The next scourge to afflict the global economy after soaring oil and food prices will be a surge in the cost of water brought on by growing scarcity, one of the world’s biggest companies warned yesterday.

General Electric, the US industrial group, said it would cut its own use of water by 20% by 2012 and export water-saving and recycling technology to countries - often emerging economies - hit by shortages. Jeff Immelt, chief executive, said in Beijing: “We believe that, just as greenhouse gas emissions have been a big societal challenge, the same thing is true for water.”

Lorraine Bolsinger, vice-president of GE’s Ecomagination green technology division, added: “There is going to be a price on water that is going to reflect its scarcity in a way it doesn’t today. We’re going to see that change over time - certainly in emerging markets.”

The move by GE comes as scientists are warning that 50% of the world’s nations will be hit by water shortages by 2025 and 75% by 2050. Barcelona is already importing water from France.

Drought, already one source of surging food prices and water shortages could prompt fresh outbreaks of war and terrorism as global warming, if unchecked, spreads desertification around the world and causes increasing crop failures, they say. A billion of the world’s poorest people drink unsafe water, according to Unicef. Senior UN officials warned MEPs this year that nuclear power plants in Europe and the US could face shutdown because of a lack of cooling water, while the switch to biofuels was proving a big drain on dwindling supplies.

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