by Mekonnen & Hoesktra (2012). In this analysis, we examined
beef cattle farmed primarily for their meat and slaughtered at 3 years (as opposed to animals kept
by rural, subsistence households for milk and ploughing purposes that may be slaughtered for their
meat at the end of their useful lifespan.) Beef cattle in the Nile Basin are generally farmed on
rangeland pastures with a small amount of supplementary food made up of crop by-products.
The focus of other studies has been fairly Eurocentric, concentrating on rising global meat
consumption, the intensification of animal production systems, and the pressure on freshwater
resources. The studies highlight that animal products have a large green and blue water footprint
and it is more water-efficient to produce crop rather than animal products for food.
In a developing country context such as the NBR, it is important to consider beef cattle are grazed on
rain fed pasture (ie have a green water footprint). Farm land, especially irrigated farm land, is
generally not dedicated to cattle food stuffs. Furthermore, within the Nile Basin, there is also an
important differentiation to be made between beef from cattle grazed on marginal, low value
arable land and beef from cattle grazed on pastures which could arguably be used for crop
production instead. In low-value arable land, there are lower yields and higher risks associated with
crop production (especially if rainfall is
very variable). The opportunity cost of
rain fed pasture for cattle is very low and
the value of water in production
becomes much higher if it is used to
produce feed for beef cattle. The impact
of the water footprint of beef cattle
farmed in developing countries is
therefore much lower than in developed
countries with industrialised animal
production systems. Cattle on the shore of Lake Tanganyika (Burundi, 2011)
9
11. The Producer Perspective for Cash Crops
Increasing global attention has been paid to the water footprint of cash crops in the NBRs, such as
tea, coffee and cut flowers. These crops are certainly water intensive and have water impacts, but it
is also true that they are produced in the NBRs because of climatic comparative advantage;
particularly, high levels of rain fall and lower temperatures/higher humidity leading to lower
evapotranspiration rates.
Cash crops are important income generators
for the agrarian upstream Nile Basin
countries. This production earns valuable
foreign exchange and is a contributor to
economic development and alleviation of
poverty in the area in which the crops are
produced.
A strong focus of water footprint research
has been to examine the impacts of
consumption, particularly from the
Coffee cherry sorting (Kenya, 2011)
perspective of consumers in Europe and
North America. Some of the products examined in these studies are produced extensively by the
Nile Basin Riparians.
An example recent water footprint analyses which feature NBRs is the Water Footprint of Tea and
Coffee Consumption in the Netherlands (Chapagain & Hoekstra 2007). The map below shows
virtual water imports to the Netherlands as they relate to coffee imports, the greener the area, the
more the import. It can be seen that coffee produced in Tanzania and Uganda and exported to the
Netherlands is associated with 4% of the total virtual water import to the Netherlands.
Virtual Water imports to the Netherlands related to coffee imports (Chapagain & Hoekstra 2007)
10
12. The very effective imagery used by the authors to demonstrate the virtual water flows is shown in
the Figure over leaf. This is an example of how virtual water flows out of the Nile Basin to other parts
of the world in the form of cash crop exports.
As awareness of water use and water impacts of trade gains traction globally, it is important that
the NBRs contribute to and participate in these discussions to ensure a balanced perspective is
presented, because virtual water trade is one driver of economic growth and development in the
NBRs. .
40000 For example, the water
35000 footprint of coffee in the
30000 NBRs is on average lower
25000 than the water footprint of
20000 coffee in the main coffee
producers in other parts of
15000
the world. Figure left details
10000
this graphically; (the NBRs
5000 are separated from their
0 competitors with the dotted
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important message for
Colo
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Philli
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Cost
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consumers around water
Glob
Green Blue Total use efficiency and coffee
production. The NBRs have
Virtual water content of green coffee in Nile Basin compared to Global
Competitors (m3/ton) The comparison above is made between Mekonnen a climatic comparative
& Hoekstra's (2010) estimate for 1996-2005 for the global competitors advantage which enables
and we are examining our updated data (2005-2009). them to use water more
efficiently when growing
coffee. This should also be linked to the message that the water-related opportunity cost of rainfed
coffee production is relatively small, while the foreign exchange value from this export is relatively
high.
The table below sets out the value per cubic meter of water for each cash crop. It is possible to make
comparisons between countries for one commodity and it is also possible to make comparisons
between commodities in each country.
Value of a cubic meter of water at the average international trade price, 2005-2009 (USD/m3)
Burundi DRC Ethiopia Kenya Rwanda Tanzania Uganda Sudan Egypt
Sugar 0.24 0.19 0.32 0.24 0.13 0.48 0.21 0.11 0.18
Tea 0.29 0.11 0.28 0.82 0.60 0.52 0.60
Coffee 0.20 0.07 0.14 0.06 0.12 0.11 0.10
Flowers 21.00 22.00 6.00 24.00 12.00
*The values in this table are the average global price of this commodity (USD/ton) divided by the country water footprint (m3/ton)
Kenya, for example, realises a very high value per cubic meter of water for tea production followed
closely by Rwanda and Uganda. Tea production on average realises a higher value per cubic meter
of water than either coffee or sugar for Burundi, Kenya, Rwanda, Tanzania and Uganda. Burundi
realises the highest value per cubic meter of water for coffee production, followed by Ethiopia.
The clear and quite significant outlier in regard to value per cubic meter, however, is cut flowers.
This indicates a commercial opportunity for the NBRs to capitalise on the climatic comparative
advantage and access to water resources for cut flower production. 11
13. Rice, Water Footprint and Trade in the Nile Basin
Analysis of the water footprint of rice
differentiates between rain fed and irrigated
rice production in the NBRs. This was in an
attempt to compare rice production which
relies entirely on rainfall, and where possible
rain water harvesting, for rice production, and
comparing this to rice produced under
irrigation.
Rain fed rice fields (Burundi, 2011) Rain fed rice accounts 67% of rice production in
the NBR countries. The table below shows the
average rice production in the NBRs as well as average yields for rain fed and irrigated rice.
Average Rice Production in the NBRs and average yields for rain fed and irrigated rice (2005- 2009)
Burundi DRC Ethiopia Kenya Rwanda Tanzania Uganda Sudan Egypt
Tonnes 72 316 53 48 71 1 285 171 24 6 506
(‘000)
Rain fed 2.0 0.8 1.9 2.3 2.1 1.7
ton/ha
Irrigated 3.4 2.9 4.7 4.9 5.8 2.0 3.7 9.8
ton/ha
The average water footprint of rice in the NBRs is indicated below, distinguishing between irrigated
cropping systems and rain fed systems. On average, rain fed rice has a larger water footprint than
irrigated rice. Although rain fed rice receives less water per hectare, the yields are lower, so the
efficiency of water use per unit of product per hectare is lower.
8 000
7 000
6 000
5 000
4 000
3 000
2 000
1 000
-..
i ia ya da ia da an t i C pia ya nia da
nd iop Ken wan nzan gan Sud yp nd DR thio Ken nza gan
ur
u Eg ur
u
B Eth R Ta U B E Ta U
Irrigated Rain fed
Average Green WF Average Blue WF Average Total WF
12 Average water footprint of rice in the NBR countries (m3/ton)
14. In the absence of yields for irrigated rice in DRC (and because production was so small) we have only
calculated the water footprint of rain fed rice. We also queried whether the low yield reported in
DRC (calculated as total tonnes produced given hectares cultivated in-country) is due to incomplete
or unrecorded data. This is because rice production volumes in the DRC suggest this is an important
crop. A higher yield would realise a lower water footprint in the DRC.
It is not useful to extrapolate from this analysis that rain fed rice production has a higher water
footprint per ton and is therefore bad. There are other considerations in agricultural production
apart from water. These include land use, the costs of irrigation infrastructure, and the importance
of rain fed production with limited capital, infrastructure and management requirement to
smallholder livelihoods.
From a water use perspective, where rainfall is relatively abundant and if sufficient rain water is
available to achieve a water footprint close to that of irrigated rice, it is unhelpful to make an
unfavourable comparison between the two. This small difference between production methods
can be observed in Tanzania.
However, where the gap is larger between rain fed and irrigated rice a more compelling argument is
available in order to motivate for investment in irrigated rice production over rain fed rice
production from a water efficiency perspective. Alternatively, questions may be raised about the
possible productivity gains that may be achieved through improved cultivation and management
practices for rain fed rice.
Where the water footprint of rain fed rice is the same or lower than the water footprint of irrigated
rice – as can be observed in Uganda, Ethiopia and Burundi – this highlights potentially inefficient
blue water management. Blue water use carries with it higher financial and opportunity costs than
green water use and this example motivates for better management of irrigated rice production to
achieve higher yields.
Trade in Rice
The NBR states, except for Egypt, are net rice importers ranging from Kenya which imports 80% of
rice supply, to Tanzania which imports less than 1%. Rice trade within the Basin is so small as to be
almost negligible; the majority of trade is outside the Basin. Large volumes of virtual water are
imported by upstream Nile Basin countries from countries outside the Basin.
Egypt exports some of its rice (10%). A portion of Egypt's virtual water trade in rice is being
transported upstream to Sudan and to Kenya, but the majority is to trading partners outside of the
Nile Basin.
Virtual Water Trade flows in Rice, Egypt (2005-2009)
Virtual Water exports from Egypt
Virtual Water imports to Egypt
Only significant VW flows are shown, relative size of arrow shows relative flow 13
15. Opportunities for Regionalisation through Water Footprint
Regionalisation is a common buzz word in international relations debates, including the Nile Basin.
Water resources are often regional by their very nature; the majority of the globe’s rivers are trans-
boundary, making upstream and downstream riparians states irrevocably interdependent. The way
in which water is managed is therefore very important to regional development. One of the aims of
this study is to contribute an analysis of agricultural commodities produced in the Nile Basin
countries and examine whether there are any insights for regionalisation.
The Nile Basin countries share a common water resource, each with a varying proportion of land
area located within Basin. Water footprint analysis highlights climatological comparative
advantage. Trade theory argues that facilitating trade based on comparative advantage is the most
efficient way of generating economic growth and therefore development.
The concept of virtual water combines these two attributes into one model. If countries in a Basin
concentrated resources on producing products for which they have a comparative advantage,
virtual water trade within the Basin might contribute to allocation efficiency. Since the Nile Basin
countries are largely agrarian economies, water is largely used for agricultural purposes. In practice,
therefore, cooperation in production and trade in food deserves special treatment given mounting
food needs. Virtual water trade in the Basin could be viewed as food trade.
Overall this analysis has shown that - except in specific cases where a downstream country is
achieving very high yields (eg Egypt’s maize and rice production) - the water footprints are lower
upstream in the Nile Basin. This is strong evidence that evaporative loss would be reduced, and
water within the Basin allocated and used more efficiently, if countries within the Basin reallocate
some of their water from the production of crops for which they have a comparative disadvantage
to that which they have a comparative advantage. Comparative advantages can be climatological
(and here upstream is favoured over downstream) but have also been shown to be in yields (some
countries have higher yields which positively impact water footprints).
However, virtual water trade would only contribute to regional development in the region if there
were a regional market. Without functioning local and regional markets, climatic opportunity costs
or comparative advantages cannot be properly established. Current trade climates and conditions
are not very supportive for enhancing virtual water trade within the Nile Basin. Although there are
some moves toward economic integration through the East African Community (EAC), trade
between upstream and downstream riparians is small as compared to trade with the riparians and
the rest of the world.
Finally, there is a collective action challenge in benefit sharing through virtual water trade which
needs to be overcome. Virtual water trade has geopolitical implications as upstream and
downstream interaction induces dependencies between countries. Inter-Basin trade would require
cooperative measures from the countries and mutual trust that agreements would be kept in the
future. There is a distance to go given historical relationships within the region.
Despite the above, the water footprint, agriculture and trade discussion from this analysis takes on
a particularly interesting regional perspective when distinguishing the broad types of agricultural
production in the Nile Basin countries and the following observations can be made:
• Cash crops (such as coffee, tea, flowers and sugar) are produced for both domestic
consumption and export, with a global competitive advantage in production and brand for
some of the Nile Basin countries. Advantage can be gained by taking a regional perspective in
using country brands to export regional production (such as tea from Kenya see map below)
and expanding the processing opportunities between countries along the supply chain,
while proactively and coherently managing customer perceptions about the water impacts
of these crops (such as around coffee and flowers).
14
16. • Cereals (such as maize, wheat and rice) are staples that vary in demand according to country
consumer and cultural preferences, with a competitive advantage in production by individual
Nile Basin countries. While many countries largely produce to consume rather than trade over
the long term, there are regional opportunities to explore regional self-sufficiency and reduce
import needs, by expanding production in those countries with comparative advantage (such as
wheat in Tanzania or maize in Uganda), sharing technology and management capacity
between countries (such as from Egypt) and promoting regional inter-country trade to
overcome climate variability and drought.
• Staple foods (such as beans, bananas and livestock) to supply domestic demands according to
cultural preferences are produced in-country through rainfed cultivation in the southern
countries. Regional opportunities to promote food security relate to sharing management
expertise to improve production yields and promoting inter-country trade where there is
comparative advantage to overcome climate variability and drought.
Virtual Water Flows in tea trade in the Nile Basin, 2005-2009
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