The world has entered an era of “global water bankruptcy” that is already harming billions of people, according to a landmark United Nations report. The study, published by the UN University Institute for Water, Environment and Health (UNU-INWEH), warns that many societies have long been using water faster than it can be naturally replenished.

As reported by the Guardian, the report identifies a shift from temporary supply issues to a permanent state of insolvency. This “water bankruptcy” occurs because many human water systems have passed the point at which they can be restored to former levels, with the climate crisis further exacerbating the problem by melting glaciers and destroying natural wetlands.

Photo: Photo by Oleksandr Sushko on Unsplash

Professor Kaveh Madani, the report’s lead author and Director of UNU-INWEH, stated that “many critical water systems are already bankrupt” and warned that “no one knows exactly when the whole system would collapse.” He explained that while not every individual nation is currently bankrupt, enough critical systems have crossed this threshold to fundamentally alter global risk through interconnected trade and migration.

The human toll of this shift is already widespread. The investigation reveals that 75% of the global population lives in countries classified as water-insecure, and over half of global food production is at risk because it relies on regions where water storage is declining or unstable. The report also highlights a sharp rise in water-related conflicts, which have increased from 20 in 2010 to more than 400 in 2024.

Physical evidence of this bankruptcy is visible in the rapid depletion of the planet’s long-term “savings accounts.” The UN researchers found that half of the world’s large lakes have shrunk since the early 1990s. In many regions, the excessive extraction of groundwater is causing the land itself to sink; for example, Mexico City is currently subsiding by roughly 21cm per year.

To manage this era of insolvency, the report calls for a “fundamental reset” of global water protection. This includes cutting water withdrawal claims to match today’s degraded supply and transforming water-intensive sectors like agriculture. As UN Under-Secretary-General Tshilidzi Marwala stated, managing this bankruptcy fairly is now “central to maintaining peace, stability and social cohesion” as water becomes a primary driver of displacement and fragility.