The Transboundary Effects of Climate Change and Global Adaptation: The Case of The Euphrates-Tigris Water Basin in Turkey and Iraq

Drought has erupted across the Middle-East, as a result of climate change and global warming, leading to a considerable reduction in rainfall and snowfall, as well as a substantial drop in water resources. Climate change is, without a doubt, one of Iraq’s most pressing issues, with considerable negative consequences for the environment, water resources, and the economy, particularly in the agricultural sector. With a growing global population and other factors, the effects of climate change, water ownership and distribution will certainly become more critical. The EuphratesTigris water basin is a major source of water supply for Turkey and Iraq, where the latter is a downstream riparian country and the former is an upstream country. Turkey is most vulnerable to climate change as the country will experience a substantial decline in the annual surface runoff. However, Turkey will suffer less than Iraq, which as a downstream country, relies primarily on the water released by Turkey as the upstream country. The empirical analysis relies on data from the Iraqi Household Socio-Economic Survey (IHSES) conducted in 2012 and the 2017 Rapid Welfare Monitoring Survey. We apply simultaneous unrelated regressions equations (SURE) with Probit models. We further extend the analysis by incorporating an instrument variables (IV) approach considering the population of the nearest Turkish city to where the dam is located, the water capacity, and the distance between this dam and the respondent’s governorate in Iraq. Similarly, we construct other two instruments considering the distance between the dams in Iraq and in Syria and the nearest governorate along with the dams’ water capacity and the population of the governorate in Iraq. The findings show a significant impact of climate change-related shocks on income, assets, food production and stock, and the overall economic situation of households in Iraq.