World enters era of 'global water bankruptcy'
Feb 27th 2026
A UN-linked study says many water systems are now effectively 'bankrupt' because overuse and irreversible damage make a return to past water levels infeasible, prompting a move from crisis management to planned recovery.
- UN researchers warn many regions now face persistent water shortages that cannot return to historical baselines.
- Water bankruptcy is defined as both insolvency from overwithdrawal and pollution and irreversibility from damage to wetlands, lakes and other water natural capital.
- More than half of the world’s large lakes have declined since the early 1990s and about 35 percent of natural wetlands have been lost since 1970.
- Nearly three quarters of the global population live in countries classified as water insecure, and about 4 billion people experience severe water scarcity for at least one month each year.
- Drought impacts cost an estimated $307 billion per year and the heaviest burdens fall on smallholder farmers, Indigenous Peoples, low-income urban residents, women and youth.
- The report calls for a shift from short-term crisis fixes to structured recovery that stops depletion, protects essential services, restructures unsustainable claims and invests in rebuilding.