Implementation Principle 6: Economic Investments
Investments that ensure continuing or renewed water security and watershed services sustain local livelihoods, create opportunities and underpin local and national economy.
Quantify the direct benefits to stakeholders
Moral arguments (‘it’s the right thing to do’) and technocratic affirmation (‘we will squeeze out more crop per drop’) are worthy but usually ineffective in the face of competition for resources. All too often, people are aware of the deterioration of their water resources, but they do not or cannot change their behaviour or take action to halt it. Only when direct benefits can be clearly demonstrated is behaviour likely to change.
In some cases, the direct benefits are clear. But in others, especially in upstream-downstream situations, the benefits may seem to go to others. It is sometimes a challenge to clarify the ecosystem service benefits of a healthy watershed.
Conversely, water projects may create vulnerability and uncertainty about livelihoods. Empowered local communities should be given an opportunity to secure a fair share of the resources or the revenues from projects. Those displaced by water projects should be given fair compensation.
Stories from the field:
- Evaluating the economic importance of the Okavango Delta’s natural resources - A study on the economic values of uses of the Okavango Delta states that the $65 million tourist industry must find a way to trickle down some of its earnings to locals through joint venture projects. Environmental services such as groundwater recharge, water purification, and carbon sequestration were valued at up to $64 million.
- Analysing river flows and ensuring equitable allocations – Successful management of Tanzania’s Pangani Basin must integrate environmental, economic and social demands, trading their various costs and benefits against each other. An environmental flow study helps establish the values of various water uses and highlights the links between livelihoods, economic development and the ecological health of the basin.
Related WANI Toolkits:
PAY: Chapter 1 - Incentives for Water Security, Chapter 2 - Valuing and Managing Watershed Services, Chapter 3 - Designing a Payment Scheme, Chapter 4 - Roadmap towards Agreement
SHARE: Chapter 2 - Why Share? The Benefits (and Costs) of Transboundary Water Management
VALUE: Chapter 1 - Putting Ecosystems into Water Equations, Chapter 2 - Correcting the Balance Sheet, Chapter 3 - Valuing Ecosystems as Water Infrastructure, Chapter 4 - Using Ecosystem Values in Water Decisions, Chapter 5 - Moving from Case Studies to Standard Practice.