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This is an archive article published on June 11, 2012

8216;Rivers crucial for emerging markets8217;

Poor management of water resources could stifle economic growth,says HSBC report.

Poor management of water resources could stifle economic growth in some of the world8217;s most rapidly developing economies including India,according to research commissioned by banking group HSBC.

The study,by consultancy Frontier Economics,estimates that by 2050 the world8217;s ten most populous river basins will be producing a quarter of the globe8217;s gross domestic product,compared with 10 percent now.

But seven of them will be facing water scarcity without significant investment in better water management.

This could mean the GDP growth expected in the river basins would not materialise 8211; and would therefore mean wider forecasts for emerging markets will not be achieved,the report said.

The key river systems identified by the study are mostly in China,India and North Africa. They are the Ganges,the Yangtze,the Indus,the Nile,the Huang He Yellow River,the Huai He,the Niger,the Hai,the Krishna and the Danube.

HSBC published the report on Monday alongside plans to invest 100 million via the WWF,WaterAid and Earthwatch charities to improve access to safe water in these river basins,which supply some of the bank8217;s most important markets.

This is a very strategic commitment,said Nick Robins,head of the bank8217;s climate change centre.

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The report estimates that every dollar spent on improving access to safe water and sanitation gives an average return of 5 in terms of economic activity.

On a global basis,providing universal access to safe water and sanitation could boost the world8217;s GDP by 220 billion a year,the report said. The gain in Brazil,India,and China alone would be more than 113 billion.

 

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