{
  "title": "Macro-Criticality of Water Resources",
  "publication": "IMF Working Papers, December 5, 2025",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2025/12/05/macro-criticality-of-water-resources-572357",
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  "summary": "This paper examines the macro-criticality of water resources in the context of climate change. It summarizes the past and future trends of water scarcity and droughts and proposes a framework to analyze the macro-criticality and role of public sector engagement in the water sector.",
  "sections": [
    {
      "heading": "Overview and Purpose",
      "content": "- Examines the macro-criticality of water resources in the context of climate change.\n- Summarizes past and future trends of water scarcity and droughts.\n- Proposes a framework to analyze macro-criticality and the role of public sector engagement in the water sector.\n- Maps channels through which water resources affect macro-fiscal and balance of payments positions.\n- Develops an understanding of macro-fiscal exposure based on empirical evidence.\n- Synthesizes emerging insights from IMF-supported operations and capacity development activities to clarify the rationale and scope for IMF engagement in water-related policy reforms."
    },
    {
      "heading": "Key Findings and Insights",
      "content": "- Water scarcity and droughts have identifiable past trends and projected future trends relevant for macroeconomic stability.\n- Water resources influence macro-fiscal positions through multiple channels and can have balance of payments implications.\n- A formal framework can be used to assess macro-criticality and the appropriate public sector engagement in the water sector.\n- Empirical evidence helps quantify macro-fiscal exposure to water-related shocks.\n- IMF-supported operations and capacity development activities provide emerging practical insights for policy design and reform priorities in the water sector."
    },
    {
      "heading": "Framework and Analytical Contributions",
      "content": "- Presents a framework to:\n  - Analyze macro-criticality of water resources.\n  - Determine the role and scope of public sector engagement in water resource management.\n- Maps channels linking water resource dynamics to:\n  - Macro-fiscal outcomes.\n  - Balance of payments positions.\n- Uses empirical analysis to develop an understanding of macro-fiscal exposure to water shocks."
    },
    {
      "heading": "Policy Implications and IMF Engagement",
      "content": "- Clarifies rationale for IMF engagement in water-related policy reforms, informed by:\n  - The macro-criticality framework.\n  - Empirical evidence of fiscal and external exposures.\n  - Lessons from IMF-supported operations and capacity development.\n- Implied policy focus areas include:\n  - Strengthening public sector roles where macro-criticality warrants.\n  - Designing fiscal and external resilience measures to mitigate water-related shocks.\n  - Integrating water resource considerations into macro-fiscal surveillance and program design.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2025/12/05/macro-criticality-of-water-resources-572357"
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    "Authors: Suphachol Suphachalasai, Ximing Dong, Pedro Juarros, Junko Mochizuki, Christine J. Richmond, Sylke von Thadden-Kostopoulos",
    "Published: December 5, 2025",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229033534.001",
    "Examines the macro-criticality of water resources in the context of climate change.",
    "Summarizes past and future trends of water scarcity and droughts.",
    "Proposes a framework to analyze macro-criticality and the role of public sector engagement in the water sector.",
    "Maps channels through which water resources affect macro-fiscal and balance of payments positions.",
    "Develops an understanding of macro-fiscal exposure based on empirical evidence.",
    "Synthesizes emerging insights from IMF-supported operations and capacity development activities to clarify the rationale and scope for IMF engagement in water-related policy reforms.",
    "Water scarcity and droughts have identifiable past trends and projected future trends relevant for macroeconomic stability.",
    "Water resources influence macro-fiscal positions through multiple channels and can have balance of payments implications.",
    "A formal framework can be used to assess macro-criticality and the appropriate public sector engagement in the water sector.",
    "Empirical evidence helps quantify macro-fiscal exposure to water-related shocks.",
    "IMF-supported operations and capacity development activities provide emerging practical insights for policy design and reform priorities in the water sector.",
    "Presents a framework to:",
    "Maps channels linking water resource dynamics to:",
    "Uses empirical analysis to develop an understanding of macro-fiscal exposure to water shocks.",
    "Clarifies rationale for IMF engagement in water-related policy reforms, informed by:",
    "Implied policy focus areas include:",
    "**Working Paper**"
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