WEBVTT - Is Water Infrastructure the Next Target in the Iran War?

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. A month into the

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<v Speaker 1>Iran war, the costs are mounting, and the Trump administration

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<v Speaker 1>continues to send mixed messages about when and how the

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<v Speaker 1>war will end. Gas prices in the US climbed above

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<v Speaker 1>an average of four dollars a gallon on Monday for

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<v Speaker 1>the first time since August of twenty twenty two. Jet

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<v Speaker 1>fuel has searched, and in a post on truth Social

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<v Speaker 1>this morning, President Trump suggested countries facing shortages buy oil

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<v Speaker 1>from the United States or quote build up some delayed courage,

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<v Speaker 1>go to the strait and just take it. The post

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<v Speaker 1>comes amid reporting from The Wall Street Journal that the

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<v Speaker 1>President has told aids he's willing to end the war

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<v Speaker 1>even if the strait of her moves remains largely closed.

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<v Speaker 1>The US Defense Secretary Pete Hegseth said today that diplomatic

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<v Speaker 1>talks with Iran are ongoing.

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<v Speaker 2>We would much prefer to get a deal.

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<v Speaker 1>Rom was willing to relinquish material they have and ambitions

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<v Speaker 1>they have.

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<v Speaker 2>Open this great, that's the goal.

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<v Speaker 1>Hexath said he thought the talks were quote gaining strength,

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<v Speaker 1>but that the US would continue it strikes if a

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<v Speaker 1>deal isn't reached.

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<v Speaker 2>We don't want to have to do more militarily than

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<v Speaker 2>we have to. But I didn't mean it flippantly when

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<v Speaker 2>I said, in the meantime, we'll negotiate with bombs.

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<v Speaker 1>The flurry of headlines on Tuesday comes on the heels

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<v Speaker 1>of another threat the President made against Iran. On Monday.

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<v Speaker 1>He posted on truth social that if the Iranian regime

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<v Speaker 1>fails to reach a deal shortly, the United States would

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<v Speaker 1>obliterate all of Iran's electric generating plants, oil wells, carg Island,

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<v Speaker 1>where most of Iran's oil is processed for shipping, and

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<v Speaker 1>possibly all of the country's desalination plants.

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<v Speaker 2>It's an extraordinary threat in truth. Iran's reaction to that

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<v Speaker 2>is likely to cause more problems when it comes to

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<v Speaker 2>desalination plants.

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<v Speaker 1>Peter Martin covers defense, policy and intelligence for Bloomberg. He

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<v Speaker 1>says desalination infrastructure is critical to the countries of the Gulf.

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<v Speaker 2>Tens of millions of people across the region are dependent

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<v Speaker 2>on the desalinization process.

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<v Speaker 1>An American president threatening to destroy desalination plants is unprecedented,

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<v Speaker 1>and if it happened, it could be a violation of

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<v Speaker 1>international law. It could spark a humanitarian crisis.

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<v Speaker 2>I think it's fair to say that it's something that

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<v Speaker 2>no other president within living memory would have done. But

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<v Speaker 2>That's been true of a lot of Trump's actions so far.

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<v Speaker 2>You know, successive US administrations have talked about whether or

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<v Speaker 2>not military action against Iran could work and have decided

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<v Speaker 2>ultimately that it wouldn't the cost would be too high.

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<v Speaker 2>President Trump has made a different calculation, and so I

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<v Speaker 2>think it would be naive to suggest that he might

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<v Speaker 2>not also take surprising and controversial steps in this case too.

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<v Speaker 1>I'm Sarah Holder, and this is the Big Take from

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<v Speaker 1>Bloomberg News today. On the show, we look at the

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<v Speaker 1>vital yet vulnerable infrastructure that makes life possible in the

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<v Speaker 1>Middle East and what would happen if desalination plants become

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<v Speaker 1>targets in the war with Iran. The countries that ring

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<v Speaker 1>the western side of the Persian Gulf, Bahrain, Kuwait, Saudi Arabia, Qatar,

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<v Speaker 1>and the United Arab Emirates are among the most water

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<v Speaker 1>scarce countries in the world.

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<v Speaker 2>And as a result of that, countries across the region

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<v Speaker 2>are reliant on desalinization to obtain drinking water and other

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<v Speaker 2>water for commercial and industrial uses. To sort of put

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<v Speaker 2>it in context a little bit, around forty percent of

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<v Speaker 2>the water that is used by the UAE comes from desalination,

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<v Speaker 2>about seventy percent the Saudi Arabia and actually ninety percent

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<v Speaker 2>for Kuwait. So it's absolutely crucial to civilian and industrial life.

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<v Speaker 1>Across the Persian Gulf. What are the alternatives to desalination?

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<v Speaker 1>What other water sources are there?

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<v Speaker 2>There's very limited fresh water in the Gulf. There are

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<v Speaker 2>river sources, some countries hold underground reserves which have enough

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<v Speaker 2>water for a few days or a week, but really

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<v Speaker 2>there is no alternative in most of the golf countries.

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<v Speaker 1>So Peter, let's get a sense of the history of

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<v Speaker 1>this technology in the golf. What was it like there

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<v Speaker 1>before desalination and when did the first desalination plants come online?

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<v Speaker 2>Yeah, I mean the technique has been around for millennia.

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<v Speaker 2>It's just a basic basically, it's the process of removing

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<v Speaker 2>salt from seawater and making that water drinkable. There were

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<v Speaker 2>sort of two techniques which dominated for a long time.

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<v Speaker 2>One was thermal desalination, which I can remember being shown

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<v Speaker 2>as a kid in elementary school, which is where you

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<v Speaker 2>eat water steam evaporates and then you capture the steam.

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<v Speaker 2>And there's another process called reverse osmosis, which is now

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<v Speaker 2>the dominant technology and the one that's spread all across

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<v Speaker 2>the Middle East, which is where you use pressure to

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<v Speaker 2>push seawater through membrane and you remove the salt from it.

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<v Speaker 2>So basically, before the advent of this technology and its

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<v Speaker 2>widespread use, there's no way that golf countries could have

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<v Speaker 2>supported the kinds of populations that they have now. I

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<v Speaker 2>think all of the golf countries are incredibly dependent on

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<v Speaker 2>the technology, and without it, they wouldn't have the kind

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<v Speaker 2>of tourism service financial industries that you see today.

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<v Speaker 1>How reliant is desalination infrastructure on other kinds of infrastructure

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<v Speaker 1>like energy and oil infrastructure, which was also talked about

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<v Speaker 1>in Trump's truth social post as a potential target in

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<v Speaker 1>this war.

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<v Speaker 2>Yeah, so desalination plants have a kind of symbiotic relationship

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<v Speaker 2>with energy and power plants. The pressure that's required to

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<v Speaker 2>push water through those filtration membranes and to remove the

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<v Speaker 2>salt from the water is incredibly energy intensive, so they're

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<v Speaker 2>often built next to power plants. That makes them very expensive.

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<v Speaker 2>Some estimates I've heard put desalinated water at about twenty

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<v Speaker 2>five times more expensive than other sources around most of

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<v Speaker 2>the world, but in the Gulf, the region has a

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<v Speaker 2>huge advantage in that it's endowed with massive amounts of

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<v Speaker 2>oil and other hydrocarbons, bringing down some of those costs.

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<v Speaker 1>So, Peter, I mean you laid out how many people

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<v Speaker 1>across the Gulf States depend on desalination. But this problem

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<v Speaker 1>isn't limited to the Gulf, right. Other countries in the

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<v Speaker 1>Middle East also depend on this technology, including Israel, which

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<v Speaker 1>is an active party in this war. Israel gets about

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<v Speaker 1>seventy percent of its water from desalination plants. So how

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<v Speaker 1>vulnerable is all of this infrastructure in the Gulf in

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<v Speaker 1>Israel to being damaged in this war?

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<v Speaker 2>Yeah, I mean the infrastructure is vulnerable across the entire region.

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<v Speaker 2>Israel has excellent air defenses compared to many of its neighbors.

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<v Speaker 2>It also has alternative sources of water. There's a major

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<v Speaker 2>lake that it relies on, and it's worked for decades

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<v Speaker 2>really to reduce its vulnerability to water scarcity. So if

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<v Speaker 2>a desalination plant were to be taken offline in Israel,

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<v Speaker 2>it would be a problem, but not a catastrophe. In

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<v Speaker 2>the same way that it might be the say.

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<v Speaker 1>Kuwait, And I feel like this has all been building

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<v Speaker 1>to the question of Iran. Can you walk through how

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<v Speaker 1>dependent Iran is on desalination and on desalination infrastructure.

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<v Speaker 2>Iran is not particularly dependent on it. It has desalination

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<v Speaker 2>plants and it would be disruptive to take them offline.

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<v Speaker 2>The country has suffered from drought in recent months, but

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<v Speaker 2>now as we head to the springtime, there's access to

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<v Speaker 2>fresh water from rain, has multiple rivers, and so I

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<v Speaker 2>don't think that it's an existential threat to you rule.

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<v Speaker 2>Isn't i ran in the same way as it is

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<v Speaker 2>to it's Arab golf neighbors.

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<v Speaker 1>But if President Trump does follow through on his threat

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<v Speaker 1>to possibly destroy Iran's desalination infrastructure, it could trigger a

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<v Speaker 1>dangerous chain reaction, and it wouldn't be the first time

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<v Speaker 1>a desalination plant in the Gulf had been targeted in war.

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<v Speaker 1>After the break, we'll look at exactly what the human

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<v Speaker 1>and economic costs could be if it happened again. Why

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<v Speaker 1>are desalination plants attractive targets for military action? Why have

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<v Speaker 1>they become targets before?

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<v Speaker 2>In theoretical term, they're large fixed targets that are easy

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<v Speaker 2>to locate, They're difficult to replace quickly. They can put

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<v Speaker 2>tremendous stress on any government that's reliant on that technology

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<v Speaker 2>if you remove it, because your civilian population is then

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<v Speaker 2>put at risk. It has happened before. During the First

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<v Speaker 2>Gulf War, Iraq targeted Kuwates desalination plants, taking some of

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<v Speaker 2>them offline, but in truth, they have rarely been targeted.

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<v Speaker 2>The Geneva Convention makes it clear that it's illegal to

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<v Speaker 2>target them because they're necessary for civilians to survive. So,

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<v Speaker 2>you know, they're relatively easy, large targets that are simple

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<v Speaker 2>to hit. It's just that the legality of that is

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<v Speaker 2>very problematic.

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<v Speaker 1>Yeah, yeah, I mean you mentioned the Kuwait attack. What

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<v Speaker 1>does the fallout from that tell us about the stakes

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<v Speaker 1>of potential strikes on desalination plants in this war.

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<v Speaker 2>Yeah. Iraq targeted some of Kuwait's desalination plants in the

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<v Speaker 2>First Gulf War, taking some of them offline and reducing

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<v Speaker 2>the access of Quait's population to drinking water. Suppliers were

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<v Speaker 2>then brought in from Saudi Arabia and other neighboring countries,

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<v Speaker 2>and that the US also helped with some of that response,

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<v Speaker 2>But in truth, you know, it's difficult to maintain reserves

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<v Speaker 2>for large civilian populations for long periods of time.

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<v Speaker 1>And if a plant like this is attacked, how long

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<v Speaker 1>could it take to get back online?

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<v Speaker 2>Yeah? So, experts I've spoken to say that, you know,

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<v Speaker 2>minor damage could be repaired in months, perhaps weeks, but

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<v Speaker 2>the larger scale damage would require years to repair.

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<v Speaker 1>What happens if water begins to run out in these

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<v Speaker 1>countries see shortages? What are the humanitarian implications of that?

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<v Speaker 2>Yeah so, I mean the most immediate result would be

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<v Speaker 2>that households would begin to run short on water, and

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<v Speaker 2>that could happen within a matter of days. Typically governments,

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<v Speaker 2>you would expect them to start doing things like rationing

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<v Speaker 2>water use, restricting commercial use, perhaps distributing bottled water to populations.

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<v Speaker 2>And if it were to persist for a long time,

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<v Speaker 2>I think that probably evacuations would be considered.

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<v Speaker 1>And from an economic standpoint, which parts of these Golf states'

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<v Speaker 1>economies are most vulnerable? Again, if a plant like this

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<v Speaker 1>were to be taken out or even damaged, if you.

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<v Speaker 2>Think of somewhere like Dubai with a massive urban population,

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<v Speaker 2>an economy which runs on services finance, tourism, the life

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<v Speaker 2>of the population there would be very difficult to sustain.

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<v Speaker 2>All of the industry surrounding it would be difficult to sustain. Essentially,

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<v Speaker 2>these economies would come grinding to a whole without the

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<v Speaker 2>ability to obtain the water that they need.

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<v Speaker 1>Given the extremely high stakes of keeping these desalination plants running,

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<v Speaker 1>I'm wondering what golf countries are doing to protect their

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<v Speaker 1>water supplies and their manufacturing facilities right now, and how

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<v Speaker 1>well those efforts have been working.

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<v Speaker 2>Experts that I've spoken to say that there's not really

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<v Speaker 2>very much that they can do to protect the facilities.

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<v Speaker 2>They're large, they're exposed, they're quite technically fragile, there's a

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<v Speaker 2>lot of sensitive technology inside, and you know, the countries

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<v Speaker 2>themselves are protected by air defenses. Most of the Gulf

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<v Speaker 2>States have a pretty good record of shooting down incoming

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<v Speaker 2>Iranian missiles and drunes, but it's not a perfect record.

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<v Speaker 2>Lots is still getting through and there's not really much

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<v Speaker 2>that can be done to harden them in the short

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<v Speaker 2>term other than just trying to shoot down missiles and drugs.

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<v Speaker 1>Striking desalination plans would be a violation of the Geneva convention,

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<v Speaker 1>it's a war crime. What would the consequences be if

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<v Speaker 1>a country or a government like the US did target

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<v Speaker 1>desalination plans in this war?

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<v Speaker 2>Think truth is that we don't know. We'd be entering

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<v Speaker 2>uncharted territory from the outset. This war has been, you know,

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<v Speaker 2>questioned by some of the US's closest allies when it

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<v Speaker 2>comes to whether or not American actions have been legal.

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<v Speaker 2>US strikes on desalination plants would certainly invite that kind

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<v Speaker 2>of questioning, as would Iranian retaliation. But you know, I

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<v Speaker 2>think a lot of people feel like we've got to

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<v Speaker 2>a point here where we're kind of an outrage fatigue.

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<v Speaker 2>I'm not sure what would happen in practical terms other

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<v Speaker 2>than a huge international outcry.

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<v Speaker 1>Are there risks that even accidentally or as a symptom

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<v Speaker 1>of this broader conflict in the Middle East, that desalination

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<v Speaker 1>plants might be damaged, whether through strikes from around the

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<v Speaker 1>US or other regional players, And what are the implications

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<v Speaker 1>of that.

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<v Speaker 2>Yeah, there's absolutely that if energy facilities were to be targeted,

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<v Speaker 2>there's the potential that that damage could take desalination plants

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<v Speaker 2>offline because they're so energy intensive and There's also, of course,

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<v Speaker 2>the possibility of collateral damage. Trust on both sides in

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<v Speaker 2>this war is running pretty low at the moment, and

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<v Speaker 2>so it would be quite difficult for either side to

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<v Speaker 2>convince the other that that kind of damage had been accidental,

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<v Speaker 2>and that raises the possibility of escalation quite considerably.

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<v Speaker 1>Well, We've already seen one example of a desalination plant

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<v Speaker 1>being damaged in this conflict. The Iranian government has said

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<v Speaker 1>that a desalination plant was damaged on Kesum Island in

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<v Speaker 1>the Strait of Hermos, disrupting the water supply to thirty villages.

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<v Speaker 1>How did Iran and the US respond to that incident

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<v Speaker 1>and how much does this raise the risk of future

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<v Speaker 1>attacks on desalination plants in this war?

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<v Speaker 2>I think a lot depends on whether President Trump goes

0:14:57.520 --> 0:15:02.200
<v Speaker 2>through with his most recent threats. Iran said that its

0:15:02.200 --> 0:15:06.040
<v Speaker 2>facility had been hit in early March. The US responded

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<v Speaker 2>by saying that the facility was not deliberately targeted, and

0:15:10.720 --> 0:15:14.960
<v Speaker 2>exactly what happens kind of remains in dispute. But Iran

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<v Speaker 2>did retaliate by hitting a facility in the Gulf state

0:15:19.320 --> 0:15:24.360
<v Speaker 2>of Bahrain and saying subsequently that any further attacks on

0:15:24.400 --> 0:15:28.800
<v Speaker 2>Iranian energy infrastructure could be met by attacks on golf

0:15:28.920 --> 0:15:32.960
<v Speaker 2>desalination facilities. So I think it's something that both sides

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<v Speaker 2>have kind of put in play, but so far on

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<v Speaker 2>the ground there's been a reasonable degree of restraint between

0:15:39.960 --> 0:15:45.000
<v Speaker 2>both sides, precisely, I think because the humanitarian consequences would

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<v Speaker 2>be so grave and the reputational cost to either side

0:15:49.120 --> 0:15:52.920
<v Speaker 2>for actually carrying out activities which is so crucial to

0:15:52.960 --> 0:15:54.880
<v Speaker 2>civilian life, would be pretty high.

0:15:59.760 --> 0:16:02.880
<v Speaker 1>This is The Big Take from Bloomberg News. I'm Sarah Holder.

0:16:03.680 --> 0:16:06.240
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<v Speaker 1>Thanks for listening. We'll be back tomorrow.