Water Investments in the year 2020 can accomplish a crucial contribution to a sustainable solution of the global water scarcity. Water plays an essential role in our everyday lives. Its sufficient availability is fundamental to the development of every nation’s economy. Proper water management is therefore a central pillar of sustainable development of our society but is at the same time one of our greatest challenges of the 21st century due to steady population growth, climate change and a general shortage of drinking water.
However, clean and usable water is scarce, globally unequally distributed and the waste of water is still enormous. Certainly, the awareness of water as a vital commodity and investment product has gradually increased with the unique characteristic of not being a product that is subject to the market economy’s everyday rules. In many countries the water market is publicly regulated and independent of the current economic situation.
Water is going to be the commodity of the future. Demand for water has risen steadily in recent decades. On the one hand, this has to do with the ongoing population growth, but on the other hand with the steadily increasing prosperity in the still underdeveloped countries and the increasing consumption all over the world. More people need logically more water, but also more food, which in turn is produced with the help of water, and consumer goods that also have to be produced with the help of water. But above all, people need clean and drinkable water. That is why the treatment of wastewater and toxic industrial water, as it is especially needed in China, becomes a crucial pillar of investments in the water industry.
The goal of the United Nations was to reduce the number of people without access to clean drinking water and without access to sanitation to zero by 2025. However, it is already clear today that this goal will be clearly missed. Nonetheless, in order to come closer to this endeavor in the long term, investments in all areas of the water industry are absolutely necessary. Since the public sector all over the world cannot handle the growing water problem on its own and even seems to be overwhelmed, private capital from outside via the stock exchange is imperative. This does not only weaken ethical concerns about water investments, they are also counterproductive and make the global water problem even worse.
Thus, water is an investment topic that is perceived and treated differently than other investment stories on the stock market. Investments in the water industry should be perceived less than speculative and short-term investments. One reason for this is that the United Nations’ goal – to drastically reduce the number of people without access to clean drinking water – can actually be achieved in the long term. However, this requires companies that have the know-how and technology to implement these goals together with the UN and other organizations. However, companies have to be provided with capital via the stock exchange in order to make long-term investments in research and development.
Investments around the topic of water are characterized by the fact that they are long-term oriented. They also offer many interesting and profit-oriented opportunities for private investors. Investments in water are an essential component of an ecological and sustainable investment of the 21st century.