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VIEW: ‘Don’t export water, make the jobs come to the water’, says Reguly

Eric Reguly

Globe and Mail columnist Eric Reguly writes, “A UBS Investment Research study implies that water-intensive industries will have to migrate from water-scarce to water-rich regions of the planet. The migration could be huge because key regions of India, South Korea, Taiwan, Australia, the Middle East, South Africa and—believe it or not—Brazil are also short of water. Which brings us to Canada.”

“China’s semiconductor industry shares a troubling feature with China’s steel industry: Both use outrageous amounts of water in a country where water resources are getting scarce. (A standard circular wafer-sized semiconductor with a diameter of 300 millimetres requires almost 10,000 litres of water.) Once you understand that China has to phase out its thirstiest industries or risk starving itself, you might see how water-rich Canada could emerge as one of the world’s great manufacturing countries, a role it’s given up in recent decades in favour of digging up oil and minerals. …Canada, according to our federal Environment Ministry, has the second-largest amount of renewable water resources (after Russia) among the G8 countries plus Australia and Sweden.”

Given this water abundance, Reguly argues, “Sunset industries such as steel and chemicals could revive in Canada, as could food processing and beverages. It takes up to four litres of water to make one litre of bottled water, largely because of the plastic container. Canada could even emerge as a semiconductor manufacturer.” As a selling point, he notes, “Suncor, the oil sands giant, is one of the world’s most water-intensive companies, as measured by direct water withdrawal per $1 million in revenue. Teck Resources is another hog. But water scarcity isn’t an existential risk for companies here…”

“Every few years, some Canadian entrepreneur hatches an idea to export bulk water to the United States or elsewhere by pipeline or tanker ship. Each effort has failed. But with bulk-water export legislation open to interpretation, and the United States getting thirstier, the next attempt could succeed. That would be economic stupidity. Best to make the jobs come to the water instead.”

This week, the Council of Canadians issued a report warning about the use of water in exports, the very idea Reguly promotes in his column. Leaky Exports: A portrait of the virtual water trade in Canadahighlights the daily loss of massive amounts of Canada fresh water used to produce commodities, minerals and energy for export. One of several major findings in the report is that Canada is the second net virtual water exporter in the world. Canada’s net annual virtual water exports (exports minus imports) amount to just under 60 Bm3 (billion cubic metres), which is enough to fill the Rogers Centre in Toronto 37,500 times. To read our report, please go to http://canadians.org/media/water/2011/25-May-11.html.

Reguly’s column can be read at http://www.theglobeandmail.com/report-on-business/rob-magazine/china-wants-to-drink-our-milkshake/article2036428/.