The Paradox of the Virtual Water Trade Balance in the Mediterranean Region

Alexandros Gkatsikos and Konstadinos Mattas
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Alexandros Gkatsikos: Department of Agriculture, Faculty of Agriculture, Forestry and Natural Environment, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece
Konstadinos Mattas: Department of Agriculture, Faculty of Agriculture, Forestry and Natural Environment, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece

Sustainability, 2021, vol. 13, issue 5, 1-14

Abstract: Climate change, water shortages and desertification threaten the economic and environmental sustainability in the Mediterranean. Limited rainfall and higher temperatures put agricultural production, which relies on water availability, in jeopardy. Thereupon, Mediterranean countries pursue agri-food resilience and water preservation through efficient water policies. Hence, water-deprived areas ought to import rather than produce water-intensive products to maintain water inventories and sustainability consequently. As this study examines the water sustainability for a Mediterranean water-scarce region with a particular focus on agriculture, the virtual water trade balance explores this hypothesis. A regional input–output model is constructed, and then total water consumption and the virtual water flows for each economic sector are estimated to determine the virtual water trade balance of the economy. Results indicate that the study area has a trade deficit and struggles economically but is a net importer of virtual water and secures water sustainability. As this virtual water deficit relies heavily on agriculture and originates in vast total water consumption rather than a large trade deficit, a paradox occurs; water-intensive cultivations and animals that consume 91.75% of water resources end up appearing to be water-saving. Further research is needed to strike a balance between economic growth and environmental protection.

Keywords: virtual water trade; sustainable agriculture; Leontief paradox; input–output model; Mediterranean; peri-urban agriculture (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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