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NEWS: Financier sees profit in water markets, bottled water, water technologies

Ziad Abelnour

Ziad Abelnour

Ziad K. Abdelnour is a self-described “deal maker, trader and financier” and is the president of the New York-based investment firm Blackhawk Partners, Inc.

Last month Abdelnour wrote, “An estimated 1/3 of the world’s population currently lives in water-stressed or water-scarce countries. On the current trajectory, it is estimated…that by 2025 countries will have water demand in excess of supply and 64% of the world’s population will be under significant pressure. …Given these alarming statistics, we at Blackhawk strongly believe that water is in fact turning into the ‘New Gold’ for this decade and beyond. No wonder ‘smart money’ is aggressively moving in this direction. …Remember that water, like oil, is finite. There is only so much ocean saltwater, glacier freshwater and water in the air, while global consumption is growing twice as fast as the world’s population.”

“Putting our money and brainpower where our mouth is, we are actually involved in the recapitalization of a major water bottling facility in Iraq as we strongly believe that the Middle East at large…will need double the amount of water it used in the past. …No wonder that the bottled (packaged) water industry; worth roughly $85 Billion in annual revenues, has been growing at an average rate of 8% by volume per annum over the last decade. …The industry outlook for growth continues to be very strong for water worldwide, mainly due to health benefits of drinking water for developed market consumers, and to avoid ill-health for the emerging market consumers.”

He adds, “New water management technologies are the key to managing water scarcity. …(Investor) Warren Buffet last year’s buyout of a water treatment provider, Nalco Holdings Company, (added) to other water-related investments in his wildly successful portfolio. …Nalco is teaming up with organizations like the World Wildlife Fund to help develop ways to conserve water. The company’s stock price has doubled over the past year.”

Water-technology.net, a global water industry news source, reported last March that, “Abdelnour believes that in recent years international law has laid the foundations for the future trade of water, saying ‘50% of World Bank loans issued in 2002 to developing countries contained a clause that requested privatisation of water services,’ continuing, ‘In addition to international institutions pushing for privatisation, trade agreements in the 20th Century have also created the legal framework for allowing the sale of water.'”

Also in that report, on the recognition of water as a human right, “Abdelnour (says) this fails to take into account a number of factors: ‘Today, most water goes through a complicated industrial process that begins with its extraction and ends in a complicated process involving pipes, dams and other sorts of unnatural facilities… In general these considerations involve the use of land, labour and capital thereby replacing the notion of a common resource into a value based product.'”

And on water markets, the report says, “While water markets have been implemented in countries such as Chile, Spain, Brazil, Australia and the USA, (Aline) Baillat (author of a paper on the trade in water) points out that, for now, water markets remain very localised, although ‘it is increasingly argued that water should be traded across borders as well’. Abdelnour concludes that emerging markets – where per capita consumption is low and pollution levels are high – are ripe for water industry growth, particularly areas like the Middle East where significant wealth and population growth are fuelling the need for water.”

To read Abelnour’s full commentary, go to http://www.articletrader.com/finance/investing/is-water-the-new-goldziad-abdelnour.html. The Water-technology.net article can be read at http://www.water-technology.net/features/feature113479/.

The environmental magazine The Ecologist reports on Abelnour and water trading today. For subscribers, you can read that article at http://www.theecologist.org/investigations/science_and_technology/1063080/water_trading_how_the_worlds_most_vital_resource_is_up_for_sale.html.

For more on the Council of Canadians:
-campaign against water markets, see http://canadians.org/watermarkets
-work against bottled water, http://UnbottleIt.ca
-support of the right to water, http://canadians.org/RTW
-concerns about the water technology market, http://canadians.org/blog/?p=6845