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Part One: Water Resources of the World: Pressures, Challenges and Management Approach
During the latter half of this century, the pressure on natural water resources in many regions of the world has been increasing dramatically. Currently humans are extracting about half the 12,500 cubic kilometers that are readily available. Demand is now growing at twice the rate of population increase and accelerating. This can be attributed to the rapid growth in urban sprawl, the increased pace of industrialization, agriculture and irrigation development and pollution. In 1995 water availability was estimated to be 7,500 cubic meters per person per year, while as recently as 1970 it was 12,900 cubic meters.
Click for required readings of this session: Introduction and A, B, C, D of Chapter 1 of Comprehensive assessment of the freshwater resources of the world.
By the year 2025 water demand will be determined by four major driving forces; population, technology, trade and the environment. As the global population will have increased by 3 billion by this date it will be the predominant influence, especially in the semi-arid and arid developing countries where demographic growth will be greatest. Development aspirations of the burgeoning global population will drive the need for technologies for improving water-use efficiency, as water becomes a limiting factor in the process of increasing food production and industrialization and maintaining the environment. For example this technology will enable some countries to use scarce resources to produce high-value products which can be traded for food grown by more water endowed countries, thereby enabling them to move away from the policy of food self-sufficiency to one of food security. Waste water treatment technology to reduce agricultural and industrial pollution will also play a major role in shaping the future supply of freshwater as pollution saps the potential for growth by damaging human and environmental health.
Click for required readings of this session: Chapter 2 of Comprehensive assessment of the freshwater resources of the world.
III. Management Approach
To address these challenges a new approach has been conceived which has at its core the adoption of a comprehensive policy framework and the treatment of water as an economic good, combined with decentralized management and delivery structures, greater reliance on pricing, environmental protection and fuller participation by stakeholders. The adoption of the comprehensive framework facilitates the consideration of relationships between the ecosystem and socio-economic activities in river basins. Analysis should take account of social, environmental, and economic objectives; evaluate the status of water resources within each basin; assess the level and composition of projected demand; and take into consideration the views of all stakeholders. The advantages of such an approach are:
Part Two: New Thinking on Water Resources
I. The Hydrological Cycle
Rain and snowfall bring to earth freshwater which is harvested for numerous activities. This water runs on the ground, flows in the rivers and lakes and oceans, infiltrates the soil, then evaporates to create clouds which condense to form rain and snowfall again. These processes are interlinked in a complex, continuously evolving global system called the hydrological cycle. All socio-economic and environmental activities on this planet are entirely dependent on this system, which distributes freshwater independent of human will. The system sustains life but also imposes the threats of drought and flood. It is humankind's indispensable "partner-for-life", in a partnership in which humankind is not dominant. Human activities such as industry, agriculture, irrigation, rural and urban settlements are therefore naturally dependent sub-systems. These sub-systems have a heavy impact on the system, often with negative consequences on, the quantity and quality of available water, climate change, environment and biodiversity.
Source: Office of the Colorado Engineer
II. Self Organizing System
The hydrological cycle is the natural global system which distributes water around the planet independent of the will of humankind. Essentially it is a self organizing system. It is very difficult, costly and time consuming to predict the behavior of systems which are self organizing, and it is only worth the effort if the economic and financial benefits derived from the monitoring process are considered to be worth while. In the case of the hydrological cycle the market has already made its choice, witnessed by the incredible amount of money which is spent on hydrometeorological information networks for, civil and military aviation, management of multi-purpose dam reservoirs, the El Nino phenomenon, drought management and agricultural futures markets; and the huge amount of television prime time which is dedicated to weather reports.
The well endowed nations obviously have the better systems and benefit from them socially, economically and environmentally. It follows therefore that economies countries with lesser developed information infrastructures are more vulnerable to the natural disaster risks which this self organizing system regularly creates, which in extreme cases tends to neutralize development initiatives. At present there are countries which cannot afford water resource information systems and others, that use information as a currency of exchange for trading in power and status, which do not want them.
The challenge to the development community is to assist all countries to equip themselves for effective hydrometeorological risk management and to form information sharing partnerships to improve the global capability to try and predict hydrometeorological events for the benefit of national, regional and global markets.
III. Water as an Economic Good
What is the value of freshwater? In spite of the vital life-support service which water renders to the planet, historically water was seldom considered to have economic value. Even Plato mentions this fact in Euthydemus, "For it is the rare thing, Euthydemus, which is the precious one, and water is cheapest, even though, as Pindar said, it is the best". More relevant to modern economic theory perhaps are the words of Adam Smith in Wealth of Nations when he describes the difference between "value in use" and "value in exchange". "Nothing is more useful than water: but it will purchase scarce any thing; scarce anything can be had in exchange for it. A diamond, on the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exchange for it". Both were referring to the relative abundance of water resources which were available to supply the socio-economic demands of their times, a situation which caused water to be a non-tradeable commodity and therefore a free good.
The UN Water Resource Conference at Mar del Plata in 1977 attempted to alert the international community to the trend towards relative water resource scarcity, (in other words Adam Smith's reference to water was becoming invalid in some regions of the world). Although it did not have the desired impact, it was the beginning of an awareness process which culminated at the Water and Environment Conference in Dublin in 1992, and the Dublin Water Principle which stated that, " Water has an economic value in all its uses, and should be recognized as an economic good". Although still not well understood or well defined, the concept was already manifest in many regions of the world in the form of privatization of water supplies, the emergence of water markets, and the proliferation of bottled drinking water. This marked the end of the era of water as a free good.
Since 1992 water economists have made great contributions to the understanding of the value of water for many activities. However there is a long way to go and research and the awareness campaigns are continuing. The World Bank's response to Dublin was the publication in 1993 of a Water Resources Management policy. This policy treats water as an economic good.
Readings for this session (click and then select "open it" -- just to view the file, or "save it to disk". To open the file, you need the Microsoft Word 6.0):
To be able to decide on riparian rights, water markets and social and environmental responsibilities, it is necessary to accurately monitor the behavior of the hydrological cycle so that decision makers can appreciate the hydrological context of their economies from both the national and international perspectives. This is particularly important for those which share river basins and aquifers. It is important that decision makers understand that when the limits of water resources are being reached it is necessary to begin thinking in terms of "what can we do with what we have", rather than " what would we like to do". This is where the concept of the "economic value" of water becomes a key issue.
Planning authorities need to know when they are reaching the limits of water resource supply so that they can begin planning inter-basin water transfers, or implementing new financial and economic incentives to encourage industry to recycle water, and agriculture to use water more efficiently. To be able to make all these decisions, those responsible for economic and financial analysis must be provided with scientifically accurate hydrological information whenever it is required. Therefore hydrological services and water management agencies must have the technical means and institutional capacity to monitor and assess water resources quantitatively and qualitatively in function of this new demand for market information, upon which billions of dollars of decision making will rest. This is the challenge for the hydrologic and water resources management profession and the justification for developing the art of applied hydrology for water resources management, or put another way, hydrology with economics in mind, as per the Dublin Statement.
However management of water is a very complex operation requiring new approaches to information exchange between sectors for risk analysis. The objective of this information exchange would be to ensure that all socio-economic activities within a river basin can maximize their capacity to produce wealth without detriment to the environment and without reducing their capacity to attract investment and service debt.
The questions therefore are:
The first step is to create a non-threatening information exchange environment in which all interested parties can discuss the water allocation and risk management issues informally. An example of this is the World Bank/World Meteorological Organization (WMO) partnership for setting up the World Hydrological Cycle Observing System (WHYCOS). The aim is to:
With this system in place decision makers are then encouraged to communicate with each other to discuss water allocation and risk management informally on the basis of information about the behavior of the hydrological cycle, the limits to total demand, and the environmental demand to protect the natural resource capital base. These discussions will hopefully produce informal intersectoral partnerships which can evolve into formal partnerships for information exchange if the need for collaboration and institutional cooperation to reduce risk and create wealth is identified and mutually agreed. Decision aiding systems which employ river basin models and digital mapping for the visual simulation of development scenarios for policy makers will be indispensable tools for "bridging the communication gap" between sectors and their stakeholders.
V. Relationships between hydrological cycle, river basin, water demands and investment
Lecture Explanations of Relationships by G. Matthews
The relationships between water resources, the ecosystem, and socio-economic activities can be envisioned via the following diagrams. They represent surface water flow in a river basin in terms of Quantity against Time. Ground water can be treated in the same manner. The upper curve is the Total Water Resource Availability which is available for socio-economic sectors and the environment. Another way of looking at this curve is to consider it the boundary of a hydrological envelope within which we live.
Diagram A shows total water resource availability for a typical river basin. The environmental demand curve is shown following the upper total water resource curve. The amount of water below the environmental curve is the quantity which is available for the development of all socio-economic activities. In this case the socio-economic demand curve is shown climbing up towards the environmental demand curve which indicates a river basin which still has potential for further development and investment in wealth creation from the water resource perspective without having to be unduly concerned with allocation.
Diagram B shows a river basin which has developed all available water resources for satisfying socio-economic demand. Allocation now becomes the number one economic issue for sustainability. Note that in order to continue creating wealth and protecting investment it is important that water for socio-economic activities not be taken from the water supply for the environment. If it does it will deprive the natural resources of the water they need to maintain their production capacity. An extreme case would be when all the water is used for socio-economic activities which would result in the river basin becoming a desert. The impact on the economy and investors would be devastating. Under normal river flow conditions decision makers should have little problem in maintaining the socio-economic demand curve below the environmental demand. However when a river basin is developed to its maximum, there are two cases when monitoring for water allocation decision making becomes vital for the survival of the economy.
The first is pollution, which makes water unusable for irrigation and its treatment very expensive for industry and drinking water. Diagram C illustrates the effect of pollution on the socio-economic demand curve. This curve is obliged to descend because sufficient water must be left in the river to dilute the pollution in an attempt to minimize the damage to the environment and the aquatic life and to prevent overloading of the water treatment plants which supply industry and domestic drinking water. This diluting water would probably come from the irrigation allocation so as to protect the soil. This demonstrates how pollution reduces productivity in all sectors and threatens the health of the natural resource capital, and how important it is to have the monitoring capacity to detect pollution disasters at an early stage and before it begins to disrupt production and reduce investment and reimbursement potential and oblige the authorities to spend money on cleaning it up. Money which has been hard earned and probably needed for new investments.
The second case is drought. Its effect is illustrated by Diagram D. Again the first priority is to protect the environment and the natural resources capital so as not to exacerbate the desertification effect due to the lack of water. For this particular case a monitoring system with simulation capacity for forecasting, or predicting drought probability would be a very useful tool for decision makers.
Part Three: Policy Framework of the Water Resources Management
I. Four Guiding Principles of the Dublin Statement (1992)
The International Conference on Water and the Environment (ICWE) was held in Dublin, Ireland, in January 1992 was the most significant global conference on water since the United Nations Water Conference held in Mar del Plata, Argentina, in 1977. The Dublin Statement on Water and Sustainable Development is the most important document for water policy-making and implementation.
The four guiding principles of the Dublin Statement are (cited from the International conference on water and the environment: Development issues for the 21st century):
Since water sustains life, effective management of water resources demands a holistic approach, linking social and economic development with protection of natural ecosystems. Effective management links land and water uses across the whole of a catchment area or groundwater aquifer.
Principle #2 Water development and management should be based on a participatory approach, involving users, planners and policy-makers at all levels
The participatory approach involves raising awareness of the importance of water among policy-makers and the general public. It means that decisions are taken at the lowest appropriate level, with full public consultation and involvement of users in the planning and implementation of water projects.
Principle #3 Women play a central part in the provision, management and safeguarding of water
This pivotal role of women as providers and users of water and guardians of the living environment has seldom been reflected in institutional arrangements for the development and management of water resources. Acceptance and implementation of this principle requires positive policies to address women's specific needs and to equip and empower women to participate at all levels in water resources programs, including decision-making and implementation, in ways defined by them.
Principle #4 Water has an economic value in all its competing uses and should be recognized as an economic good
Within this principle, it is vital to recognize first the basic right of all human beings to have access to clean water and sanitation at an affordable price. Past failure to recognize the economic value of water has led to wasteful and environmentally damaging uses of the resource. Managing water as an economic good is an important way of achieving efficient and equitable use, and of encouraging conservation and protection of water resources.
Based on the four principles, a number of actions were identified which will involve multilateral and bilateral co-operation (Report of the Conference, 1992, Dublin).
Information base and know-how
Adequate and comparable information is essential for sound decisions. The Conference identified the need for every institution taking decisions in this field and for the public to have the best feasible access to:
These data need to be validated, kept up to date and to be accompanied with evaluations and assessments, in order to analyze the effects of decisions based upon them. Only in this way can the development and management of the water resources be made responsive to demands and be enabled to influence the way in which those demands develop.
Human resources development
To implement these principles, communities need to have adequate capacities. Those who establish the framework for water development and management at any level, whether international, national or local need to ensure that the means exist to build those capacities.
These means will vary from case to case. They usually include:
To promote the general education of the public about the proper use of water and its economic value, the factors which need to be taken into account and the methods by which decisions are taken require full public participation.
Institutional and legal arrangements
Management at the lowest appropriate level: Recognizing the need for a central mechanism capable of ensuring co-ordination of national social and economic interests, the role of governments needs to be reviewed to ensure that users, local institutions and the formal and informal private sectors can play a more direct part. A key aim must be to improve accountability to the public. The levels at which management decisions can be taken and problems solved will vary widely from country to country and case to case. In any given situation, however, water resources should be managed at the lowest appropriate levels. Integrated water resources development and management therefore should be delegated to those lowest appropriate levels which would ensure the representation of those concerned or affected and integration of sectoral demands. These may be existing bodies, institutions and mechanisms or special river basin authorities. Consistent with such institutional structures is a greater reliance on incentives, prices and markets and less reliance on traditional command and control approaches.
National level: Higher management levels and the national level will play a very important role in ensuring the availability of the information, coordination, policy development, planning, the legal framework, and the development of human resources, which are all needed for integrated water resources development and management, including sector integration. In many cases there will be a need to identify a national administrative unit for effective coordination, which should preferably not be a water user.
International level: In many cases, the integrated water resources development and management of transboundary water resources will raise the need for international cooperation and mechanisms at international or regional levels to facilitate inter-country agreement on the coordination of the management of such resources in an economically and environmentally sound manner. A coherent approach by all international organizations is also needed.
Law: The national legal framework for integrated water resources development and management decisions need to be clear and be consistent with the above principles. International law is needed to facilitate bilateral or regional agreements on transboundary integrated water resources development and management. In this context, an international seminar should be organized as soon as possible, to examine the legal aspects of integrated water resources development and management at international, national and local levels.
Planning: Water resources development and management should be planned in an integrated manner, taking into account long-term planning needs as well as shorter horizons, i.e. it should incorporate environmental, economic and social considerations based on the principle of sustainability; it should include the requirements of all users as well as those relating to the prevention and mitigation of water-related hazards; and it should be an integral part of the socio-economic development planning process. A prerequisite for sustainable management of water as a scarce and vulnerable resource is that its full costs should be acknowledged in all planning and development. Planning considerations should reflect benefits investment, environmental protection and operation costs, as well as the opportunity costs reflecting the most valuable alternative use of water. Actual charging need not necessarily burden all beneficiaries with these. Charging mechanisms should, however, reflect as far as possible both the true cost of water when used as an economic good and the ability of the communities to pay.
Demand-management: The role of water as an economic and life-sustaining
good should be reflected in demand management mechanisms, implemented through:
Investment: The setting of priorities afresh for private and
public investment strategies should take place taking into account:
Appropriate mechanisms must be found to correct the negative effects of structural adjustment in depriving the poor of their right of access to drinking water.
(Cited from the Report of the Conference of the International Conference on Water and the Environment. Dublin, 1992)
1. Elements of a Water Strategy
Although many current water-use patterns and pollution habits are propelling the world towards a series of local and regional water crises, mankind has not yet reached the point of no return. THere are many practical, cost-effective measures that can reduce the strain on water resources. They represent a series of critical investment opportunities that one cannot afford to ignore.
Seven elements of a water strategy were discussed in the UN water document:
Geoff Spencer at the World Bank listed the six key elements of River Basin Development and Management as:
The findings of this report dramatize the importance of putting into practice the concept of a holistic management of fresh water as a finite and vulnerable resource, and the integration of sectoral water plans and programs within the framework of national economic and social policy.
Through a series of meetings, particularly the Dublin water conference, a set of principles, later reflected in chapter 18 of Agenda 21, for water planning and management have emerged and are gaining wide acceptance.
The concept of water as an economic good needs to be implemented taking into account the provision of water for the satisfaction of basic needs.
Some important progress has been achieved in a number of countries in this regard. However, a much greater commitment to the implementation of these recommendations is needed world wide to achieve sustainability.
Governments should incorporate these important principles in their social, economic, and environmental planning.
(cited from the Comprehensive assessment of the freshwater resources of the world, p26-27)
Click for required readings of this session: D of Chapter 3 of Comprehensive assessment of the freshwater resources of the world.
Project implementation must be based on a clear methodology which enables decisions to be made which are relevant to the Bank’s and Client’s business processes. In this case it is the “project cycle” beginning with the creation of the Project Concept Document (PCD). To that end the following project implementation methodology, which includes the use of the Bank’s knowledge and information infrastructure, is suggested.
II. Project Implementation Methodology
1. Using the intranet create, electronically, a (focus) country home page.
2. Import the PCD macro.
3. Import an interactive environment map of the country and attach to the end of the PCD as an Annex.
4. Using the map define the hydrological context of that country by overlaying the river basins and aquifers. Identify the international riparians and ad their maps to that of the (focus) country.
5. Attach a second Annex entitled “Water Related Data and Information”. This annex will contain hydrologic, water resource assessment information, and socio-economic and environmental water demands of all the riparian countries. Sectors to be included could be rural communities, urban areas, rain fed agriculture, animal farming, irrigation and drainage, industry, the environment, hydropower, forestry, water sheds, and etc.
Click to get information of "Water in Other Sectors". (Note: When you get into the Water Resources Management page on the Intranet, click the "water links" in the right frame).
6. Add a third Annex entitled “Institutional Structure and Policy and Legal Frameworks”. This annex will encompass water law(s), riparian rights and water management institutions of the (focus) country and riparians.
7. Add a fourth Annex entitled “River Basin Planning”. This annex will provide the basis for allocating water to all sectors. It will contain information on the development aspirations of the country, with particular reference to its economic and financial policy and the environmental and social aspects of water resources management.
8. Determine socio-economic and environment mismatches between present economy and development aspirations from WRM perspective and analyze alternative policy and projects options in a river-basin context to address them. Then using river basin modeling (Harshadeep’s model) narrow down the options to select the best alternative and project(s).
9. After final selection by the client, begin creation of the PCD(s) for the selected project(s) not forgetting sustainability aspect of operation and maintenance.
10. Fill out PCD(s) using past, present and future information and knowledge requirements from Bank and Client Information and Knowledge Resources, and others.
11. Geo-reference and imbed past, present and proposed future project information into the interactive map and a simulation model. Share this electronic resource and simulation capacity with country either by CD ROM, laptop carried by task managers whilst on mission, extranet to resident mission, or internet.
12. Continue implementing the project cycle. Use the extranet to resident missions or internet to effect tele-missions and meetings and monitor procurement from Washington.
13. Archive the electronic record of the project for future projects and socio-economic and environmental analysis.
14. Refresh the Bank’s Information and Knowledge Resources with material from the completed project.
Click for required
this session: Geoff Spencer, River Basin Development and Management: Key
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