Cyprus - inaction, a building boom, lack of investment ... droughts, lead to predictable water shortages / rationing

It was evident in November 2007 that water shortages loomed in Cyprus.Vlassis Partassides, head of water management at Cyprus’s Water Development Department, looking at resevoirs 10% full said in a Reuters inetrview “If the drought continues for a fourth year, the consequences will be very severe.”

As of today the 17 resevoir systems with a capacity of 273,636 million cubic metres (MCM) have current stocks of 27,972 MCM or just 10.2% of their capacity and the maximum they have held throughout all of 2007 was 72,20 MCM.The country has , with desalination and increasingly drying and salinated boreholes approximately 50 MCM to last until the end of the year; realistically, it needs at least 66.7 million cubic meters.

Since 1972, rainfall has decreased 20% and runoff into reservoirs has decreased by 40%. Briefly That is Cyprus has now roughly 40% less water than had been assumed based on pre-1970 rainfall records.

Costas Papastavros, head of the Cypriot national climate change unit said desertification is also becoming a serious problem. "It is not just that we do not have water in dams for irrigation, but we are looking at a decline in the productivity of soil, and we have a tremendous problem.”

The demand for water in Cyprus, for now, outstrips supply. Experts estimate the island will need almost 180 million cubic feet of water until the new year. Kouris, one of the island’s largest and most important dams, was in November 2.5% full, with 3.23 million tons of water. It is the principal supply for Nicosia and the heavily populated (and tourist areas) southern districts of Limassol and Larnaca.

Indeed the development of water supplies has been a triumph historically - ""No drop of water to the sea". From surface reservoirs from 6 6 MCM in 1960, total capacity has reached 307,5 6 MCM today. Only when it rains.

The desalinization plants , the first which opened on 1 April 1997 at Dhekelia, (40,000 C) and the plant at Larnaca Airport ( 50,000 m3/day ) opened 4 years later , can , on continuous operation only supply 45% of demand, and fuel oil input costs have rocketed.

No water ? Panic! Panic! Panic! ration / fine / threaten

So water rationing has been introduced again from this Wednesday March 26th , water 3 days a week for 12 hours per day. Sufficient to fill a 1 ton rooftop tank but hopeless for a family of say 5. Of course some people have installed extra tanks over the years and this results in constant low water pressure when water is available. Hosepipe usage is banned with a fine of C£50.

Pipelines will be constructed to the resevoirs to take 8 MCM of water shipped from Greece , but this will not arrive for 5 months.For the water to be transported, a 400 meter pipe plus a four kilometer conveyor needs to be built. It will take at least five months for this supporting infrastructure to be built. (Costs ? No-one is saying, or who will be paying - sidelong glance to Brussels ?)

A new desalination plant being built at Episkopi will be uprated to double the daily output from a 40,000 m3/day to 80,000 m3/day which may be operating by October when all the tourists have gone home.

Oh! There's a masterstroke in the plan. An awareness campaign - TV ads.More TV ads, maybe some on the endless pop Radio programs.

Agriculture hit hard

The water scarcity has been disastrous for the country's agriculture, as desalinized fresh water is too expensive to use for irrigation.

To make problems worse, the liberalization of the Cypriot import regime under EU membership has allowed foreign competition in the domestic fruit and vegetable market. TYHis has also been swollen by lower cost non European exporters such as Syria, Egypt and Israel . Potato farmers, whose concentration in the "Kokkinokhoria" (red soil villages) also leads to manipulation of subsidies and they have become adroit at obtaining State subsidies.

Now however , less potatoes are bought by increasingly fastidious housewives with clods of earth on them , and supermarkets want smaller potatoes for ease of packaging in 2 - 2.5 KG quantities.
A study by Protonique SA in 1998 a qualitative appreciation of the supply of potable and non-potable water in Cyprus updated by EnviroTech Limited, Larnaka, Cyprus is available here. It hs been lying around Government offices for a long time. Ignored.
http://www.cypenv.org/cyprus_water/

The smart money will be importing bottled water. In quantity. Probbly with funny Russian labels.

Georgia's IDS Borjomi Group have just bought bought Georgian sourced Edelweiss bottled water off Gazprom for an estimated $25-30 million. It is banned in Russia.

Vagit Alekperov's LUKoil owns the oil industry in CYprus ... must give him a call to see what he intends to do about selling water. probbly catch him in the Turkish casinos celebrating his stunning deal in Iraq which the Western Press are studiously ignoring. Thursday, March 27, 2008 - LUKoil revive and seal a deal with Maliki and Talibani for Western Qurna-2 field - Russia writes off US$12 Bn debt to Saddam

Mortgage market in the UK remains sound

The Major British Banking Groups (MBBG) account for some two-thirds of all mortgage lending outstanding and around 70% of gross lending. Additionally, they provide over half of all consumer credit outstanding and, within that, some 70% of all card credit. They include twelve of the fifteen largest mortgage lenders in the UK: Abbey, Alliance & Leicester, Barclays and Woolwich, Bradford & Bingley, HBOS (through Halifax and Bank of Scotland), HSBC Bank, LloydsTSB (through Cheltenham & Gloucester), Northern Rock, Royal Bank of Scotland and National Westminster.

1. Today they announced that January's gross mortgage lending was £16.6 Bn. and dropped 9% to £14.9 Bn in February 2008 (Feb 2007 = £ 14.0 Bn.)

2. 167,000 mortgages were approved (for all purposes) in February with an average loan approved for house purchase of £150,400, some 14% higher than a year earlier. It took 9 years for mortages to double from £50K to £100K and 4 years to rise to £150K. The total figure included new loans of 47,365 a 35% fall from the 72,339 home loans February 2007. When the crooks at Northern Wreck were lending to anyone who walked through the door and took 20% of the UK market)

3. Nett mortgage lending (gross lending minus repayments and redemptions) rose by £5.2bn, (Januarys increased by £5.4bn). The annual growth in net mortgage lending continued at around 14%.

4. Credit card borrowing was unchanged (Actually declined by £4 Mn.) in the month, while other loans and overdrafts fell by £0.2bn. New borrowing on credit cards totalled £6,224mn in February; 7% lower than February 2006. (This compard with increase in mortgage lending shows how borrowers prioritise their credit needs - housing is No 1 - belt tightening not wage increases driving growth)

5. Compared to February 2006, House purchase approvals declined by 5% in number and 8% in value in February year on year.Remortgaging approvals were up 6% by number and up 22% by value. Approvals for equity withdrawal ( A species of theft from the elderly - the first tranche of mortgages sold off by Northern Wreck to Sacks of Gold) were unchanged by number but 10% higher by value.

Which suggests that the housing market is firm and that some degree of rigour has been attached to loan approvals, which was long overdue. There appears little evidence of any decline in prices or willingness to adopt loans for £150,000. (Average household income (NIS) is approx £27,000) , this average value has increased in 12 months by 14% - well in excess of any rise in national incomes.

Joke of the Week

``I would be surprised if, in a few years time, house prices are markedly above where they are now,'' Bank of England Governor Mervyn King said on March 26 to Commons Treasury Select Committee with members of the Monetary Policy Committee in tow - including the hapless and hopeless Sir John Gieve.

We are stuck with this incompetent twat for 5 more years - even former MPC member DeAnne Julius said the BOE isn't cutting interest rates fast enough said Mervyn King was "behind the curve".

The UK’s deficit on trade in goods and services was £4.1 billion in January. The deficit on trade in goods was £7.5 billion, and the surplus on trade in services was £3.4 billion.

As indigenous energy sources, oil/gas/coal decline, and imports rise this gap will inexorably rise.

King's response is to throw money out of the helicopters at the banks, the pound declines (from 1.36Euros to 1.26 in the last 3 months)from 1.47 Euros to 1.26 in 12 months.

And inflation roars away ... Lordy Lord "Don I gotta Winner" King of the Bank said at the Mansion House 16th June 2007...

"Our central view remains that inflation will fall back this year as the rises in domestic gas and electricity prices last year drop out of the annual comparison, and the recent cuts in prices feed through to household bills."

What a twat.

In a trading statement this morning Northern Foods PLC hid away a little nugget ..."Average prices were 7.5% higher as Northern Foods recovered the hike in raw materials costs from its customers."

Friday 8.30 pm GMT ... £ closed against the € down 0.092 or 0.75% @ € 1.26215 lowest ever.