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By Kevin MacDonald
When we speak of the Middle East, we often think of oil as the area's most precious commodity. The reality is Middle Easterners themselves view water as their most valuable resource, says Asghar Sabbaghi, professor of decision sciences at Indiana University South Bend
 Sabbaghi |
Water has become the oil-rich region's primary concern over recent years, due to fears of a water shortage.
Concern that usable and drinkable water will run out in the Middle East and other countries has reached an all-time high. Sabbaghi believes the water industry must restructure the way it manages water resources and sells water to various users for domestic, industrial, commercial and agricultural purposes.
Sabbaghi's call for a differentiated scale of water purification and use--selling water based on different uses at different rates--is the basis of his research on privatizing the water industry. He believes privatization is necessary to modernize the industry and, most importantly, conserve the world's most precious resource--drinking water.
"The water used to wash your car, water your lawn or to do a load of laundry doesn't need to be as pure as the cold glass of water that quenches your thirst on a hot, summer day," Sabbaghi said. "The water used to clean boilers at a food manufacturing plant does not need to be as pure as the water which goes into the food products themselves."
"One of every five people live in countries with inadequate fresh water," he said. "And in 25 years, the ratio is estimated to be one in every three people."
Traditional management of the water industry--supply-oriented, public ownership and management--is antiquated in the 1990s when considering the technological advances in the world.
"We have tons of information technologies in business, but in the water industry we haven't done that," Sabbaghi said. "Water is an economic resource, and we have to think of economic efficiency."
Great Britain and France are two examples Sabbaghi cited as countries that have successfully modified their water industries. All the water and sewerage services in Great Britain have been provided by private companies since 1991. Since then, progress has been made in environmental and economic regulation in water quality, pricing and customer service. France, in the meantime, retains ownership of the water supply but has placed the management reigns in the hands of the private sector.
In the United States, Sabbaghi believes that private ownership, along with a market-oriented approach, are the primary steps needed to provide economic incentives for both suppliers and consumers to achieve efficient management of water resources.
"Water efficiency is gaining popularity worldwide because so many countries are experiencing shortages, or the threat of such," Sabbaghi said.
Water resource management has become a cornerstone of Sabbaghi's professional work. He recently co-authored the second edition of Economics of Water Resources: From Regulation to Privatization, first published in 1994 (Kluwer Academic Publishers), with IUB economist Nicolas Spulber.
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