Food insecurity and water management shocks in Saudi Arabia: Bayesian VAR analysis

The existing conditions of domestic agricultural production and the resulting products will not be able to fruitfully address the increasing food demand due to the limited fertile land and water resources in Saudi Arabia. Moreover, the escalating threat of a hotter climate, the deterioration in precipitation, and harsh droughts in Saudi Arabia have reduced the predictability of water management efficiency and resulted in the exhaustion of water bodies and serious degradation of ecosystems that have directly affected agricultural systems and indirectly, food security. This study also aims to assess the impact of water efficiency on food insecurity in Saudi Arabia. The study applied the Bayesian Vector Autoregressive (BVAR) model for the reference period for the data extended from 2000-2020. Likewise, we used both impulse response functions (IRFs) and forecasting variance error decomposition (FVED) through 1000 Monte Carlo simulations according to the BVAR model to examine both the response of food insecurity to the shocks on water management efficiency used for various purposes and the decomposition of error variance in food insecurity. The results show that food insecurity was not observed throughout this study. The results of the BVAR analysis indicate that in the short run, the coefficients of water use efficiency are significant based on the Food Insecurity Multidimensional Index (FIMI). Also, the BVAR model provides a better forecast with an interdependence on water use efficiency for agricultural purposes and FIMI. Moreover, the results obtained from IRFs have shown a significant effect of water efficiency on FIMI. Water use efficiency for agriculture and industrial purposes reduces food insecurity while increasing water for services use increases food insecurity. Water use efficiency is the key factor affecting food insecurity in the short run. The results reveal that the water use efficiency shocks will decrease food insecurity. The shocks experienced by food insecurity can be predicted as self-shock over a span of ten years. Emphasis is given to the task of water management that may support food security in Saudi Arabia through implementing and enhancing the water use efficiency as an integral part of achieving the SDGs in Saudi Arabia.