Water bankruptcy: UN report signals a post-crisis era for global agriculture

For decades, global agriculture has expanded on the assumption that water systems could sustain growing withdrawals and continue to supply reliable volumes of water over time, supported by infrastructure development, efficiency gains and short-term crisis management. 

The latest United Nations report makes clear that this assumption is no longer valid. In many regions, agriculture is no longer operating in a temporary water crisis but within a state of global water bankruptcy, where long-term water use has exceeded renewable inflows and safe depletion limits. 

Global Water Bankruptcy: Living Beyond Our Hydrological Means in the Post-Crisis Era released on January 20, 2026 by United Nations University Institute for Water, Environment and Health, warned that the planet has entered the ‘Global Water Bankruptcy era’ and in many areas, rivers, lakes, aquifers, wetlands, soils and glaciers, have been damaged beyond realistic prospects of full recovery. 

Roughly 70 per cent of global freshwater withdrawals are used for agriculture, much of it in regions where water availability is already declining or increasingly variable.

Around three billion people and more than half of global food production are located in areas where total water storage, including surface water, soil moisture, snow, ice and groundwater, was declining or unstable, the report noted. 

It categorised the scale of exposure — more than 170 million hectares of irrigated cropland, roughly the combined land area of France, Spain, Germany and Italy, as being under high or very high water stress.

Global freshwater withdrawals over time

Over 50 per cent of global agricultural land was already moderately or severely degraded, undermining soil moisture retention and accelerating the transition of drylands toward desertification. Global salinisation alone has degraded about 82 million hectares of rainfed cropland and 24 million hectares of irrigated cropland, together more than 100 million hectares of cropland, eroding yields in some of the world’s key breadbaskets. 

The report warned that as water-stressed basins struggle to maintain historical levels of agricultural production, food insecurity and livelihood losses were becoming more widespread. Declining water availability was already contributing to reduced yields, higher production risks, and rising volatility in food systems, particularly in regions heavily dependent on irrigated agriculture. 

In several parts of the world, the erosion of water security was translating directly into reduced household food access and income instability for rural communities.

But this was not all. These dynamics were also driving broader socio-economic impacts like distress migration and internal displacement, especially in sub-Saharan Africa, South Asia, and Latin America. 

The report described this as a shift in which the degradation of freshwater systems was pushing societies toward a socio-economic failure mode, with implications for food security, labour markets, and demographic patterns at both national and regional scales.

Drought, once seen primarily as a climatic hazard, was increasingly anthropogenic in both origin and impact. In 2022–2023, more than 1.8 billion people lived under drought conditions. Annual global drought-related damages now approach $307 billion, exceeding the GDP of most UN Member States. These losses are driven not only by rainfall deficits, but by decades of land degradation, groundwater depletion, and infrastructure and institutions designed for hydrological conditions that no longer exist, the report found. 

The cryosphere added another layer of risk. According to the report, since 1970, the world has already lost more than 30 per cent of its glacier mass, and several low-latitude mountain ranges were on track to lose functional glaciers entirely within decades. 

These glaciers once acted as natural savings accounts, releasing meltwater during dry seasons. Around 1.5 to 2 billion people depend at least partly on these high-mountain water towers, particularly in basins such as the Indus, Ganges-Brahmaputra, Amu Darya, Yangtze, Yellow and major Andean rivers. As glacier-fed systems pass “peak water” and enter long-term decline, irrigated agriculture faces shrinking and increasingly unreliable late-season flows. 

“For irrigated agriculture and hydropower in already stressed basins, this means that historical assumptions about reliable late-summer water supplies are no longer valid. This creates major operational and water allocation challenges as the existing infrastructure and institutions have been designed to fit the historical conditions that no longer exist,” it said. 

For many Global South countries, the report noted, water constraints were already shaping food production choices, rural livelihoods, and macroeconomic stability. In water-bankrupt systems, decisions about crops, irrigation, and land use were not separated from questions of employment, social protection, and political legitimacy. Yet these linkages were often weakly reflected in international policy frameworks, which focus primarily on emissions trajectories, technological mitigation pathways, or urban service delivery.