Scarce Resources

Question: Discuss about theScarce Resources. Answer: Scarcity of resources implies the presence of fewer resources than what is demanded or needed to fulfill human wants and needs. These resources can be from any source, be it labor, land or capital resources. The problem of scarcity reflects the need to make sustainable economic decisions to manage the availability of resources that are needed for human needs (DEsposito, 2012). In order to obtain scarce resource which is demanded there involves some sort of a trade off implying that all the objectives of the society cannot be achieved altogether, some need to be sacrificed. In the real world the problem of scarcity gives rise to competition for the scare resources. In such cases the determination of the market equilibrium price is a way to allocate the resources which are scarce. If a resource starts becoming scarce then its price rises, which signals the people to substitute the resource with other sources thereby in turn reducing the demand and boosting the supply. (Mildner et al., 2011) Now, we turn towards the resources that are considered to be mostly scarce in different countries around the world. If we consider natural resources, the six scarcest natural resources are water, natural gas, oil, coal, phosphorus and some rare earth elements like scandium and terbium. If we take the example of water, fresh water constitutes 2.5% of the worlds volume of water, out of which 70% is in ice form indicating that demand for water may soon exceed its supply. The oil industry also faces crucial scarcity as BP Statistical Review of World Energy stated that 188.8 million tones is the amount of the total global oil which is just enough for the proceeding 46.2 years if the global production stays at the present rate and same is for natural gas enough to satisfy needs for the next 58 years. Phosphorus is found in a small number of countries and is considered to be the element without which plants cannot live and is predicted to be running out in the next 50 to 100 years (Ruz, 201 1). As the population of the world keeps growing the farmland amount keeps falling short, making it difficult to feed people by growing crops. Having on effect on this scarcity of food is the scarcity of water, which is causing drought making it difficult for farmers to grow food. Deforestation is also directly affecting the scarcity of food resources as the lack of trees is causing an eco-system imbalance which in turn is interfering with the reproduction of wildlife giving birth to invasive species which have more negative effects than positive. If the imbalance of eco-system continues and at a faster rate then it shall cause a mass extinction (Reference.com). China which is the country producing 90% of the earths rare earth metals claims that the mines might run out of metal in the next 15 to 20 years (Nuwer, 2014). It is also stated that out of the total materials extracted (58 billion tones) and used in the year 2005, 43% was accounted for Asia, 13% for Europe and Latin America each and 3% by Australia and Oceana each. (Compass key trends). There are many regions and countries that have specific resources as scarce due to different consequences. For instance, China has a population of 1.3 billion to provide with food, education as well as health care and there is a significant scarcity of the provision of such resources in each of the areas. It is found to have low natural resources to population ratio with water, land as well as energy scarcity. It has 1/3rd of the worlds average per capita fresh water. Chinese also envy US of its abundance of resources with just a quarter of Chinas population and this gives rise to many resource conflicts and competitions between China and US which in turn again creates a scarcity of resources for the world. Education of high quality is also considered as a scarce resource of China with students competing for few best colleges or universities through the tough admission tests they face (Bloomberg.com). Other examples would be, Avian flu of 2012 in Mexico had wiped out millions of chic ken which had created a scarcity of eggs in Mexico that is considered to be its staple diet, water has become scarce in Gujarat of India due to politics revolving around the construction of a dam, in the Gulf Coast oil prices go up when refineries were incapacitated by hurricanes, Alavanyo in Ghana face a food scarcity because of a conflict which prevented individuals to go to their farms, Nigeria floods washed away farmlands creating food scarcity or deforestation in Thailand has resulted in scarcity of wood (Your Dictionary). Looking into the worlds countries suffering the most from water scarcity include United States which experienced recent droughts threatening its GDP growth, India where monsoon floods killed and displaced many, whereas increased water scarcity problem may also impact Chinas energy production. Bahrain, Jamaica, Singapore, Trinidad, United Arab Emirates, Qatar, Israel, Iran, Pakistan, Sub-Saharan African countries, Egypt, Bangladesh, India, China are some of th e top rankers with water scarcity (Reig et al, 2013). Competition and conflicts between many countries has given rise to price hikes of resources such as disputes over gas between Russia, EU and Ukraine, revolts for food in Haiti, Tunisia, and Algeria, conflict between US and China over export restriction on several metals, etc. There are also inter-state conflicts over water like that between India and Pakistan or in regions of Africa (Mildner et al., 2011). There are also risks and conflicts related to FDI in lands with Madagascar being a well known example. Africa, Zimbabwe, Asia and Central America are some of the top regions that had faced food shortages. Some recyclable resources are aluminum, plastic, steel or jute, paper, asphalt, glass etc. Efficient substitutes can be inexhaustible resources like hydroelectric, wind or solar power or timber (with proper management). Till now the most prevalent substitutes for non-renewable resources in form of renewable resources had been the usage of corn, sugarcane, soya-beans, and also palm oil for producing ethanol or biodiesel to substitute for diesel fuels and gasoline. Ways to fight resource scarcity crisis would be to develop institutions or socio-economic systems which would control continued growth of consumption of such material resources, as well as managing capitalism. Few of various reforms and policies taken by countries to tackle resource scarcity are: South Africa had adopted various reforms and policies to fight its water crisis scenario. It had come up with White Paper on Water Supply and Sanitation policy in 1997 which clarified needs of development and managing investments in this sector, leading to $700 million allocation of the state funds into basic sanitation and water development services (Appelgren G). Land reform in Zimbabwe reallocating land from white landowners to black farmers and investments of these farmers on land boosted the rural economy (Appelgren G). There had also been food aid programs from donor regions like Europe, Australia, North America and Japan to the recipient countries like South Asia, West Africa, Mongolia or Afghanistan. US had been one of the largest donors accounting for 50% of total donated in 2008 followed by EU with 20% (British geographer, weebly.com). UN initiatives towards water scarcity include like that of World Water Day 2007 stressing on the significance of water crisis as well as World day to Combat Desertification stressing on water scarcity and drought (UN.org, UNDESA). China is building the South to North Water Diversion Project (SNWDP) worth $62 billion considered as one of the largest projects expected to be completed in 2050 helping in linking rivers and diverting water from rivers in the southern region to the arid north. Apart from this it is also trying to manage the demand for water via efficiency and conservation measures spending $612.23 billion towards conservation of water as well as investing in renewable saving water like solar, wind, and sea water cooled nuclear power. Resource scarcity in Arab countries is also fought by initiations of IFAD investing billions in rural and agricultural development focusing on water related activities (IFAD, 2009). Affordable desalination approaches are also adopted by countries like China, Israel, Saudi Arabia and Australia (Drop4drop, 2014). Even if we consider the option for substitutes then in reality in todays world there is a lack of good substitutes present rather it would be more helpful if consumers found new ways of recycling and using resources with efficiency like that of US in 2009 recycled 25% of used computers and TVs (Nuwer, 2014). Hence, even though recycling or search of substitutes do not completely solve the problem of scarce resources, our individual contributions, sacrificing and curbing our unlimited wants, innovations, resolving of conflicts between nations can make us hope to see extension of the limited period for these resources to last. 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