Globalization is characterized by the production and movement of goods and services around the world, and water is a key ingredient either directly or indirectly in almost every good produced. Consequently, the movement of goods effectively results in the movement of water around the world. Existing patterns of trade, however, are not necessarily water-efficient. Many factors are at play when global trade decisions are made, and water is rarely one of them. The concept of “virtual water” – which measures the amount of water embedded in the production of food and other products – has been introduced as a way to evaluate the role of trade in distributing water resources. By allowing those living in water-scarce regions to meet some of their water needs through the import of waterintensive
goods, some have argued that international trade can provide a mechanism to improve global water-use efficiency (Allan 1993). Others, however, have posited that it simply externalizes the environmental burden of producing a particular product. In any case, the facts suggest that countries’ relative water endowments are not dictating global trade
patterns. Indeed, three of the world’s top ten food exporters are considered water scarce, and
three of the top ten food importers are water rich (World Economic Forum Water Initiative 2011).
Furthermore, globalization increases dependency on others for essential goods and increases vulnerability to external water scarcity (Hoekstra and Mekonnen 2012).