VIRTUAL WATER TRADE AND WATER ENDOWMENTS IN SOUTHERN AFRICA

Greenwell Matchaya, Charles Nhemachena and Sibusiso Nhlengethwa

International Journal of Food and Agricultural Economics (IJFAEC), 2019, vol. 07, issue 01

Abstract: The virtual water content of a product (a commodity, good or service) relates to the amount of water that is used in its production. Virtual-water ‘trade’ represents the amount of water embedded in products traded. With this background, countries that export agriculture commodities also export water. The purpose of this paper is to explore trends in virtual water trade in the Southern Africa Development Community (SADC) region focusing on Malawi, Mozambique, Zimbabwe and Zambia, in order to understand whether water rich countries export more water into the SADC through virtual water trade in cereals. The analysis is based on data on trade volumes, crop yields, and crop water requirements. The results show that South Africa, Zambia and Malawi, are the main exporters of virtual water embedded in Maize, Soybean and Groundnuts into the SADC. The Results also show that while virtual water trade has generally been increasing over time, an inquiry into whether water rich countries relatively export more water intensive commodities such as groundnuts and soybean, yields mixed results. For example groundnuts virtual water movement is stronger from both water scarce and water rich places of the SADC implying that other underlying factors than just water endowments may determine virtual water trade flows. For countries to improve water resource allocation through trade, more advocacy and analysis may be useful.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Environmental Economics and Policy; Farm Management (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ijfaec:283881

DOI: 10.22004/ag.econ.283881

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