Water is often invisible in the global economy. Yet behind the food we eat, the clothes we wear and the minerals powering the energy transition are complex supply chains that depend on vast quantities of freshwater.
Over the past year, the Fair Water Footprints (FWF) initiative has explored these connections through a series of major research publications, examining both the changing geopolitical landscape surrounding water and trade and, in detail, the water footprints associated with three globally important sectors: food and agriculture, textiles and minerals.
Together, the research paints a compelling picture: water security is no longer only a local environmental concern. It is increasingly an issue of trade, economic resilience, financial risk and geopolitics.
A changing geopolitical landscape
The starting point is a global trading system undergoing significant change. Making water use in global trade more sustainable, published by Chatham House as part of FWF, describes water as the “forgotten input” in global trade. Water is fundamental to producing and transporting goods, yet its value and availability are rarely adequately reflected in trade policy, corporate sourcing or investment decisions.
At the same time, growing geopolitical fragmentation is making collective responses more difficult. Governments are reassessing strategic dependencies and prioritising resilience and security, while climate change and deteriorating freshwater systems are adding further pressure. The research argues that this new geopolitical reality makes understanding the “virtual water” embedded in internationally traded goods more important, not less.
The accompanying Water, Trade and Capital: How Water is Reshaping Geopolitics, Supply Chains and Financial Risk from CDP develops this argument further, examining water not simply as a sustainability issue, but as an increasingly important determinant of economic competitiveness, supply-chain resilience, strategic autonomy and financial risk. Recent shocks, including drought affecting major trade routes, conflict and changing patterns of tariffs and trade, underline the vulnerability of globally interconnected supply chains when their underlying natural-resource dependencies are overlooked.
Following water through global supply chains
FWF research has also taken a deeper look at what this means in three sectors central to the global economy.
For food and agriculture, the scale of the challenge is considerable. Food systems account for almost 70% of global freshwater withdrawals, while international agricultural trade effectively transfers huge quantities of virtual water between producer and consumer countries. The water footprints of global food and agriculture trade shows that, rather than production necessarily shifting towards water-abundant regions, water-intensive goods are frequently sourced from places already experiencing water scarcity and climate vulnerability.
For textiles, water dependencies stretch across the entire product lifecycle, from cotton and other raw materials through manufacturing and dyeing to consumption and disposal. The water footprints of global textiles trade demonstrates how these pressures can be geographically distant from the consumers of finished products, while their consequences are experienced locally through depleted or polluted water sources and risks to communities and ecosystems.
And in the minerals sector, growing demand for materials critical to the global economy and energy transition brings its own water challenges. The water footprints of the global minerals trade highlights how extraction and processing can contribute to water scarcity and pollution in producer regions, creating risks for communities and ecosystems as well as the reliability of strategically important mineral supply chains.
From hidden dependency to shared responsibility
Across all five publications, a common message emerges. The benefits of international trade and consumption are often separated geographically from their water impacts. Water stress can effectively be embedded in global supply chains, while the environmental and social costs remain concentrated in producing countries and communities.
Addressing this requires looking beyond efficiency within individual factories, farms or mines. The research points towards a broader approach involving governments, companies, investors, financial institutions and civil society, with greater transparency around water footprints, stronger water governance and due diligence, basin-level understanding of risk, better corporate water stewardship and closer cooperation between producer and consumer countries.
Taken together, the research makes the case at the heart of Fair Water Footprints: the water used to produce internationally traded goods cannot be treated as someone else’s problem. Building more resilient global economies means making the water hidden within trade visible, and ensuring that its use is sustainable, equitable and fairly governed.
Explore the research
Together, these five publications provide a comprehensive picture of how water connects global trade, geopolitics, supply chains and economic resilience, alongside deeper analysis of the water footprints of three critical sectors. Read the full research: Water, Trade and Capital: How Water is Reshaping Geopolitics, Supply Chains and Financial Risk (CDP); Making water use in global trade more sustainable (Chatham House); The water footprints of global food and agriculture trade (Chatham House); The water footprints of global textiles trade (Chatham House); and The water footprints of the global minerals trade (Chatham House).