Distr.RESTRICTED

LC/R.139921 June 1994

ENGLISHORIGINAL: SPANISH

ECLACEconomic Commission for Latin America and theCaribbean

PUBLIC POLICY FOR SUSTAINABLE DEVELOPMENT:INTEGRATED RIVER BASIN MANAGEMENT*

Axel C. Dourojeanni

* This study was prepared by Axel Dourojeanni of the NaturalResources and Energy Division for the Second Latin AmericanCongress on Watershed management to be held in Mérida,Venezuela, from 6 to 11 November 1994. V.97-26058 (E)

This document has not been edited.

INDEX

Preface......................................................1

Introduction.................................................5

1. Late reactions in the area of environmental and resourcesmanagement.................................................62. .......External interests and stimuli in relation to theenvironmental issue.......................................113. From an agenda of their own to a specific work programme

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Part I Conceptual framework and evolution of watershed management17

1. . . .The utilisation of river basins for sustainable humandevelopment...............................................17

A. .....Conflicts between growth, equity and environmentalsustainability...........................................18B. ....Comparison of river basin development concepts andregional development.....................................24C. .........Watershed or river basin management objectives

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2. ..........Evolution of integrated river basin management32

A. ..Evolution of the subject of river basin management inLatin America............................................35B. Evolution of the issue of water resources development inLatin America............................................41C. Evolution of the issue of river basin management in LatinAmerica..................................................43D. .....Evolution of water administration in Latin America

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Part II Technical dimension of watershed management........53

1. . .Scope of technical actions in the context of integratedriver basin development...................................532. . Scope of technical actions aimed at the multiple use ofwater resources...........................................563. . . .Scope of technical actions in the sphere of watershedmanagement................................................634. ......Scope of technical actions in the context of wateradministration............................................74

Part III Managerial aspects of watershed management........75

1. ............Functions of river basin management agencies75

A. Motivations and justification for the establishment of river basin management agencies....................76

B. Functions and responsibilities of river basin authorities79

C. .......................Roles of river basin authorities83

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2. .............Basis for establishing river basin agencies92

A. .........................................Political basis93

B. ............................................Legal basis103

C. ........................................Financial basis116

D. ...........................................Social basis123

E. .....................Organizational and functional basis131

3. ...............................Management support systems139

A. ...................................Information systems 139

B. .........................................Decision models143

C. .......................................Planning systems146

4. .....................How is a river basin agency scaled?149

A. Factors affecting the formation of river basin agencies149

B. ..The formation and structuring of a river basin agency152

C. Procedures to be followed for scaling or establishing ariver basin agency......................................153

Part IV Summary and recommendations for river basin management in Latin America and the Caribbean.....................157

1. . . .Subjects relating to sustainable development and riverbasins...................................................158

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2. ...........The characteristics of water and river basins159

3. . . .The river basin as a territorial option for directing environmental management processes.....................161

4. Definitions and aspects of river basin management processes163

5. ..........The evolution of river basin management systems164

6. ..........Recommendations for avoiding failures in water and river basin management processes...................166

7. Recommendations for improving the formulation of integratedwater

and river basin management policies....................168

8. Recommendations for improving the proposals for theestablishment

of river basin agencies................................171

9. Future tasks.........................................173

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Preface

This document has been prepared by Axel Dourojeanni at ECLAC as acontribution to the Second Latin American Congress on Watershedmanagement to be held in Mérida, Venezuela, from 6 to11 November 1994. The Congress is sponsored by the Food andAgriculture Organization of the United Nations (FAO), theRegional Office for Latin America and the Caribbean, the LatinAmerican Watershed management Network and the Venezuelan Ministryof the Environment and Renewable Natural Resources.

Public policies aimed at coordinating measures topromote human development using the area of a river basin as abasis for management have diverged in their approaches andevolution from one country to the next in the Latin American andCaribbean region. None the less, the subject has regainedcurrency since 1990, when the countries of the region seriouslyset about tackling the issue of achieving sustainable developmentby reconciling economic growth, equity and environmentalsustainability. The river basin and water in particular play avery important role in permitting the participation andintegration of the actors involved in development and in theattainment of the goals of environmental sustainability. Suchparticipation makes for a convergence of regional and locallevels and, in relation to specific cases, also highlights thedilemmas to be resolved in the privatization of naturalresources, the role of the State and the public sector, and therole of the local and regional levels in the management ofnatural resources such as water, wildlife, native woodlands andnatural ecosystems which are normally considered the heritage ofa country. Within this context, this paper seeks to provide someconsiderations for formulating coherent public policies aimed atachieving sustainable development goals based on river basinswith public participation.

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The subject of watershed or river basin management and thepublic policies formulated in that regard is a complex one. Itis one of the basic prerequisites for achieving sustainabledevelopment, which is an exceptionally complicated task bydefinition, touching on technical, environmental, political,legal, economic, financial, organizational and social questions,to name but a few of the considerations involved. In addition, itis very closely linked with decentralization and regionalizationplans and especially with the new roles assigned to local orcommunity-level actors in connection with achieving sustainabledevelopment goals.

Watershed management is the prerequisite for the countries’success in achieving satisfactory environmental management.Fashionable issues such as how the role of the private and publicsectors should be determined in the management of water and otherresources considered part of the national heritage, the economicexploitation of natural assets, the democratic participation ofusers in decision-making processes relating to development andthe environment, the need to create forums for regional and localcoordination, the need to tackle the root causes of ruralpoverty, the involvement of women, and other key questionsrelated to biodiversity, rational land management and protectionof the population against extreme phenomena are all subjectsdealt with in this paper to various degrees.

The main motivation for bringing together in a single studythe findings drawn from the accumulated experience of over almost30 years of research in watershed management sprang from therenewed interest in the subject displayed by both national andregional authorities in connection with the organization of riverbasin agencies. Various legislative bills are under considerationand others have already been adopted which support theestablishment of such agencies. The reasons for introducing suchlegislation are essentially to do with the increasing competitionfor water and the ever more catastrophic impact of naturalphenomena on human life and the economy. Moreover, theenvironmental issue ultimately demands specific and practical

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responses which can only be provided through satisfactorymanagement systems.

In an age in which great attention is being given tosubjects associated with openness to the outside world, such asthe globalization of markets, open regionalism, integration inthe world market, foreign investment and free-trade agreements,customs reforms and export promotion, to mention just a few ofthe subjects falling under the heading of “openness”, it isextremely important for each country to strengthen its systemsfor managing its natural resources in order to be able to achieveclarity in its dealings and avoid action being taken withdamaging consequences, either through deficient management orignorance of the country’s resources.

Openness to the outside world will be positive only to thedegree that each country knows precisely what effects will beproduced on the surrounding region, on society and on the currentand future economy. Knowing how to manage or control undesiredfactors in relation to river basins provides a means of acquiringthe essentials for sound negotiations. Natural resourcesmanagement based on river basins requires and also facilitatesthe local participation necessary for creating the space to dealwith social questions. This also makes it possible to achievefurther goals, namely the goals of strengthening genuinedemocracy based on a thorough knowledge of the matters to bedecided, reinforcing the power to implement decisions in thecollective interest and, ultimately, achieving equity. Only thosewho know their environment will know just how far it can beinterfered with before the damage leads to an irreversiblebreakdown. It is imperative, however, that emotive environmentaldebate be set aside in favour of action adopting a scientific,economic and social approach, which must be duly safeguarded inorganizations and serious studies.

This paper brings together material previously prepared andpresented by Axel Dourojeanni in connection with earlier eventsrelated to river basin management and also contains previouslyunpublished materials. The main documents by Axel Dourojeanni

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used as a basis for this present paper were the following:“Gestión para el desarrollo de cuencas de alta montaña en la zonaAndina” (Management for the development of high-mountain riverbasins in the Andean region),1 “Bases conceptuales para laformulación de programas de manejo de cuencas hidrográficas”(Conceptual basis for the formulation of watershed managementprogrammes),2 “La cuenca: dimensión geoecológica y unidad para eldesarrollo integral, balances y propuestas” (The river basin:geoecological dimension and unit for integrated development,current status and proposals),3 “Las cuencas hidrográficas: unaopción territorial para dirigir acciones tendientes a lasustentabilidad ambiental” (River basins: a territorialalternative for directing initiatives aimed at environmentalsustainability),4 “Aspectos gerenciales en la gestión de cuencas”(Management issues in watershed management),5 “Sistemas degestión de aguas: el manejo de las cuencas” (Water managementsystems: watershed management),6 “Propuesta para el ordenamientode los sistemas de gestión del agua en los países de AméricaLatina y el Caribe” (Proposal for the planning of water

1ECLAC, Book No. 17, containing a series of papers by Axel Dourojeanni,one by John Tipton and the results of five case studies by consultants fromColombia, Peru, Ecuador, Venezuela and Bolivia. It was published in Englishunder the code LC/G.1533 in September 1988.

2ECLAC, Doc. LC/R.1143/Rev.1, published in the Annals of the SecondSymposium of the Chilean National Committee for the International HydrologicalProgramme (CONAPHI), University of Concepción, Chile, 21-23 October 1992, witha second summarized edition published for the First National Watershedmanagement Seminar of Peru, 5-9 July, 1993.

3Published in “Enfoques integrales y desarrollo rural” by the AndeanTechnology Coordination Commission (CCTA), August 1991, Lima, Peru.

4Document prepared for the Third National Convention of Irrigators andWater Users organized by the Chilean Confederation of Canal Users, October1993, Los Angeles, Chile.

5Document prepared for the Inter-American Seminar-Workshop on IntegratedWatershed management organized by the Inter-American Programme of theOrganization of American States and Inter-American Center for the IntegralDevelopment of Water and Land Resources (OAS-CIDIAT) and the Water Departmentof the Chilean Ministry of Public Works, Valparaíso, August 1993.

6Annals of the Seminar on National Water Policy, Legislation and RiverBasin Administration, in Derecho en la Región, University of Talca, Faculty ofLegal and Social Sciences, Year 1, No. 1, September 1992, Talca, Chile.

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management systems in the countries of Latin America and theCaribbean),7 “Políticas de gestión integral de aguas y políticaseconómicas” (Integrated water management policies and economicpolicies),8 “Definición y clasificación de las actividades degestión de cuencas” (Definition and classification of watershedmanagement activities),9 “La evolución de la gestión de cuencasen América Latina y el Caribe” (Development of watershedmanagement in Latin America and the Caribbean),10 “Reflexionessobre la gestión del agua y las cuencas en América Latina y elCaribe” (Reflections on water management and river basins inLatin America and the Caribbean),11 “¿Qué hacer después de Rio?Lo que no hicimos antes de Estocolmo” (What should be done afterRio? What we did not do before Stockholm).12

In addition to these documents used as a basis for draftingthe present paper, new topics were incorporated with theassistance of Terence Lee with regard to the historicaldevelopment of water resources administration, of HelmuthFriedrich with regard to river basin legislation and thecomparison between the development of river basins and that ofregions, of Roberto Andrade with regard to the basis for theorganization and financing of river basin agencies, and of Andrei

7ECLAC, Doc. LC/G.1733, 1992, published in the publication records of theGraduate School of Business Administration (ESAN), Year 1, No. 1, March 1992,Lima, Peru. In Chile a preliminary version was published in the annals of theSeminar on Renewable and Natural Resources Management in the Itata riverbasin, University of Concepción and Government of Ñuble, November 1991,Chillan, Chile.

8ECLAC, Doc. LC/R.1207, 1992, published in the annals of the SecondSymposium of CONAPHI, University of Concepción, October 1992, Concepción,Chile.

9Document presented at the Third Symposium of CONAPHI on IntegratedManagement at river basin level, held in November 1993, Valdivia, Chile.

10Document published in Debate Agrario: Análisis y Perspectivas, No 18, PeruvianSocial Studies Centre (CEPES), Lima, April 1994.

11Article to be published in CEPAL Review in August 1994.12Article published in Eloísa Tréllez Solís (Editor), De Estocolmo a Rio de

Janeiro. Un balance hecho por ambientalistas, Executive Secretariat of the Andrés BelloConvention, Konrad Adenauer Foundation, October 1993, Santafé de Bogotá, D.C., Colombia.

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Jouravlev, who assisted in the overall structuring of the paperin terms of both content and form.

The aim of this paper is to provide basic material forfuture research. A large proportion of its contents will need tobe fleshed out with case studies. However, in the author’sopinion, it has the merit of ordering material which is usuallydispersed and therefore difficult to obtain by persons working inthe field of watershed management, while at the same timepresenting a previously unpublished outline of the variousapproaches to the subject of river basins and indicating gaps ininformation and research. It is intended merely as a modest firstattempt, but nonetheless a very vital one, to order the materialand tackle the subject in a systematic fashion.

This paper is complementary in its practical application tothe book “Procedimientos de Gestión para el DesarrolloSustenable” by the same author, which was published by ILPES asDoc. 89/05/Rev.1 and is also available in Italy in a publicationby the Italian Latin American Institute (1989 version) and inPanama in a publication by the Nature Foundation and theTechnological University of Panama (1994 version).

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Introduction13

Most of the countries in the region have no system for managingnatural resources or, at least, no properly functioning systems.This applies particularly to water resources management inrelation to river basins, the management of native woodlands,wildlife management and soil conservation. The public and privateservices which exist to further the conservation, preservation,reclamation and protection of resources such as wildlife, plantlife and the land in general are failing by a wide margin to keeppace with the needs of the users.

The inputs provided towards improving resource managementsystems have mainly been conceived in relation to investmentprojects and users in the business sector. Very little has beendone towards strengthening stable systems for the management ofnatural resources, through, say, the establishment of soil-conservation districts or river basin corporations. This is afactor which is now preventing or hampering the launching oflarge-scale programmes, such as reforestation programmesinvolving local community participation, because of the lack ofany organizational basis.

Legislation and regulations on the utilization of resourceshave been drafted with reference to formal, duly registered typesof users with advanced levels of education and an entrepreneurialapproach. Here, the incentives, penalties and compliancerequirements, for example, of environmental impact studies areeffective. This applies in developed countries and also in Latin

13Based on the article “¿Qué hacer después de Rio? Lo que no hicimosantes de Estocolmo” (What should be done after Rio? What we did not do beforeStockholm), published in Eloísa Tréllez Solís (Editor), “De Estocolmo a Rio deJaneiro. Un balance hecho por ambientalistas”, Executive Secretariat of the Andrés BelloConvention, Konrad Adenauer Foundation, October 1993, Santafé de Bogotá, D.C.,Colombia.

America and the Caribbean, but only where there exist enterprisessimilar to those of the North.

This approach is woefully narrow, however, in the way itoverlooks the vast majority of users of the environment who, inLatin America and the Caribbean, are geographically and legallymarginalized from formal systems both in towns and in thecountryside. This group of persons are in a precarious situation,being trespassers on lands to which they have no title andmostly illiterate. In other cases, while they might indeed be thelegitimate owners of land, they lack the means to manage theirenvironment the way they did in the past. These groups of usershave received assistance only through occasional investmentprojects.

The raising of the environmental banner rather than startingby improving the management of natural resources by the usersthemselves—as was happening in the developed countries longbefore the environmental issue became an issue—was simply a meansof making shortcuts without, unfortunately, undertaking practicalaction.

Consequently, we hold that the experts and officialsresponsible for the environment and natural resources of thecountries in the region should retrace their steps and placethemselves pragmatically in their real situation as it is now.There is no point attempting to achieve the pace attained by developed countriesin tackling environmental problems without beginning by strengthening thefoundations of a natural resources management system. It is necessary toadopt measures AIMED AT ensuring coordinated environmentalmanagement rather than attempting to achieve everything startingfrom a single point of departure.

It should also be borne in mind that the magnitude of thetasks involved requires the adoption of strategies for large-scale action. In other words, resources need to be invested inorganizing the private sector with regard to resource management,in training it, drafting manuals and promoting coordinated

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studies relating to geographical units such as river basins,micro-regions and municipalities.

It will probably be necessary to establish two complementarysystems for environmental and resources management, one directedat the formal sector of environmental users, which may to someextent follow patterns successfully applied in developedcountries, and the other for the informal environmental sector.In the case of the latter, it is necessary to think in terms ofparticipatory systems with wide coverage, beginning with basiccourses in colleges and continuing through to analysis of theworking patterns of such users with a view to formulating—througha collaborative exercise between technical experts and users—options for managing the environment.

1. Late reactions in the area of environmental and resourcesmanagement

The countries of the region have been late in forming their ownideas regarding environmental and resources management.

Generally speaking, they have lacked policies of their ownfor managing natural resources and the environment. Declarationshave been signed in all the countries regarding natural resourcesand the environment and are enshrined both in their Constitutionsand in numerous laws, but the bulk of their articles andprovisions are yet to be put into practice.

It is well known and has been repeatedly stated that thenatural resources of the region are important for its economicgrowth and that they form the basis of industrial production andconstitute the heritage to be passed onto future generations.Despite this, however, they are not assigned top priority. Thisimplies that whereas, on the one hand, natural resources and theenvironment are declared in the Constitution and innumerable lawsto be important in general, on the other, funding has not beenallocated for their management, nor has the private sectorcommitted itself to the tasks involved.

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The contents of official declarations are largely a responseto international rather than national currents. To exaggeratesomewhat, it could perhaps be stated that 80 per cent of themeetings held on environmental or natural resources management atthe regional level have been at least partly funded by externalsponsorship rather than the participants themselves. Althoughthere are economic explanations for this situation, it alsoreflects the low priority given to the subject when budgetaryfunds are actually assigned by both the public and the privatesector.

All these assertions have two implications: one concerningthe way in which the Governments of the region act and react, andthe other the way in which the Governments of developed countriesproceed in the field of environmental management.

As far as the countries of the region are concerned, thefollowing may be stated:

Stocktaking, evaluation and analysis of natural resourcesbegan recently, on a national scale, in almost all the countriesof the region sometime around the early 1960s. This was the timewhen the natural-resources evaluation offices came into being,entities which operate actively on the basis of external fundingand promptings, with their own budget fed by these externalcontributions. Their activities have declined as external fundinghas declined. The information available today on the naturalresources in the countries of the region derives largely fromthis period.

Stocktaking and evaluation continued in the 1970s, alongsidenationalization, planning and the drafting of copious legislationregarding the management of soils, woodlands, water and otherresources. For the most part, however, the results of thisresearch were never applied, partly because no account was takenof the role of private users as the key factor to be consideredin resources management and partly because the full extent of theweakness of the State system was not recognized.

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Towards the end of 1970s the momentum acquired in the realmsof planning and legislation ran out at the same time as Stategigantism, without having yielded corporate systems in theprivate sector that would operate in favour of the management orconservation of natural resources in certain defined areas,except in specific irrigation districts. Resources management forproductive and conservationist purposes continued without beingcarried out on the necessary scale by either the private or theState sector.

Discussion continued regarding how to incorporateenvironmental issues in school and university curricula. In manyparts of the region, as in rural schools, the teaching providedis still not in harmony with the environment in which thestudents live. At the university level, there are no more than apaltry two or three postgraduate courses on natural resourcesmanagement. The training colleges have still not succeeded inestablishing any system for building technical expertise in thisfield among users with meagre technical know-how. This, then, isanother area in which there exists a vacuum.

In the 1970s, as in previous decades, the emphasis onprojects continued: major projects for the development of waterresources proliferated, as did integrated rural developmentprogrammes and hundreds of initiatives to support ruralcommunities, cooperatives and other low-income groups. Regrettably,none of these initiatives was directed towards strengthening a public-privatesystem for managing natural resources or the environment. Development wascompartmentalized and no formulas were found for securing theeconomic and financial commitment of the users themselves.

In the mid-1970s, somewhat belatedly after Stockholm, theenvironment suddenly took centre stage in the region, this timemore clearly as a result of external influence. Little by littleenvironmentalist movements came into being, some competing withthe others, and they contributed towards fragmenting the meagreforces dedicated to ensuring enforcement of the recently enactedlaws on the management, conservation or protection of soils,woodlands, wildlife and other resources. In the desire to

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introduce more “comprehensive” laws, a brake was put on theapplication of laws directed towards resources management.

The individuals who acquired the new title of“environmentalist”, some with no more than an ad hoc knowledge ofthe subject matter, not only succeeded in securing fundingpreviously directed towards natural resources management, butalso carried on heated debates concerning the resourcesmanagement programmes subsequently implemented. Many did notrealize, however, that the environment could be managed as awhole only if the individual parts composing it were also managedand that, in addition, under our conditions, any pro-environmental action should be linked as far as possible to someproductive goal.

This is not meant to imply that the ideas of theenvironmentalists who were initiated into the subject afterStockholm were negative from the environmental point of view, butthat their ideas were accompanied by an ignorance of resourcesmanagement issues. Furthermore, the same non-governmentalorganizations (NGOs) felt they were defending their countries’interests became vehicles, willy-nilly, for the ideas enteringthe region from abroad, some of them appropriate to theirterritories and others not, or at least not in this initialphase. More than 10 years elapsed after Stockholm before the countries beganto evolve ideas of their own on environmental matters and more than 18 yearsuntil “Our Own Agenda” was formulated.14

The environmental issue held attractions for many, apartfrom being intrinsically necessary and unobjectionable: resourceswere available from abroad to deal with the issue, thus providingan employment opportunity for many in the face of privatizationtowards the end of the 1970s and during the 1980s. Politicians,

14Javier Pérez de Cuellar, in his address to the Colombian Congress on 23August 1990, stated with regard to the presentation of the report Our OwnAgenda that “development and the environment ... are finally receiving theattention they deserve not only from scientists and activists, but alsopolitical leaders and public opinion in general”.

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whether from the right or the left, also found the environmentalissue to be of use in justifying their positions.

Few of them realized, however, that in the countries of theregion, although it was possible to SPEAK about the environment,it was not possible to manage it without setting about doing soin well-defined stages. In fact, at the time the environmentalbanner was raised, there was still no organizational basis orbudgetary funding to manage even the national reserves or parksor for the waste-water treatment of a major city.

The table top was bought without the legs to support it, and, what is worse,the small amount of money available to make the legs was used to hold meetingsand to TALK about how the table top should look. It was not possible to design itand the only thing agreed was how it should NOT be. We complained abouteverything that was NOT to our liking, but failed to propose any workablemethods for resolving problems taking account of each country’s actual situation.

The environment began to find a place within the ideas ofGovernments, ideas that were taken up liberally by various NGOs,whose funds came largely from abroad at a time of major economiccrisis in the countries of Latin America and the Caribbean. Thiswas accompanied by the beginnings of policies to reduce the Stateapparatus and promote privatization which did not gather any realmomentum until the early 1990s.

In the 1980s it proved impossible to maintain a satisfactoryState system on a reduced scale but still capable of assistingthe private sector in natural resources management. Neither wasit possible to establish how environmental protection tasks mightbe transferred to the private sector, especially that vast“informal” sector of the rural and urban poor, who were usuallymarginalized from any effective legal status. Privatizationpreceded the preparation and transfer of obligations to theprivate sector in respect of the management of natural resources.

Some advances have been made in demanding that the“environmental impact” of projects be measured, an achievementlargely due to the influence of international banks and certainlyfar more limited in scale than the hundreds of initiatives

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undertaken with regard to the environment and not covered by “asingle project”.

Environmental impact studies are only undertaken, if at all,as part of formally executed, self-contained projects. The impactof small initiatives which are “hidden” but large in scale arenot measured in this way.

For instance, no one in today’s world could imagineapproving an investment project to build a city such as MexicoCity or São Paulo that would pass an environmental test. This,however, is what is happening here today. At the present timehundreds of activities are being carried out (cutting down andburning-off forests, the use of chemicals in agriculture, theemission of industrial wastes in water courses) which have acombined impact that is greater and more difficult to monitorthan that of a single specific project.

Consequently, in many cases, where there is a majorinvestment project there is much greater environmental concernand more environmental managers than where there are no projects.Many zones which were formerly disregarded suddenly become“important” only when there are plans, say, to build ahydroelectric plant. Before those plans, the inhabitants of someof these places were totally ignored. For example, soil erosionbecomes a serious issue if the sediments silt up a reservoir.Unless the river basin has a dam, it will probably not be ofconcern to anyone that this erosion affects the inhabitants inthe higher reaches of the basin.

In the 1980s the State’s meagre forces and small pool oftrained personnel devoted to guiding the management of naturalresources, such as soil, woodlands, wildlife and waters, weredismantled in order to be regrouped as committees and, in somecases, institutes and ministries of the environment. These newministries and committees are seldom furnished with sufficientresources to discharge their tasks, even when they make a realeffort and sometimes succeed in making a genuine contribution,albeit on a small scale.

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In brief, the environmental banner is being raised in theregion at the cost of reducing the already scanty efforts beingmade in the sphere of natural resources management, a situationexacerbated by the economic crisis of the 1980s.

Latin America bought a “holistic” model from countries whichhad spent 70 or more years managing their natural resources atthe sectoral level, as in the case of the United States ofAmerica, which had soil-conservation, forestry and majorwatershed management services, some of them in operation sincebefore 1900. These advances provided that country with users’organizations, tried and tested regulations and work manuals,training programmes in universities and hundreds of researchprojects. This is the kind of basis necessary for a comprehensiveapproach to environmental management. In fact, the EnvironmentalProtection Agency (EPA) was established in North America back in1969 when, in Latin America, we were still trying to launch somekind of soil-conservation programme.

The 1980s in the region was the decade of reporting on theenvironment, establishing environmental committees and organizingenvironmentalist bodies, and of the drafting of environmentallegislation and proliferation of NGOs dedicated to protectingeverything from ornamental plants and iguanas to the Antarcticand the ozone layer.

Little by little, however, many of the people seriouslyinvolved with the issue began to realize that neither reportingnor having an environmental office were sufficient in themselves(the situation was something akin to having a chapel in an“unholy” place in order to calm the spirit, while people carriedon doing exactly the same things as before). It is hoped thatthis background will be of use in designing and applyingstrategies more in tune with the realities of the situation inLatin America and the Caribbean in the realm of environmentalmanagement.

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In conclusion, the 1980s was not a decade for the executionof large-scale environmental programmes, not even as regardsaspects of the management of natural resources. The decadewitnessed, moreover, the undoing of the meagre advances made andan exponential increase in the use of previously unexploitednatural resources, such as the native woodlands.

At the same time, however, it was a decade of vigilance and of the refiningof ideas and concepts and the assimilation of environmental issues. It was thedecade of the greatest consciousness-raising about the environment in history.

It was also a decade in which, in some instances, genuinesolutions were found to problems or, at least, applied them, suchas, for example, the first steps taken towards decontaminatingvarious rivers, air pollution control in urban centres, theprotection of certain ecosystems and of wildlife, and movementswhich put the brake on various projects with a potential negativeimpact. By the end of the 1980s an enormous number of draftlegislation had been formulated or passed to protect theenvironment which, while still needing to be tailored to theconditions of each country, nonetheless represented a significantstep forward.

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2. External interests and stimuli in relation to theenvironmental issue

The various developed countries which mobilized and donated fundsfor evaluating the natural resources of the countries of theregion and then for introducing the cause of the environment wereprimarily acting in their own interests. This attitude certainlyhad a double effect which, in the long term, proved beneficialfor both donors and recipients. At least, it can be stated thatit was favourable for our countries to the extent that it forceddiscussion of the subject, but unfavourable in that we did notset our own agenda right at the outset.

In principle, sponsorship was channelled towards initiatingthe evaluation of the natural resources of the countries of theregion, setting up offices for that purpose and establishingteams to carry out the work involved. Although they mostlyfollowed “imported” patterns of classification for lack of anysystems of our own, these evaluations contributed in the 1970s toyielding the only comprehensive statistical data available onnatural resources, data which are still being used even now.

A major contribution from abroad was that of the fellowshipprogrammes in different areas of natural resources management,which enabled hundreds of Latin American students to studyabroad, especially from 1965 to 1975. This sponsorship came fromoutside the region but also from various countries in the region,such as Venezuela, which allocated their own budgetary funds forsuch fellowships.

Remote sensing and progress in the design of computerprogrammes for “reading” satellite images meant that by the endof 1970 it was beginning to be less necessary to subsidizeresource-evaluation activities in the region on the part ofdeveloping countries. From this time onwards resource evaluationin the traditional sense began to decline without a concomitant,sufficient upgrading in our countries of remote-sensing andterrestrial measurement capable of using the images available.

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The reduction in the funds available for strengtheningnatural resources management is also apparent in internationalorganizations such as OAS and the United Nations, where the teamsand projects devoted to promoting natural resources managementbegan to be scaled back from 1980 onwards at the same time asteams devoted to the environment were being established. Thislimited the capacity for proposing management measures forindividual resources such as water, soil and forests, which areessential for the attainment of larger goals such as preservingbiodiversity or saving the oceans.

The major gap in sponsorship from abroad, however, is thepaucity of credits and donations for formulating and augmentingassistance programmes to improve the management capacities of theusers themselves, a consideration which is still more relevant inthe context of privatization. This gap is particularly seriouswhen it is necessary to work with users of the environment who,because they lack both education and legal expedients, require agreater supply of services and continuity of support. A programmeto organize the population, for example, in watershed managementrequires at least 10 years of development and the regularpresence of promoters.

The incorporation of so-called “environmental impactevaluations” in investment projects, while essential in all newventures, will not change any activities affecting theenvironment that are already under way, such as the selling andburning of forests or the indiscriminate hunting of endangeredspecies. There is a large gap in recommendations on environmentalmanagement that short-term projects cannot fill.

One of the activities that need to be upgraded, for example,is the management of river basin water resources. If efforts to“incorporate the environmental dimension”, at present fragmented, areconcentrated on at least improving river basin water quality, it might be possibleto control or eliminate almost 50 per cent of environmental problems. In otherwords, giving priority to one or two specific initiativesfacilitates the organization of users and makes for better

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channelling of the meagre budgetary funds available to thevarious State agencies and NGOs and better allocation of foreignfunding also, towards the achievement of specific goals.

This will be possible only to the extent that managementsystems are created and brought into operation which involve theparticipation of both private-sector and State actors. Thelegislation already in effect could then be applied on thenecessary scale. Without adequate management systems and theparticipation of the users themselves, the current policiescannot be put into effect.

In addition to the international treaties, recent factorsaffecting the situation have been the potential barriers on theimport of products which affect the environment either throughthe depletion of resources or because of the production processesused or the content of the products. This undoubtedly forces theregion’s exporting countries to manage their resources withgreater care with regard to their extraction and production,although it may also serve as a pretext for establishingprotective barriers.

In all these cases, external funding must be directedtowards improving the country’s capacity to manage its naturalresources better. Even where it is a matter of improving exports,the various producers need to be properly organized and trainedto manage their environment. External stimuli should provideincentives but cannot act as a substitute for decision-making.

3. From an agenda of their own to a specific workprogramme

The 1990s will need to be a decade of the management of naturalresources and the environment. It must be a decade of preparingthe State and the private sector for achieving effectiveenvironmental management. For this to happen, it is necessary totake account of the situation of each country and each region.Privatization and regionalization are excellent foundations for

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involving both formal and informal users of the environment inthis task. The State must enhance its promotional, assistance andmonitoring role where necessary and private entities mustorganize themselves in order to tackle their common problems, asin the case of a corporation needing to manage its multiple wateruse.

The goals set must be clear and even “modest”, but at thesame time broad in scope if it is genuinely desired to buildsomething solid. For example, a large-scale programme to reclaimthe cultivation terraces in Peru and Bolivia could prove far lesscostly than a project to irrigate arid zones but much moreeffective ... and complicated to implement unless a managementsystem for the reclamation work is prepared first on a nationalscale.

To return to the problem of how to improve the management ofeach resource and each region—where the foundations can be laidfor management involving the participation of the users—andsetting up projects and programmes in accordance with theavailable resources, what is suggested is that the legs of thetable should be built first before attempting to attach the tabletop.

If a country in the region was able, say, to demonstratethat it possessed the organizational ability and capacity toinvest a thousand million dollars in reclaiming 500,000 hectaresof terraces and in managing its watersheds, this would mean thatthe foundations were already in place for natural resourcesmanagement, whereas if they could not demonstrate such acapacity, investment would only be made in isolated projects,such as the construction of a hydroelectric plant or anirrigation project.

If the latter is the case, then environmental managementwill remain no more than wishful thinking in Latin America andthe Caribbean. It may be pursued and obviously contribute towardsalleviating worldwide environmental conflicts, with opinionsbeing expressed on the ozone layer, global warming and the

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preservation of biodiversity, while our rivers continue to turninto sewers and our cities into shanty towns.

The message is that the needs are enormous, but what can andmust be done in order to resolve a large proportion of thepressing problems at an initial stage is no great mystery. If, aswe have already mentioned, we were to undertake to manage onesingle resource such as water, then 50 per cent of ourenvironmental problems would already be resolved. It seems hardlypossible that after 20 years of formulating superb waterutilization plans virtually none of the countries yet has a realriver basin corporation or agency to manage and, above all,monitor water quality.

As a final thought on this subject, it is suggested thatdiscussion take place in each country regarding the followingquestions before any particular activity is proposed:

What State and private organizations does the country haveto manage its natural resources: river basin authorities,conservation districts, forestry districts, irrigation districts,or others? How does the State cover the territory in order tofurther or monitor the application of legislation onenvironmental or resources management?

What part does the private sector play in the management ofnatural resources? What differences exist between the formaluser sector (such as mining, oil, forestry or agriculturalenterprises), the traditional sector (such as members of farmingcommunities) and the informal sector (such as squatters on landin marginal areas) as regards their environmental managementprocesses?

To what extent has the environmental issue eclipsed ordisplaced the necessity of improving natural resources managementin the country? How many posts have been assigned to deal withenvironmental matters in the State and how many to supportresources management? What relative budget do they have at theirdisposal?

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How much has been assigned to tackling environmentalproblems through investment projects and how much to establishingongoing support services for that purpose such as, for instance,a soil, forestry or wildlife management service?

How much installed capacity is available in the country toevaluate the stock of natural resources by means of modernsystems such as satellite imaging and geographical informationsystems? What special methods does the country have at itsdisposal to classify and evaluate its natural resources, such assystems for classifying the land-use in high-mountain regions?

What environmental observation and monitoring networks existin the country? How is water and air quality assessed andquantified? What environmental information registers are there inplace?

What training programmes are available in the country in thefield of natural resources management at the school, universityand postgraduate levels? What courses are given each year onresources management? What system is used to disseminate suchinstruction among users? What kind of training-school networkoperates in marginal rural and urban areas?

What strategies have been developed to tackle the managementof natural resources in the hands of poor rural sectors,squatters and other “informal” users of the environment? Whatideas have been put forward for reaching these localities and forencouraging the participation of such persons? What projects orprogrammes are being implemented at the microregional ormunicipal levels in order to accomplish these tasks?

How does the State intend to set about regulating the use ofnatural resources which are located on private land devoted toexploiting only part of the resources present on it (for example,protection of wildlife on land for which a mineral or petroleumexploitation concession has been granted)? What type of Stateorganization is required in order to proceed with a private

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sector that is highly sophisticated and possesses alarge investment capacity?

What kind of improvements are being made in the capacitywhich exists at the municipal level to manage natural resources?Are there functions assigned to support natural resourcesmanagement in the municipalities? Are resources, manuals or otheraids available for accomplishing these tasks? What personnel willbe in charge of these tasks in the municipalities? Are anyenvironmental management training programmes provided at themunicipal level?

These and other questions will need to be answered as the1990s begin if we are at all serious in our intention to improvethe grave situation that exists at present in the area ofenvironmental management. As mentioned above, it is our view thatafter Rio we need to go back to what we should have been doingsince before Stockholm (in order to do what had already been doneby the Northern countries much earlier): we need to start byorganizing ourselves to manage resources in both the public andthe private sectors. Simple but effective tasks need to becarried out on a large scale, while forecasts will also have tobe made so that we can avoid making the same mistakes as the mostadvanced countries.

We also need greater certainty about our capacities. Forexample, we do not need, in Latin America, to apply the universalsoil-loss equation to establish the precise extent of soilerosion. We know that the loss is haemorrhagic in degree and thatit has to be arrested. This requires organization and involvementin order to act swiftly, cover large areas and help a broadspectrum of users. There is no need at present for years ofresearch and preliminary study in order to take rapid action insuch cases. There are hundreds of pilot areas, pilot projects andpilot courses whose results cannot even be applied for want of aproper management system.

The basic technology needed to monitor most of the region’senvironmental problems is effective without being so very

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sophisticated. Waste waters can be treated in stabilizationponds, infant mortality can be reduced through better hygiene,soil erosion can be halted by means of simple reforestationmeasures and agricultural production in mountain areas can beimproved by reclaiming and reforesting terraces. All theseactivities call for special solutions and also for the confidenceof credit institutions, confidence which we alone can inspirethrough the efficiency and honesty of our actions.

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Part I

Conceptual framework and evolution of watershed management

1. The utilisation of river basins for sustainable humandevelopment

The river basin is a territory delimited by nature itself,15

essentially by the boarders of the drainage areas of the surfacewaters which converge on a single course. The river basin, itsnatural resources and its inhabitants possess physical,biological, economic, social and cultural features which lendthem characteristics that are peculiar to each.

Physically, it represents a natural source for the catchmentand collection of surface water, and it therefore has anessentially volumetric and hydrological character. At the sametime, the river basin, and in particular the water captured byit, represents a means of human survival but also a threat whenextreme natural phenomena occur, such as droughts or floods, orwhen the water is polluted.

15Guillermo Cano and Joaquin Lopez state, in a paper entitled “Las cuencashídricas como unidades óptimas para la planificación y administración de los recursos hídricos:participación de los usuarios en tales actividades” (River basins as optimum units forwater resources planning and management: user participation in suchactivities), prepared in 1976 for the fiftieth anniversary celebrationsmarking the establishment of the River Basin Confederations in Spain, held inZaragoza, that “God has laid down the lines of separation of the waters as thenatural limits of river basins. Man, for his political and administrativeneeds, has drawn other lines which generally intercross and do not coincidewith the natural lines”.

In upland areas and mountain ranges river basins formnatural communication and trade routes, whether along the riversor along the line of summits separating them. There aremechanisms of close interaction between their inhabitants whichlend them particular socio-economic features.

In major basins with high water discharge rates and wide,relatively flat valleys, the axis of the river also becomes anarea of interlinkage among its inhabitants, particularly throughthe use of the river channel for navigation, transport andcommunications.

The territory of river basins fosters connections betweentheir inhabitants, whether or not they are grouped together indistricts for political and administrative reasons, owing totheir common dependence on a shared water system, on roads andaccess ways, and on the fact that they have to contend withcommon dangers. As a result of this interdependence, where thereare no systems for reconciling interests between the differentactors who depend on the same river basin and water, conflictswill arise between them.

This is certainly a pronounced feature of inhabitedwatersheds located in high mountain ranges, but it also occurs inwide river basins where the inhabitants depend on a common watersystem.16

River basins show up the negative impact of man’s actions onhis environment, especially those resulting in water pollution.This is clearly stated in the principles underlying theestablishment of river basin agencies in France, which maintainthat “the aquatic medium is an entity which harbours and supportsan entire animal and plant world, its waters and banks forming a

16No distinction is made in the Spanish language between “watershed” and“river basin”. Both terms are translated as “cuenca hidrográfica”, althoughattempts are made to distinguish between them by using expressions such as“cuenca fluvial” and “hoya hidrográfica” to denote “river basin”, and “cuenca de altamontaña” or “cuenca de captación” to denote “watershed”.

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special biological edifice. Man’s thoughtless interference withjust one of these elements disturbs this fragile balance andcauses a general impoverishment of the natural environment”.These principles accordingly assert that harmonious management ofwater resources calls for:

The acknowledgement, first and foremost, that a hydrologicalor hydrogeological basin constitutes a unit;

The recognition that consideration for and preservation ofthis unit are essential requirements for optimally meetingthe water demand of different users;

The recognition of the need to define specific andappropriate objectives for each area or territory and tocarry out the necessary structural works and activities forthe attainment of such objectives;

The acceptance that all the users have a legitimate right towater and that consequently each of them is subject tosimilar limitations regarding his or her own use.

The river basin is also a natural unit which serves as aterritory for coordinating management processes aimed atsustainable development.

A. Conflicts between growth, equity and environmentalsustainability

Sustainable development is a function of economic growth,environmental sustainability and equity. By definition, theprocesses involved in integrated watershed management must at thevery least make it possible to achieve the goals of utilizing thewatershed resources (economic growth) and managing the resourceswith a view to their preservation, conservation or protection(environmental sustainability). Equity is attained to the degreethat the management systems are participatory and democratic.

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Because it is a function of three objectives which have nocommon indicators or conversion system to give them a commondenominator, sustainable development is impossible to quantify.

These assertions can be illustrated by means of a triangle(see figure 1) which is a modified version of a similar triangleformulated by Peter Nijkamp,17 in which each side of the trianglerepresents an objective, the arrows along the sides of thetriangle represent the direction of each of these objectives andthe central area within the triangle represents the area in whichthese three objectives can feasibly be reconciled.

This “feasible zone” is equivalent to the equilibrium zonefor sustainable development. The triangle originally presented byNijkamp has been supplemented at the base by a formularepresenting the area or space within which such sustainable

development is sought. If it were possible to formulate anequation to express what is represented in the triangle, itwould be as follows:

Nijkamp’s triangle glosses over the incompatibilities whichcurrently exist between the three objectives, in relation totheir expression using a common denominator of measurement andevaluation. They are presented in a single plane, whereas, asmentioned above, this is not yet feasible. There are not yet anyequivalences or adjustment systems allowing the differentindicators to be integrated in a single plane. In theory, theonly plane which could in the long term serve as aninterconnecting plane is that of economics. This will only beachieved when, through this discipline, an evaluation can be made

17Peter Nijkamp, “Regional sustainable development and natural resourceuse”, Proceedings of the World Bank Annual Conference on Development Economics 1990, 26 and27 April 1990, Washington, D.C.

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of a number of natural resources which have not yet been takeninto consideration.

In the short term, the three above-mentioned objectives arein conflict with one another, a situation which can berepresented by the triangle in figure 1. In view of theimpossibility of linking the three objectives in a single planeuntil such time as appropriate indicators are identified, a moreaccurate representation is to draw the sides of the triangles indifferent planes (see figure 2). Thus, the economic, social andenvironmental dimensions are represented in separate planes.

It should also be remembered that interchange betweeneconomic growth, equity and environmental sustainability is notconfined to the area in which the triangle is formed but alsooccurs between areas, for example, between countries or betweenregions within the same country. This interchange between areasof, say technology (economic growth) through natural resources(environmental growth) makes it possible to compensate forinternal deficiencies within some areas and thus achieve thedesired objectives in a balanced manner.Figure 1. Graphic representation of the conflicting objectives

of economic growth,equity and sustainability

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Source: Adapted from Peter Nijkamp, “Regional sustainable development andnatural resource use”, Proceedings of the World Bank Annual Conference on DevelopmentEconomics 1990 , 26 and 27 April 1990, Washington , D. C.

In the process of interchange between areas, substantialdistortions may be introduced in the achievement of anequilibrium between economic growth, equity and environmentalsustainability. This happens when the transactions between areasare inequitable and one area has to supply an enormous quantityof natural resources in exchange for some form of moderntechnology.

The situations outlined in figures 1, 2 and 3 give a fairlyclear picture of the factors and situations involved incoordinating economic growth, equity and environmentalsustainability with a view to striking the balance required forsustainable development. However, they do not by any meansprovide practical answers as to how to achieve this coordinationin a particular region or territory.

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Figure 2. Graphic representation of the different planes ofanalysis of economic growth,

equity and environmental sustainability

Source: Adapted from Peter Nijkamp, “Regional sustainable development and naturalresource use”, Proceedings of the World Bank Annual Conference on Development Economics 1990, 26and 27 April 1990, Washington, D.C.

In order to resolve the practical problem of coordination,it is necessary to design management processes allowing man—thecentral actor—to take decisions, notwithstanding the present lackof conceptual clarity or theoretical basis, in order to:

Achieve economic growth, equity and environmentalsustainability in areas of watershed management as a meansof attaining sustainable development based on adequateknowledge and the possibility of performing transactionsamong the actors;

Determine what points of interchange (trade-offs) need toexist between these three objectives in a given river basin

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and between river basins, and what actors are involved inthe interchange decisions;

Facilitate the understanding by the actors involved of theforms of viable interchange among the three objectives andthe levels of such interchange, both in economic terms andin environmental and social terms;

Determine at what point the sustainable development balanceis achieved such as to meet the development requirements ofthe region’s actors through the generation and acceptance ofindicators of their collective and individual objectives.

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Figure 3. Conceptual and operational framework for inputs tosustainable development with equity

(The “Magic Cube”)

Source: Axel Dourojeanni, ECLAC, 1990-91

These observations are made in order to stress thatsustainable development is a function of all three objectives andcannot be achieved by giving priority to one at the expense ofthe other two.

Management by the actors must simultaneously promoteeconomic growth, equity and environmental sustainability through,for example, industrial processing, the provision of social

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services and the conservation of natural resources. These threeobjectives conflict with one another, especially in the shortterm, and work against one another. The conflicts arise because,in order to achieve an optimum situation overall, each has tosacrifice its partial optimum and this process requiresnegotiation. Lack of knowledge about the environment and the lackof common indicators for evaluating the three objectives has anadverse effect on such negotiation.

The balance sought between the three objectives is notusually achieved within a region that is closed off to theoutside world. On the contrary, the usual situation is forinterchange to take place between regions with different areas ofbalance.

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It is often the case in today’s world that lessindustrialized countries with abundant natural resources export“environmental sustainability” at low cost to industrializedcountries (through the export of natural resources) and importmanufactured products and technology. This would not be anegative factor if the countries importing technology were to useit in order to improve their understanding and management oftheir natural resources and ecosystems.

In fact, many countries with natural resources neitherimport nor use modern technologies to any great extent inmanaging their natural resources despite having the capacity todo so. In such cases, the low level of technology in rural areasand the use of land for social purposes, whether to have thecities subsidized by the countryside or whether to ensure thatland ownership is relinquished for exclusively social purposes,have undermined the process of modernizing natural resourcesmanagement in various countries of the region through theapplication of technology.

This has negative consequences for the environment, i.e. theexportation of natural resources on a vast scale without anyappreciation of their true potential or proper managementcombined with ignorance and low-level technology in theextraction of resources.

The determination of equity depends essentially on agreements amongactors and does not therefore take place automatically but on the basis oftransactions.

The quality of transactions will depend on the appreciationof the value of the elements, resources and products of an area,the comparative advantages of regions in relation to otherregions and the value of the elements and natural resourcesaffected. This balance, moreover, is transitory in that idealmodels of sustainable development will vary constantly as afunction of technological advances, the discovery of newresources and the changing aspirations of the actors, to mentionbut a few of the variables involved.

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As can be inferred from the foregoing, management processesaimed at sustainable development are essentially a blend of artand science, since there are still no indicators capable of“measuring” the social, environmental and economic dimensionswithin a system of interchangeable values, nor are those valuesequal for the various actors involved in the process.

Integrated watershed management is aimed at promoting sustainabledevelopment from the point at which it is aimed, through such management, toreconcile the utilization of the natural resources of the watershed (economicgrowth, industrial processing) with their management for the purpose ofpreventing conflict and environmental problems (environmental sustainability),while equity is achieved through decision-making processes involving thedifferent actors.

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B. Comparison of river basin development concepts and regionaldevelopment

(i) Approaches

The objectives of river basin development and the development ofregions (more widely known as “regional development”) areequivalent. The basic aim is the same: sustainable humandevelopment within a defined territory. There is, however, abasic difference of approach:

The river basin development approach is first of all todetermine the potential use of the natural resources, usingknown technology (supply), with a view to establishingeconomic growth and equity goals;

The development approach based on regions is first todetermine the economic growth needs (demand) and only thento establish environmental sustainability and equity goals.

Both approaches should be complementary and lead to the sameultimate objective human development.

Management aimed at human development in the context ofriver basins involves, in the first instance, gauging thepotential and needs for natural resources management in anenvironmentally sustainable form, water being the resource which isconsidered the fundamental axis for coordinating initiativesaimed at economic growth and equity. The margin for action isdetermined by the natural limits of the river basin. This is anapproach based on the premise that human development will besustainable only to the extent that it proceeds in harmony withthe environment. In other words, it is an approach based ondetermining the potential of natural resources in accordance withthe available knowledge, technology and organizational means,with a view to then establishing social and economic goalsaccording to that potential.

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Management aimed at human development in regions is anapproach based principally on socio-economic factors, whereby, incontradistinction to the first approach, economic growth isconsidered the decisive factor for human development. In regionaldevelopment plans, the environmental dimension is incorporated asa secondary consideration to the main socio-economic or sometimespurely economic objective. In this approach, economic growthgoals (production, industrial processing, exports, job creation,etc.) are established and an effort is then made to adapt the useof the land to achieve those goals.

This adaptation is often forced if the regional developmentplan has failed to take account of the potential and limitationsof the environment which it seeks to modify. Its task is to planthe organization and coordinated construction of the existing “macro-structures” and those still to be constructed within the humanenvironment (not primarily limited to one aspect), therebyfacilitating such “economic growth”. The initiatives carried outare not generally contained within the natural Managementaimed at human development in regions is an approach basedprincipally on socio-economic factors, whereby, in contradistinction tothe first approach, economic growth is considered the decisivefactor for human development. In regional development plans, theenvironmental dimension is incorporated as a secondaryconsideration to the main socio-economic or sometimes purelyeconomic objective. In this approach, economic growth goals(production, industrial processing, exports, job creation, etc.)are established and an effort is then made to adapt the use ofthe land to achieve those goals.

This adaptation is often forced if the regional developmentplan has failed to take account of the potential and limitationsof the environment which it seeks to modify. Its task is to planthe organization and coordinated construction of the existing “macro-structures” and those still to be constructed within the humanenvironment (not primarily limited to one aspect), therebyfacilitating such “economic growth”. The initiatives carried outare not generally contained within the natural limits but withinthe pre-established frameworks defined by economic and political

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expediency, such as the limits of communes, provinces,departments, states or regions.

(ii) Similarities and differences

How is the task accomplished?

In order to be able to undertake watershed or regionaldevelopment initiatives, it is necessary to have in place amanagement entity or a “coordinating and administrative forum”.The establishment and operation of such an entity requiressimilar bases for both types of development:

Political/legal basis (e.g. the expression of political willand legal agreements supporting it);

Economic/financial bases (e.g. economic sustainability andarrangements for funding the entity or coordinating forum);

Social bases (e.g. identification of the actors involved inthe proposed development process); and

Organizational bases (e.g. integration and empowerment ofthe actors in decision-making processes).

What factors are considered?

The two approaches differ in terms of the type of factorsconsidered and the scale on which they are analysed. Whereas thewatershed development manager will concentrate primarily on the“natural structures”, the regional development manager willdirect his attention more to analysis of the “socio-economicstructures”. The two approaches should, however, produce the sameresults if, in the final analysis there is a proper conjunctionof social goals (equity), economic goals (economic growth) andenvironmental goals (environmental sustainability), regardless ofthe basis on which the analysis is made. Likewise, similarmethodologies are employed in regional planning and watershedplanning.

(iii) Limits of management

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While river basin limits are static because they are defined byphysico-geographical features evidenced by the lines ofseparation between waters, the limits of a region may vary witheach change of government and are consequently dynamic. In fact,they are governed by political and administrative concepts andeven by the existence of communication and trade routes. Ingeneral, the current trend in a number of plans for demarcatingregional boundaries is to attempt to bring the watershed limitsinto line with the regional limits, especially in countries withhigh mountain ranges. The problems presented by coordinationbetween regions sharing a single watershed are well known,particularly if the limit between two regions is formed by ariver.

Greater decentralization in decision-making processes hasalso yielded another type of limit in watershed management whichneeds to be considered: the limit of municipalities or communes.In Latin America and the Caribbean we are currently witnessing anincreasing process of decentralization of political power,whereby greater importance and responsibility is being given tomunicipal administrations. The actors involved in planning willhave to participate to a far greater extent in decision-making.In this regard, the municipalities could take on the role of“basic units”—performing functions in terms of local administrationand political authority and serving as a discussion forum for theactors—both for the purposes of local and regional developmentand of integrated watershed management.

The involvement of the municipalities in watershedmanagement is crucial. The progress made in this direction,however, has been very meagre (in contrast to Europe, where thelocal authorities play an important role in water management; seepage 150), and there are very few municipalities which includewater and watershed management among their responsibilities,except in the Alto Andinas communities of Peru, Bolivia andEcuador. The concept of “municipal watershed” is also unknown inthe region. In Colombia some experience has been gathered in thissphere (Chicamocha river basin, see page 149) which could be ofvalue. One of the urgent tasks to be accomplished is to draft

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manuals for training municipal employees in this field, inparticular in:

Management of “municipal river basins”, i.e. river basinsused for supplying water to communities,

Control of water and sediment discharge constituting athreat to communities;

Urban drainage systems, otherwise known as urban hydrology; Planning of land use, taking account of natural phenomena

and floodable terraces; and Waste-water treatment.

C. Watershed or river basin management objectives

(i) Definition of terms used in river basin management

The coordinated actions undertaken by man in order to exert aparticular effect on a natural system formed by a river basin,and the dynamics of that system, have a variety of connotations.In general, such coordination of actions is classified by thisauthor as management actions based on watersheds or simply watershedmanagement. These management activities have different aims andconsequently different appellations. The best-known aims are asfollows:

Watershed and development (integrated development ofwatersheds);

Watershed management (organization of watersheds); Water resources development (administration of water); Watershed protection (reclamation of watersheds).

This list may be supplemented by adding modifiers such as“integrated”, “sustainable”, “strategic” or any other term theauthor thinks necessary. This variety of terms and permutationsthereof has brought with it a vast array of interpretations whichdiffer among the experts.

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As a result of this lack of conceptual consensus regardingthe Spanish terminology relating to watershed management, therehave arisen problems among institutions, defects in the draftingof legislation, difficulties in the planning of courses andacademic curricula and, most recently, errors in the presentationof proposals for establishing river basin and water agencies,problems which are as serious as ever and should therefore beavoided.

This variation of concepts on a single theme is largely dueto the fact that the terminology used in Spanish is saturatedwith anglicisms. For example, the terms “water resourcesdevelopment”, “watershed management” and “river basindevelopment” have been freely translated as “desarrollo derecursos hídricos” (the term “recursos hídricos” did not evenappear in the dictionary of the Academia de la Lengua Española when itwas already in use in Latin America), “manejo de cuencas” and“desarrollo de cuencas”. “River basin” and “watershed” are simplytranslated as “cuenca”, despite the fact that it is notequivalent to the English terms. “Management” is translated as“manejo”, which is neither the most accurate translation nor theonly meaning of the term, since it also corresponds to“administración”, “gestión” and “ordenamiento”.

It should be added that the actions entailed by each ofthese approaches differ according to the location in which theyare applied. The sense of the terms also changes according to theexpert, agency or university programme using it. Lastly, it should benoted that there is not yet any consensus nor any definition established by anofficial document regarding concepts relating to watershed management actionsand thus putting an end to the debate.

For these reasons, it is felt necessary to contributetowards achieving such consensus, which is precisely the aim ofthis paper. To this end, each of the terms making up theterminology used in referring to the execution of coordinatedaction in river basins is first analysed. A classification ofthese terms is then presented and, lastly, a brief analysis is

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given of the organizations necessary for coordinating river basinactivities.

Each of the terms used to refer to the performance ofcoordinated action in river basins has given rise to a wide rangeof definitions and related terminology. These terms areconstructed on the basis of the following elements:

The generic action: develop, organize, authorize, direct,administer, manage, preserve, protect, reclaim, utilize,conserve. These terms may subsume several of the othersaccording to the interpretation of each author, or accordingto convention or usage. For example, for some the term“manage” may encompass protection, conservation andreclamation. For others, “conserve” may include management,reclamation, protection, preservation and utilization. Theterm “development” is the broadest and vaguest since itcovers all these actions.

The subject or subjects of generic action. The geographical,hydrological, administrative or ecological territory orspace: the river basin, watershed, slope, river, valley,district, province or region. The natural resource orresources involved: water, soil, plant life, wildlife,minerals.

The specific aims pursued through the generic action upon theterritory or resources: to capture and supply water, preventsoil erosion, restore water-quality levels, achieve acertain yield in forestry production, and so forth, andspecific actions required in order to achieve those aims: to build adam, train farmers, provide credit facilities.

The ultimate objective or objectives pursued through the combinedeffect of the actions, and the scope of the actions in terms of thesectors, disciplines and geographical area covered: integrateddevelopment, sustainable development, enhancement of qualityof life.

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The target public: society as a whole, users of drinking water,small farmholders with modest means, the inhabitants of avillage or town and, generally speaking, all the actorstargeted by coordinated actions on the river basin fordevelopment purposes.

Owing to the current discrepancies in the meaning andinterpretation of these terms, it is recommended that each authordefine the terms which he uses to refer to watershed managementprocesses. In order to facilitate this work, a classification ofthese terms is given below.

(ii) Classification of the terms used in watershed management

Table 1 gives a synoptic classification of the meanings andinterpretations employed in dealing with the subject of riverbasin management in Latin America and the Caribbean. The purposeof this classification is to facilitate comprehension of theactivities which may be coordinated in a river basin and of theaims of such coordination.

The table indicates the term used, in both English andSpanish, to designate types of river basin management. It hasbeen constructed by bringing together two groups of factors: (a)the stages on the river basin management process; and (b) thequantity of elements and resources taken into consideration inthe management process.

The stages in a river basin management process (1, 2 and 3):- Preliminary (1) : studies, planning and formulation

projects.- Intermediate (2) : investment in the preparation of the

river basin with a view to the utilization andmanagement of its natural resources for the purposes ofhuman development. This stage is associated in Englishwith the term “development”, e.g. “river basindevelopment” or “water resources development”, termswhich are normally translated in Spanish as “desarrollo decuencas” or “desarrollo de recursos hídricos o hidráulicos”.

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- Ongoing (3) : operation and maintenance of the completedstructural works, and management and conservation of thenatural resources and elements. In English, this stageis associated with the term “management”, which inSpanish has as many as four renderings: “gestión”,“administración”, “ordenamiento” and “manejo”. In general,“water resources management” is translated as“administración de recursos hídricos” and “watershed management”as “manejo de cuencas”.

The quantity of natural resources and elements taken into considerationon the river basin management process (a, b and c):- First group (a) : all the elements, resources and

infrastructure built by man in order to develop theriver basin to meet his vital needs.

- Second group (b) : all the natural resources and elementspresent in a river basin.

- Third group (c) : only the utilization and management ofthe water or water resources.

This is an original approach to the analysis of the terms.It is hoped that this classification will help clarify conceptsrelating to the objectives of river basin management. The tableindicates both the English terms and the meanings of theseexpressions in Spanish, the aim being to facilitate comprehensionof the terms in Spanish by relating them to the original conceptunderlying them.

It can be seen clearly from table 1 that the most completeform of watershed management is given in column (a) and isreferred to in English as “river basin development” in theintermediate stage and “environmental management” in the ongoingstage. This approach is equivalent to applying regionaldevelopment techniques and environmental management in relationto river basins. It is an approach which became fashionable inLatin America following the success of the Tennessee ValleyAuthority (TVA) established in 1933 in the United States, andgained a following in Mexico, Colombia, Brazil and Peru.

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The most common terms used to designate the agencies whichengage in this type of management are river basin corporations(Colombia, Peru and Brazil) and river basin commissions (Mexico).Most of these corporations and commissions came into being andevolved on the basis of major investment projects. Currently inColombia, following adoption of Law No. 99 of 1993, the riverbasin development corporations, classic examples of agencies withpromotional functions in the sphere of regional development, havealso been assigned environmental management functions.

The intermediate level of river basin management is given bycolumn (b), which includes actions aimed at coordinating thedevelopment and management of all the natural resources present ina river basin (natural resources development and management),including the water. This level of management of all the naturalresources in a river basin in an organized manner (planning ofriver basin use according to its properties and potential) isvirtually non-existent in its complete form in the region. Eachuser decides what to do on his own property without regard for the effect of hisaction on the dynamics of the river basin.

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Table 1. Classification of watershed management actions

Managementphases

Watershed management objectives

Utilizationand

integratedmanagement

Utilization andmanagement of all

the naturalresources

Utilization andmanagement ofwater only

(a) (b) (c)

(1)“Preliminary”

stage

Studies, plans, projects

(2)“Intermediate”

stage (Investment)

River basin development

(“Desarrollode cuencas”)

Natural resourcesdevelopment

(“Desarrollo oaprovechamientode recursosnaturales”)

Water resourcesdevelopment

(“Desarrollo oaprovechamientode recursoshídricos”)

(3) “Ongoing”phase

(Operation andmaintenance,

management andconservation)

Environmental management

(“Gestiónambiental”)

Natural resourcesmanagement

(“Gestión/manejode recursosnaturales”)

Water resourcesmanagement

(“Gestión/administracióndel agua”)

Watershed management (“Manejo/ordenación de

cuencas”)Source: Axel Dourojeanni, ECLAC, 1993.

Note: This table presents a matrix establishing the relationshipbetween management stages and objectives: (a) development andintegrated management; (b) development and management of all the

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natural resources; and (c) development and management of wateronly. The terminology used at each stage is indicated.

There exist neither systems nor agencies to facilitate thecoordination of the use and management of the natural resourcesin a river basin. However, there do exist numerous “river basinmanagement” programmes and projects. River basin or watershedmanagement has come to be a subcategory or part of thiscomprehensive approach to the management of natural resources andelements.

The classic approach to river basin management in the senseof management aimed at regulating the discharge of water from thebasin (a concept originally devised and applied in the UnitedStates) is one element of the natural resources managementapproach. River basin management can therefore be viewed as acombined activity linked to the management and conservation ofall the natural resources and elements and also to the specificmanagement of water (see table 1).

The third level of management, presented in column (c), isdirected towards the coordination of investments for waterresources development and their subsequent management. This isthe most widely known form of river basin management in LatinAmerica and has been the subject of most of the research andinvestment in hydroelectric plants and irrigation, drinking-watersupply and flood-control systems.

In Latin America and the Caribbean the norm has been to havepowerful management systems in place in the intermediate or“development” stage, directed towards the formulation andexecution of investment projects, especially in relation tohydraulic engineering. This is largely due to the fact that forthis stage there is normally substantial funding, politicalsupport, interest on the part of the banks supplying loans andscope for attracting better-paid professionals thanks to theexemption rules applicable to their contracts.

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By contrast, the ongoing or “management” stage, in whichdaily activities have to be coordinated in order to organize,manage or administer, for example, the water resources, the useof floodable zones, pollution control or the use of hillsides andthe operation and maintenance of a hydraulic works (except in thehydroelectric power sector and various drinking water services),has generally been very weak. This is the stage in whichimprovements need to be made on all fronts.

(iii) The meaning of “integrated” river basin management

In all river basins man is daily performing thousands of actions.The fact that he performs these actions does not imply that theyare automatically part of a process of river basin management,let alone an integrated part of that process. In order to form part ofa process of river basin management, such actions must first be coordinated withone another with due regard for their joint effect on the dynamics of the riverbasin and its inhabitants.

It is not necessary, however, to coordinate all the actionsexecuted in a river basin. Only certain actions have to undergothis process, such as decisions regarding flood control or themultiple use of a basin’s water. At least, some of these actionsyield better results if they are coordinated among the variousactors involved and if the dynamics and characteristics of awider territory are taken into account than is normally the case.

For the process of river basin management to be“integrated”, actions have to be performed which yield benefitsin both the productive and the environmental senses in the light ofthe basin’s behaviour. In addition, the management system has tobe such as to allow users to take part in decision-making in theinterests of equity.

The management of a river basin relies on the conjunction of twogroups of complementary actions:

One group of actions directed towards developing the natural resources (using, converting and consuming them) present on the

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river basin in order to boost economic growth, and a second groupof actions directed towards managing them (conserving, reclaiming and protecting them) with the aim of ultimately ensuringenvironmental sustainability. It might be added that these twogroups of actions must be performed with the participation of theactors, whether inhabitants or other parties having an interestin the river basin, with a view to seeking equity. This isconsidered to be implicit in the process of integratedmanagement:

Integrated management of (the natural resources of) river basins for thepurposes of human development = development of (the natural resourcesof) river basins for the purposes of economic growth + management of(the natural resources of) river basins for the purposes of environmentalsustainability.

Actions involved in both the development and management of ariver basin can also be divided into two groups:18

Group of technical or direct actions, also known as structuralactions or measures (studies, projects, works, operation,management);

Group of management or indirect actions, also known as non-structural measures (financing, standard-setting,organization).

2. Evolution of integrated river basin management

The evolution of the issues surrounding river basin management(management aimed at the coordination of actions in a riverbasin for various purposes) has been neither uniform nor steadyover the course of this century in Latin America. Differentmanagement systems have succeeded one another in an irregularfashion, and there have been cases in the past in which

18Axel Dourojeanni, “Bases conceptuales para la formulación de programasde manejo de cuencas”, paper presented at the First National Seminar on RiverBasin Management, Colegio de Ingenieros del Perú, 5-9 July 1993; published byECLAC under symbol LC/G.1749, Santiago de Chile, 17 November 1992.

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management, at least of water, has tended to be more integratedthan it is today.

In the initial stages, there was no more than limitedcoordination of river basin activities. Works were executedtaking account of the river basin in order to resolve isolatedproblems and specific or sectoral demands for water, such assafeguarding and improving navigation, supplying water tocommunities and irrigation zones, controlling floods, mitigatingdroughts and building hydroelectric power plants.

The next step was to operate and maintain the installationsconstructed. The type of management employed here was confined todealing with the constructed systems without any wider interesteither in multiple water use or “managing the river basin” (i.e.managing the natural resources of the river basin). Thus, theregion witnessed the implementation of a series of river basinwater management systems, a large proportion of which were solelyconcerned with the sectoral use made of the water, as in the caseof irrigation (Inspection Boards in Chile, Irrigation DistrictTechnical Administrations in Peru).

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From the late 1940s corporations began to be established forthe purpose of integrated (regional) river basin development.These corporations were based on the construction ofhydroelectric works and covered extensive areas under theirjurisdiction, making investments in a range of sectors.

In more recent times (1970), the issue of “river basinmanagement” has emerged with the main focus on mitigating thesilting-up of the dams constructed and controlling landslides andfloods. There have been very few cases in which all the naturalresources of the river basin—flora, fauna, woodlands and land—have been managed with a view to their development andconservation. Projects encompassing agriculture, forestry andpastureland have helped improve matters in this area but do notmake up for the lack of a coordination system for managingnatural resources on the basis of river basins.

The environmental issue made a much later appearance inLatin America (five to seven years after the Stockholm meetingin 1972). The first moves made were to perform environmentalimpact studies, followed by environmental analysis. To a greatextent, environmental management based on river basins went nofurther than performing research and proposing organizations.

In order to follow man’s evolution in executing coordinatedactions with reference to river basins, it is necessary to refer tofigure 4 in order to situate various management approaches whichtake account of the river basin as a whole according to stage ofexecution and the resources managed.

This figure gives a total of seven management approachesbased on river basins: three directed towards the development orpreparation of the river basin and four towards management,administration or organization of the environment, naturalresources or water. The terms assigned to these approaches areindicated in both Spanish and English to facilitate theiridentification and differentiation since, as already mentioned,these terms are used in a rather arbitrary fashion in Spanish.

Figure 4. Evolution of the coordination of actions based on riverbasins

(river basin management)

“Preliminary” and

“Intermediate” stages

(3) Riverbasin

development

Naturalresources

development

(1) Waterresources

development

“Ongoing”stage

(5)Environmentalmanagement

Naturalresources

management

(2) Waterresourcesmanagement

(4)Watershedmanagement

Source: Devised by Axel Dourojeanni, ECLAC, December 1993.

The chronological order in which the coordination of actionsin relation to river basins has taken place in Latin America isas follows (see the numbers in figure 4):

First, the subject of the control and utilization of waterthrough river basins was tackled by constructing hydraulicworks (“water resources development”);

Second, the subject of water administration through riverbasins was addressed (“water resources management”);

Third, a direct transition was made to regional developmentbased on river basins (“river basin development”);

Fourth, attention was given to watershed management, withthe primary aim of controlling the erosion that wasaffecting the dams constructed and also controllinglandslides and torrents;

Fifth, a direct move was made towards dealing with the issueof environmental management on the basis of river basins(“environmental management”).

The most important point to be noted in this process of evolution is the factthat there was an abrupt move taken towards coordinating, at least on paper,environmental management on the basis of the river basin and region19 withoutthe development and management of all the natural resources in a river basin yetbeing fully coordinated.

It should be borne in mind, however, that if there is nocoordinated management of natural resources, or even water,“environmental management” becomes impossible. It is necessary toat least start by managing water in an integrated manner and thenprogressing to the other natural resources “associated” withwater. River basin agencies fulfil both these functions.

Below, the evolution is presented of just four types ofriver basin management, two aimed at development or preparationand two at management:

19This is confirmed by the establishment of the Regional AutonomousCorporations (31) in Colombia under the Ministry of the Environment (Law No.99 of 16 December 1993). The purpose of these corporations is to implementnational policy on natural resources and the environment.

Management with a view to integrated development (orregional development) based on river basins (“river basindevelopment”);

Management with a view to the development and utilization ofwater resources (“water resources development”);

River basin management or the organized and coordinatedmanagement of the natural resources of a river basin(“watershed management”);

Administration of water based on river basins, particularlyfor the purposes of multiple use, the control of extremephenomena and monitoring of water quality (“water resourcesmanagement”).

A. Evolution of the subject of river basin management in LatinAmerica

Irving Fox20 traces the origins of the river basin developmentapproach in the United States back to 1808, when a report byAlbert Gallatin put forward a proposal for unifying the nation bymeans of river transport systems based on improving thenavigability of the rivers and building canals. The three decadesbetween 1870 and 1900 saw the birth of the ideas which underliethe concept of river basin development”. These ideas emerged as aresult of the actions taken by the Corps of Engineers on theMississippi River to improve its navigability and institute floodcontrol. In 1870 the Mississippi River Commission was founded,followed by the Missouri River Commission in 1884. The rationalebehind these new entities was that water resources developmentcould only proceed on the basis of a regional approach combinedwith integrated project planning. The project-by-project approach wascostly and ineffective.

The Bureau of Reclamation was set up in 1902 for the purposeof dealing with the drier regions of the United States. The ideaof planning river basin development evolved with the execution ofmajor hydraulic works. In 1933 TVA and the National ResourcesPlanning Board came into being, the latter body holding thatriver basins should be treated as a single unit. Even thisworking group endeavoured to have river basins used as a basisfor national economic planning, a cause which failed and was nottaken up again. The contributions made by these organizationswere influential in the organization of river basin agencies inthe region.

This model of river basin management was adopted in LatinAmerica largely through the influence of TVA, which, as alreadymentioned, was established in the United States in 1933. The

20Irving Fox (1964), “Review and Interpretation of Experiences in WaterResources Planning”, Organization and Methodology for River Basin Planning, WaterResources Center, Georgia Institute of Technology, Atlanta ,Georgia, UnitedStates, pp. 105-132.

subject is referred to in Latin America as “integrated riverbasin development” or “river basin development”.

One of the Latin American countries that has probably mademost use of this approach from the outset is Mexico, a countrywhere many regional development activities were focused on riverbasins and explicitly based on the successes achieved by TVA aswell as the lead given by the numerous river basin commissionssubsequently established in the United States, such as theCommissions for the Savannah, Altamha, Saint Marys, Apalachicola-Chatthoochee y Perdido-Escambia rivers, which were founded in1958. Thus, between 1947 and 1960, the Papaloapán Commission inMexico came into being, together with several other suchcommissions, including the Caduca Valley Corporation in Colombia(1954) (see box 1), the Río Santa Corporation in Peru and the RíoSan Francisco Corporation in Brazil (see box 2).

Box 1

Methodological evolution of river basin management(background to the current approach of the Caduca Regional

Autonomous Corporation)Historically, three stages may bediscerned in the process of theadministration of river basinsdeveloped by the Caduca RegionalAutonomous Corporation (CVC), cor-responding chronologically to threeconsecutive decades: Protectionist approach. This approach

evolved during the first years,when CVC was beginning toorganize its river basin admi-nistration (1958 to 1968), itsphilosophy being focused on thesolution of biophysical problemsas the basis for managing therenewable natural resources inriver basins; actions were aimedat isolating the river basin inorder to avoid any human activitywithin it, and the officialsbehaved as though they were thestrict guardians of a zone whosemain function was seen as waterproduction.

Multipurpose management approaches.When CVC began to initiate majorprojects, the need was identifiedfor proper management of theriver basins directly affected bythose projects; in their case,there was established a properadministrative structure underthe guidance of a forestry oragronomic expert, who wasassigned the task of formulatingthe relevant management plan.

The management plans drawn up inthis manner were more a reflectionof the author’s academic trainingthan the specifics of the areaanalysed, and their projects wereoriented towards providing one-offsolutions without regard for theinterrelationship between differentspheres (biophysical, social andeconomic). The execution of theseprojects called for considerableinvestment and were almost alwaysfunded wholly by CVC without theconsent of the community or theparticipation of other bodies.These management plans required abroader vision with regard to theidentification of problem areas andthe definition of solutions. Theirmain defects were attributed to thefollowing: inadequate informationregarding the proposed objectivesand an insufficientlymultidisciplinary vision in theformulation of the plans.

Integrated management approaches. Asa direct response to the resultsobtained in the previous stage,measures were initiated to achievethe formulation of integrated riverbasin management plans, suchmeasures being introduced in 1978when, under Law 2a of that year,CVC was given confirmation of itsfunction of managing the naturalresources in its area of operation.

Source:Fernando Alavarez, “Modelo de manejo de cuencas en la CVC”, MemoriasPrimer Congreso Internacional del Agna, 21 to 25 September 1993. Medellín

Exhibition and Convention Centre, Water Corporation.

There were various reasons behind the establishment of theriver basin commissions and corporations. In political terms, theriver basin commissions or authorities set up for the purpose ofregional development signified a direct central governmentpresence in some deprived regions and afforded the opportunityfor central intervention in the regions with a view to theexecution of major works during a given term of government withall that meant in terms of political impact. From theadministrative point of view, these authorities were an importantfactor in that they provided a means for:

Controlling major investments by central government andfacilitating control by the banks providing the loans;

Avoiding the rigid constraints imposed on public spendingthrough the creation of autonomous or semi-autonomousagencies with special regimes for securing funds anddetermining expenditure;

Planning and coordinating public spending on river basinsshared by a number of regions, thereby avoiding potentialconflicts of interest among them;

Planning development of multiple water use and thusgenerating economies of scale (the same principle as forprojects related purely to water resource development).

Box 2

The Río San Francisco River Basin Development Corporation, Brazil

The first institution establishedfor the specific purpose of managingthe development of the Río SanFrancisco valley was the SanFrancisco Valley Commis-sion (CVSF),founded through Law No. 541 of 15December 1948. It came under thedirect authority of the presidencyand was assigned a fixed income of 1per cent of union taxes. Itundertook actions directly andmonitored those of other agencies.The general plan was sent toCongress on 15 December 1950, itsmain focus being “control of thevalley’s water”, a prerequisite fornavigation, irrigation andhydroelectric energy generation,while the former uncoordinatedscattering of efforts and short-termism were condemned.

In 1950/51 a number of actionswere identified as being necessary,including the following: researchfor general planning pur-poses,hydraulic engineering projects to

During the Commission’s existence(until 1967) two major works ofhydraulic engineering wereconstructed: the San Franciscohydroelectric power plant and theTres Marías dam.

During the period from 1964 to 1967,the United States Bureau ofReclamation furnished technicalassistance to CVSF. On completion ofthis assistance, the San FranciscoValley Superintendence (SUVALE) wasestablished under Decree Law No. 292of 28 February 1967. An evaluationwas made of the valley’s resources.SUVALE was placed at the head of theregional authorities and there-forehad to follow the directives ofSUDENE regarding the plans,programmes and projects to beundertaken in the North-East ofBrazil. Its main undertaking was inthe area of irrigation. Between 1971and 1974 an irrigation schemecomprising 500,000 hectares waselaborated with the help of

regularize river water flow,research and construction works inconnection with services fornavigation, electri-city powerplants, irrigation projects, roadsand highways, town planning,urbanization, regularization oftributaries, the building of schoolsfor agricultural and livestock-farming extension programmes, mobileand stationary hospital networks,animal health protection andfunding.

technical assistance provided byFAO.

Finally the San FranciscoValley Development Company(CODEVASF) was established under Law6.088 of 16 July 1974, therebyreplacing SUVALE.

Source:

ECLAC, “Gestión Ambiental en Grandes Obras Hídricas: ProyectoSobradinho integrante del Plan Global de Desarrollo del Valle de RíoSan Francisco” (Environmental management in major hydraulic works:the Sobradinho project, part of the Comprehensive Development Planfor the Río San Francisco Valley), Doc. E/CEPAL/PROY.6/R.4, 29September 1981.

The main regional development programmes based on riverbasins, executed first of all in Mexico, were assigned to riverbasin commissions (see box 3). The main river basins developed bysuch commissions founded in Mexico between 1947 and 1960 were thefollowing: the Papaloapán river basin, including the basin ofthis river and adjacent basins which empty into the Pacific,46,500 km2 (1947); the basin of the Grijalva-Usumacinta rivers,120,000 km2 (1951); the Tepalcatepec basin (17,000 km2) andBalsas basin (100,000 km2), developed in 1947 and 1960respectively. (The Tepalcatepec River Basin is a tributary of theRio Balsas, for which reason the Balsas Commission established in1960 absorbed the former commission.) The Fuerte river basin,29,000 km2 (1951) and the Santiago de Lerma y Chapala basin(1950).21

21David Barkin and Timothy King, “Regional Economical Development—TheRiver Basin Approach in Mexico”, Siglo Veintiuno Editores (published in Spainin 1970 under the title “Desarrollo económico regional (enfoque por cuencashidrológicas de México”). The study was written between 1963 and 1969 anddeals with the problem of evaluating large-scale development projects whichwere performed for a number of different purposes and whose success dependedon the reaction of the private sector rather than the action of the publicsector, in the context of Mexican efforts to promote regional development through

The authority of the commissions in charge of river basinregional development programmes not only encompassed investmentin water resources for the purposes of flood control, irrigation,hydroelectric power and drinking water supply, but also extendedto the establishment of communication systems, industrial andagricultural development, town planning and land settlement.

Europe also had some influence in the sphere of integratedriver basin management. First Spain and then France contributedtowards establishing a school of thought in this area.

According to Guillermo Cano and Joaquín López, twoArgentinian lawyers who made an important contribution towardsthe analysis and propagation of the issue of integrated riverbasin management, the Spanish Decree of 5 March 1926 appears tobe one of the earliest historical documents to enshrine in lawthe notion of the river basin for the purposes of planning itsintegrated development.22 The new Spanish Water Act, brought intoeffect on 1 January 1986, strengthens the river basin authorities(see box 4).

In France, river basin agencies were established on 16 December1964 and came into operation in 1967 and 1968. Their mainattributes include their self-financing capability, theparticipation of the river basin communities in a “waterparliament” and their improved efficiency with regard topollution control.

The French model has evolved in the course of twenty yearsas greater weight has been given to environmental considerations.The new French Water Act of 3 January 1992 establishes the principle ofcomprehensive water management, water being viewed as a resource belongingto the public domain. In addition, a water department has been set

integrated investment projects in river basins.”22Guillermo Cano and Joaquín M. R. López, “Las cuencas hídricas como

unidades óptimas para la planificaión y administración de los recursoshídricos. Participación de los usuarios en tales actividades” (River basins asoptimum units for planning and administering water resources. Userparticipation in such activities), Fiftieth anniversary of the foundation ofthe river basin confederations in Spain, Zaragoza, Spain, 8-12 November 1976.

up within the Ministry of the Environment. The water agencieshave become the most important executive bodies for theapplication and monitoring of environmental standards because oftheir role in water quality control.

Recently, in 1988, France began directly transferring itsexperience in integrated river basin management to LatinAmerica.23 During this year, a French mission took place inBrazil with the aim of initiating the Río Doce project inconjunction with the National Water and Energy Department(DNAEE). The project was launched in 1989 as a result of thismission. This experience is also being transferred to othercountries, such as Chile, Peru and Venezuela. The French approachemphasizes the management of multiple water use with specialreference to management of the quality of water resources and theenvironment in general.

23Department of the Environment under the Prime Minister, Water. Frenchtechnology, “Label France” Collection, paper prepared by the Institut dessciences et des techniques de l’équipement et de l’environnement pour ledéveloppement, Paris.

Box 3

Regional economic development: ariver basin approach in Mexico According to Barkin and King,Mexico’s river basin commissionswere founded between 1947 and 1960for the same general purpose as manyof the decentralized entities: toundertake specific programmes whichdid not fit into the existinggovernmental structure in a clear orobvious way. From the technicalpoint of view, however, thesedecentralized entities neverthelesslacked autonomy, being directlyaccountable to the Department ofWater Resources, created in 1948.Once it had been decided toimplement a large-scale investmentprogramme in some isolated regionsof the country, commissions wereestablished to assign the funds andset up the necessary administrativemechanism to allocate them. One veryattractive feature of these organizations istheir ability to work in different statessimultaneously and to coordinate the effortsof the different departments in order toimprove the overall capital stock of a region.The river basin commissions wereentrusted with a wide variety oftasks and proved themselves to be aflexible instrument of regionalpolicy. In some cases, thecommissions took charge of regionalinvestments that had been theresponsibility of other statedepartments or governments. On otheroccasions, their main function wasto plan and coordinate investmentsby other authorities. In the first

the Construction of irrigationsystems, flood control andhydroelectric power generationrepresented only part of thecommission’s total investments;funds were also spent on roadsystems, schools, the improvement ofurban facilities and public healthservices. The extent of the roleplayed in this regard depended onthe priority assigned by thePresident and his principal advisersto the particular investmentprogramme formulated by eachcommission. Within their budgetaryconstraints, each commission had atits disposal a wide range of meansfor comprehensive regional planning.The second type of activity, namelycoordination of the functions ofother bodies working in the sameregion, was more problematic anddepended largely on the influenceand competence of their staff. Here,the commissions were not able tomake demands but merely to encouragesuch cooperation and they lacked theresources necessary to undertakethemselves the functions of otherbodies if the latter refused tocooperate. As one might expect, thenormal rivalry between the bodiesconcerned made this difficult inpractice.

In this type of situation, theinfluence of the senior executiveofficial can be crucial in

case, the clear focus forinvestments in water resourcesand

determining the commission’ssuccess, and the extent of hispersonal political influence canmake a real difference.

Source:

David Barkin and Timothy King, “Desarrollo económico regional(enfoque por cuencas hidrológicas de México)”, Siglo VeintiunoEditores, original title in English: “Regional Economic Development—The River Basin Approach in Mexico”, published in Spain in 1970 onthe basis of work prepared between 1963 and 1969.

River basin development approaches along the lines of thoseapplied in the late 1940s in Mexico have lost some of theircurrency in Latin America, except in the case of relatively lessdeveloped regions such as the Saldaña river basin in Colombia.Even now, however, parallel situations continue to arise and needto be coordinated in order to reestablish the type of integratedapproach required for coordinating management processes directedtowards sustainable development based on river basins:

A greater capacity for regional development throughdecentralization, whereby regional authorities are maderesponsible for the development of the river basins in theirterritory;

A greater level of communal responsibility through newmunicipal functions, including the management of municipalriver basins;

A redefinition of the role of the public and private sectorsin management processes aimed at river basin development,especially in water use management;

Greater pressure for multiple use of water as well as agreater predisposition to suffer adverse effects due toextreme phenomena resulting from more extensive landsettlement;

Greater openness to external interventions in river basinsthrough easy investment facilities and commercial openings toother countries, resulting in the incorporation of new actors.

Box 4

River basin authorities in Spain

Under the Spanish Water Act, riverbasin authorities were establishedwhich will, however, keep theirtraditional title of “river basinconfederation”. The term “riverbasin” refers to the area of land inwhich water flows to the sea alongchannels which converge in a finalsingle channel.

By establishing that the riverbasin is the basic unit of watermanagement, the Act considers it tobe indivisible. It is therefore anappropriate next step to establishauthorities based on the territorialreach of natural river basins. Theindivisibility of the river basin isalso the reason why river basinconfederations will encompass one ormore undivided river basins withoutbeing subject to any limitationsother than those imposed byinternational borders.

The functions of the river basinconfederations are as follows:

To formulate the hydrologicalplan of the river basin;

To administer and supervisepublic ownership of water power;

To administer and supervisedevelopments which are of generalinterest or affect more than oneAutonomous Community;

To plan, build and operate theirown hydraulic works and thoseassigned to them by the State;

To plan, build and operate worksresulting from agreements withpublic authorities (AutonomousCommunities, local corporations,

To draw up its budget; To arrange for the necessary

credit transactions for itsmanagement; and

To prepare business fortransmission to the WaterCouncil;

To adopt agreements regarding theconfederation’s property;

To examine the boundaries withinwhich new groundwater concessionsmay not be granted unless theholders of the existingconcessions constitute a“community of users”.

The Users’ Assembly is made upof those users who are members ofthe so-called “Operating Board”. TheAssembly’s function is to coordinateoperation of the hydraulic works andwaters in the entire river basin. Itmay not intervene, however, inexisting concessions, nor in therights of the users. For example,the Assembly may concern itself withensuring that there is sufficientwater available both for irrigationand for domestic purposes. However,if you possess a concession to fillyour trout-breeding tanks with riverwater, the Users’ Assembly may notprevent you from doing so.

The Operating Boards coordinatethe operation of the hydraulic worksand the waters of a system ofrivers, a single river, a stretch ofriver or a hydrogeological unitwhose uses are particularlyinterrelated. The Boards may notintervene in the use of the water

etc.), as well as companies inthe private sector orindividuals.

Their powers and tasks includethe following: Issuing authorizations and

concessions, except in the caseof works and ventures of generalState interest, which fall withinthe purview of the Ministry ofPublic Works and Town Planning(MOP)U;

Inspecting and monitoring worksundertaken on the basis of theabove concessions andauthorizations;

Performing evaluations andhydrological studies, filingflood reports and monitoringwater quality;

Studying, planing, executing,conserving, operating andimproving the works included intheir plans or assigned to the;,

Defining water quality targetsand programmes;

Providing technical services and,upon request, advising centralgovernment, the AutonomousCommunities, local corporationsand other public and privatebodies, as well as privateindividuals.

The President of each RiverBasin confederation is appointed andsupervised by the Council ofMinisters at the request of MOPU.The same official presides over theGoverning Board, the Users’Assembly, the Reservoir Commissionand the Water Council.

The composition of the GoverningBoard can vary from one river basinto the next, but will in all cases

made by a party holding a concessionor authorization. For instance, takethe example of a river whichsupplies water to the population forhousehold use, to a hydroelectricpower plant, to a plain cultivatedfor market gardening, for irrigationand to a paper factory. The Boardensures that the river water is usedin an appropriate way to permit allthese activities. However, if byvirtue of your concession orauthorization, you are entitled tofill your swimming pool and waterthe gardens of your hotel, you maynot be prevented from doing so butyour entitlement has to beaccommodated in such a way as tocause no prejudice to the rights ofother parties.

Users have a majoritymembership on the Operating Boards,in proportion to the respectiveinterests of the various sectors inthe use of the water and the serviceprovided to the Community.

The Reservoir Commission isresponsible for proposing the regimefor filling and emptying the riverbasin reservoirs and aquifers. AWorks Board may be established bythe Governing Board at the requestof the prospective users of anapproved construction work. Theusers will then be members of thisBoard and thus be kept directlyinformed about the progress of thework and its impact.

The Water Council isresponsible for sending to theGovernment, through MOPU, thehydrological plan for the riverbasin and any subsequent revision.In addition, it may provide

include representatives of thefollowing:

The National Government; The Autonomous Community or

Communities, if they wish to berepresented;

The users of the water.

Representatives of the usersshall comprise at least one thirdof all voting members of the Boardand, in any case, a minimum of threepersons. Given that irrigators, forexample, tend to have differentconcerns from those of theelectricity companies, the Actprovides that the representation ofusers shall reflect their respectiveinterests.

information on any matters affectingthe river basin. Its composition mayvary from one river basin to anotherbut it must, at all events, includerepresentatives of the following: Every ministry whose scope of

competence bears upon the use ofwaters;

Users, who must comprise at leastone third of all voting membersand whose composition mustreflect the respective interestsof the different sectors in wateruse;

The technical services of theconfederation;

The Autonomous Communities.

Source:

Ministry of Public Works and Town Planning (MOPU), El libro del agua. Guíade la Ley de Agnas (The Water Book. Guide to the Water Act), Madrid,1985.

What this means is that regional and municipal authoritiesnowadays have direct responsibilities in the field of river basinmanagement. As a result, there is an imperative need to have inplace an agency for the management of natural resources,especially multi-use water supply, at the level of the riverbasin. The need for river basin water agencies to coordinate actionsaffecting that resource, and especially to monitor water qualityand extreme phenomena such as floods and landslides, is thereforequite urgent in the case of most of the major river basins, evenmore so if they can provide a basis for improving environmentalmanagement.

B. Evolution of the issue of water resources development in LatinAmerica

The development and control of water resources to satisfy humanneeds and protect human beings from dangerous situations (known

as “water resources development”) has a very long history in theregion. Even before the Inca epoch, major irrigation works wereconstructed, on the northern coast of Peru, for example, andsubsurface irrigation and climatic control systems in thehighlands (Waru-Waru) and in the Río Magdalena valley. In fact,the development of water resources is as ancient as humanprogress.

Since the beginning of this century, Latin America and theCaribbean in general have been the site of a large number ofwater resources projects based on river basins within the contextof “water resources development”. These projects have generallybeen managed for specific sectoral purposes. The main activitiesof this type have been directed towards the development ofhydroelectric power, the regulation and distribution of water forirrigation and drainage purposes, and drinking water supply andsanitation.

Economic and social development in Latin America and theCaribbean have been accompanied by a significant increase in theuse of water resources. This increased use has been supported byconsiderable investment in infrastructure and in industrialprojects related to water. During the 1980s, however, andespecially following the economic recession of 1982 and 1983,investment in water-related projects in most of the countriesfell far below the levels expected in the early 1980s and also inthe 1970s.

Although it is not possible, on the basis of the informationavailable to make detailed estimates of the volume of investmentin water-related activities, the extent of the works executed bythe main sectors using water—irrigation, hydroelectric power anddrinking water—gives some idea of the magnitude of theinvestments made. However, investments in the 1980s inhydroelectric power, irrigation, drinking water and sanitationprojects were estimated as constituting between 0.8 and 0.9 per

cent of the region’s gross domestic product (GDP), i.e. 4-5 percent of gross fixed capital formation.24

Irrigation-based agriculture has a long-standing traditionin Latin America and the Caribbean. The ever greater pressure toincrease agricultural production of food and industrial rawmaterials, for both internal consumption and export, as well asthe powerful political impact of the new irrigation plans, haveresulted in recent decades in a considerable expansion of theterritory under irrigation. According to estimates by FAO,the total irrigated land in the region increased from around 10.1million hectares in 1970 to approximately 15.7 million hectaresin 1990.25 This indicates an annual average growth of irrigatedland of some 280 thousand hectares.

Hydroelectric power is one of the main sources of energy inLatin America and the Caribbean. The successive increases in oilprices during the 1970s enhanced the attractiveness ofhydroelectric power and, as a result, many countries in theregion embarked on intensive programmes to develop this source ofenergy. From 1970 to 1991 the net installed capacity forhydroelectric power production in the region increased from amere 18.9 million kW in 1970 to almost 98.8 million kW in 1991.26

This yields an average annual increase in the net installedcapacity of hydroelectric power plants of some 3.8 million kW.

24ECLAC, América Latina y el Caribe: financiamiento de las inversiones relacionadas con losrecursos hídricos en el decenio de 1980, LC/R.904, Santiago de Chile, 29 November 1990.

25FAO, direct information, November 1992.26United Nations, Department of Economic and Social Affairs, Statistical

Office, World Energy Supplies 1950-1974, ST/ESA/STAT/SER.J/19, New York, 1976; andUnited Nations, Department of Economic and Social Information and PolicyAnalysis, Statistical Division, 1991 Energy Statistics Yearbook, ST/ESA/STAT/SER.J/35,New York, 1993.

The Governments of Latin America and the Caribbean have longsince recognized the importance of drinking water supply andsanitation and have achieved considerable progress in this area.According to the most recent estimates (1992), around 333 millionpersons, or 80 per cent of the urban population and 53 per centof the rural population, have access to drinking water, andalmost 285 million or 74 per cent of the urban population and 30per cent of the rural population, to sanitation.27 By comparison,in 1971, 78 per cent of the urban population and 24 per cent ofthe rural population had access to drinking water, while 38 percent of the urban population and 2 per cent of the ruralpopulation had access to sewerage or other facilities.28

The yield from these sectoral investments in the countriesof Latin America and the Caribbean up to 1986 permitted theconstruction of around 1,500 big dams more than 15 metres inheight, including more than 500 over 30 metres in height.29

In previous decades, in various countries of Latin Americaand the Caribbean, such as Peru and Mexico, investments in water-related projects, especially irrigation and hydroelectric powerprojects, absorbed a high percentage of public investment. Thecost of a major irrigation project on the Peruvian coast is wellabove the 500 million dollar mark. In practice, although theseare deemed to be irrigation projects, this being their maindeclared purpose, they are more akin to human settlement projectsin the arid or semi-arid areas of the Peruvian coast.

27Pan American Health Organization (PAHO), Pan American Health Office,Regional Office of the World Health Organization (WHO), Plan regional de inversionesen ambiente y salud. Antecedentes estratégicas fondo de pre-inversión, September 1992. Theestimates refer to the population thought to be supplied with drinking waterand sanitation systems.

28PAHO, WHO, Environmental Health Programme, International Decade ofDrinking Water and Sanitation Supply. Report on the progress of work in theregion, Environmental Series No. 6, Washington, D.C., 1987.

29The International Commission on Large Dams (ICOLD), information fromInstitute of World Resources, World resources 1992-93. A guide to the globalenvironment (New York, Oxford University Press, 1992).

The basic reason for these large investments is the powerfulpolitical impact of such projects, together with the contentionthat the State’s role in water resources management should focuson the adoption of direct measures in the public sector aimed atincreasing economic development through major capital projects.

A large proportion of these river basin initiatives have notinvolved an integrated management approach. There continue to becases, for example, where it is not until a reservoir becomessilted up that measures are taken to control erosion or where adam is not planned for the purposes of multiple use despite thisbeing a possibility. It can therefore be stated that over 70 percent of investments in water resources development in riverbasins have been directed towards sectoral ends.

C. Evolution of the issue of river basin management in LatinAmerica

Managing a river basin means taking coordinated action affecting the naturalresources of the river basin with a view to their recovery, protection and generalconservation and at the same time exerting control over discharge of watercaptured by the river basin in terms of quantity, quality and time.

River basin management has been undertaken ever since manfirst used the natural resources related to water. The mostspectacular river basin management systems, those based on theterraced land, include the Peruvian systems, such as the ColcaValley in Arequipa. Many of these systems date back to pre-Incatimes. The types of management employed were not the same,however, throughout all the Latin American cultures, and afterthe encounter between Europe and Latin America the systems usedfor organizing population distribution and managing the riverbasins gradually declined and disappeared. Consequently, what isbeing recommended today is a task that used to be accomplished inmany regions of Latin America, especially in the High Andesregion.

It is estimated that in Peru alone there are almost half amillion hectares of terraced land that have been abandoned orneed to be reclaimed for agricultural use. The reclamationincludes the reforestation of the upper parts of the river basinin order to assist the renewed infiltration and flow ofgroundwater, as has been done in Aylambo, Cajamarca, Peru.30

As an academic discipline or as part of the initiatives promoted bygovernments, the subject of river basin management received scantattention, even in countries with a tradition of undertaking suchinitiatives, such as Peru in the early 1960s.

This is not to imply that no river basin authorities werecreated but simply that those authorities did not include as partof their remit tasks concerned with managing river basins, evenif the water itself was managed. Before the 1960s, precedence wasgiven to “developing” river basins in the sense of upgrading themfor the purpose of using their resources, controlling floods,

30Pablo Sánchez, Jorg Yáñez y Raúl Ho, Manual Silvoagropecuario; based on theexperiences of the Forestry and Farming Service of Cajamarca NationalUniversity, 13 volumes published by the Commission of the Cartagena Agreement(JUNAC), Lima, 1987.

using the land for agriculture, livestock farming and forestryand establishing communities, industries and mine workings.31

As regards natural resources management, in Latin Americathe area tackled first was soil conservation, followed by riverbasin management and more recently environmental sustainability.In none of these three areas has success been achieved inimproving population organization, at least in the rural areas(organized in soil conservation districts or according to riverbasin), so that such activities could be undertaken on acontinuing basis.

A large number of soil conservation programmes and evenriver basin management programmes were established (see boxes 5and 6). There were more “programmes” than anything else,precisely because they were associated with funding. This doesnot mean that the existence of such programmes led to thecreation of management agencies in the river basins in which theprogramme was implemented. In general, the programmes did notlast long enough to have any impact on the organization of thepopulation, to obtain and transmit research findings, to preparemanuals and methods or carry out other activities with a view tostrengthening the coordination of the management of naturalresources in river basins.

31This lack of regard for the imperatives of management (in terms ofconservation, preservation and so forth) was common to all fields. Thought wasgiven only to the needs of irrigation rather than drainage, it was endeavouredto make maximum use of the groundwater rather than maintaining a balance withrecharge, mine tailings were dumped directly into natural lakes, and so on.

In the present century, the term “soil conservation” was thefirst to be “imported” into Latin America from the United States.This happened in the 1940s thanks to the influence of the UnitedStates Soil Conservation Service (SCS). However, national soilconservation systems along the lines of SCS have not flourishedor been maintained in the region.

The terminology of “river basin management” was brought tothe region recently in the mid-1960s mainly by former scholarshipstudents for the most part from Peru, Colombia and Venezuela whohad studied at Colorado State University and also by variousspecialists who undertook research or study travel in other NorthAmerican centres. Recently, starting in 1970, there began toappear programmes entitled “river basin management” inuniversities, ministries and river basin corporations includingthe Caduca Corporation in Colombia.

Box 5

River basin management programmesin Peru

In Peru, the first River Basin ManagementProgramme elaborated by the Ministry ofAgriculture was introduced in 1974. Thiswas followed by successive revisionsmodifying its operation. In 1980 a projectentitled “National Programme of SoilConservation and River Basin Waters” waslaunched with funding by AID. Thisprogramme was also revised a number oftimes. In May 1988, the National RiverBasin Management and Soil-ConservationProgramme (PRONAMACCS) was re-establishedunder Agrarian Sector Organizational Act(Decree Law 424) and a Supreme Decree(002-88-AG), assigning the programme thefollowing objectives:

“The objective of the National RiverBasin Management and Soil-ConservationProgramme is to formulate and establish at

(c) To formulate, propose and coordinateplans and projects designed to permitriver basin management and to lay theinfrastructural and social bases for ruraldevelopment; (d) To promote awareness-raising andencourage coordination with civicorganizations in the generation of riverbasin management “models” for the short,medium and long terms;(e) To periodically update the NationalInventory of Terraces and TraditionalHydraulic Works with a view to planningand implementing initiatives aimed attheir rehabilitation and maintenance; (f) To design technological packages ofa technical and social character and todevelop training and publicity strategieswith a view to their implementation for

the national level a set of policies,strategies and initiatives of a technicaland administrative nature with a view torational development of the availablenatural, human and financial resources,through integrated river basin managementand soil conservation; and, further, toassist in the performance and updating ofthe Inventory and National Evaluation ofTerraces and Traditional Hydraulic Workswith a view to their rehabilitation anduse in agricultural production.

The National River Basin Management andSoil-Conservation Programme shall have thefollowing functions:

(a) To propose and coordinate theformulation and implementation of policiesand strategies relating to the developmentof river basin management and soilconservation;(b) To organize, offer advice on andexecute together with public and privateinstitutions, regional and localgovernments and civic organizationsinitiatives relating to river basinmanagement and soil conservation, and alsoto evaluate their application;

the purposes of river basin management,with due regard for the effective use ofeconomic, financial and human resources;(g) To supervise the execution ofcoordinated initiatives under the RiverBasin Management Plan, with due regard forthe effective use of the economic,financial and human resources;(h) To review and comment on technicaldocuments relating to river basinmanagement and soil conservation presentedby the Deputy Minister of NaturalResources and Rural Development, and bythe National Commission for the Programme;

(i) To discharge any other functionsassigned it by the Deputy Minister ofNatural Resources and Rural Development.”

This Programme has recently beengiven a new name—the “National River BasinManagement and Soil-Conservation Project”(PRONAMACCS).

Source: Ministry of Agriculture, Regulatory Provisions Governing the Organization and Functions ofthe National River Basin Management and Soil-Conservation Programme (Lima, 1988), pp. 1and 2.

Box 6

Evolution of programmes for the development and management of high Andeanwatersheds in Venezuela

In the years 1961 and 1962 in Venezuela theidea was conceived of a new working methodto form part of a conservationist drivebased on not using State workers for theimprovement of farms with erosion problemsbut on involving the farming communityactively. Thus, the initial idea was borneof the “Conservationist Aid Programme”

These three management plans togetherrepresent an intention to carry on thework of the Conservation Aid Programme andalso serve as a means of attractingfunding for the conservation of the riverbasins.

In the second half of the 1970s a

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which, after a number of modifications,took its final form in 1965 and 1966. Theaim of the programme was to involve farmersin areas affected by erosion in theconservation, development and use ofrenewable natural resources, while at thesame time improving their social, economicand cultural level through speciallytargeted training. The programme operatedalong those lines until 1973 and alwaysachieved a high rate of implementation andthe active participation of the farmingcommunity.

In 1973, the Watershed managementPlanning Office was established, thisagency being the one in charge of soil andwater conservation programmes. Nowadays,the programmes are more oriented towardsthe purely hydrological dimension, butconservationist aid programmes arenonetheless maintained in various highAndean watershed zones.

For 1975, as part of the NationalIntegrated Watershed Organization andManagement Plan, the River Basin ManagementPlan for the Chama and Mocotíes Rivers wasformulated with two subprogrammes, one forprevention and the other for recovery. Inthe same year the River Basin ManagementPlan for the Negro and Boconó river wasunveiled, which also envisaged preventiveand corrective measures. The basicobjectives of the plan were the following: Prevention objectives :- halting of the destructive advance of thenatural resources;- development of conservationist educationcampaigns;- regulation of the use of farming land. Resource recovery objectives :- erosion control in farming areas;- creep and sediment control;- reforestation of degraded areas.

For the year 1976, the River Basin

major change occurred in this programme,namely the establishment of the Ministryof the Environment and Renewable NaturalResources (MARNR). Within this Ministry,the Department of River Basin Managementwas created, its activities being directedtowards the development of water resourcesthrough hydraulic engineering works. Underthe authority of this body, a programme ofriver basin management was conceived witha large number of activities relating tostudies, projects, soil and waterconservation, reforestation, re-greeningand maintenance of the hydraulicinfrastructure, all these activities beingaimed at controlling the processes oferosion and sedimentation of the highwatersheds, regulating the streamflowregime and controlling river water levels,while also attempting to prevent anydecline in water quality, regulatetorrential flooding and reduce majorsedimentation inputs into watercourses andreservoirs. These activities also coverthe control of wild fires, flood-controland protection measures, sanitationengineering works and integrateddevelopment.

In general, this programme has beenachieving its goals and has receivedadditional support from conservationistaid and local conservationist groups,especially in the Andes region.

While in this general vein, we shouldnot omit to mention the five-year plan forthe period 1979-1983, whose purpose was toorganize the annual activities of theDepartment of River Basin Management ineach of the country’s states. Neithershould we neglect to refer briefly to theRiver Basin Management Programme set forthin the 1977-1980 Andes DevelopmentPlan. This programme is aimed atestablishing multiple use, or in otherwords, the development and utilization of

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Management Plan was announced for theUribante and Caparo rivers, this planhaving the same principles, aims andorganizational structure as the above-mentioned management plans.

all the resources, with a view to andservices satisfying the social, economicand cultural needs of the users with theleast possible damage to the soil andother environmental resources andattempting to rectify actions causingtheir impoverishment or destruction.

Source: Gonzalo Peña, Evaluación y diagnostico de las estrategias, programas y proyectos utilizados o formuladospara el desarrollo y manejo de cuencas de alta montaña y/o zonas de la región andina en Venezuela en elperiodo 1970-1985 y proyecciones hacia 1990, Economic Commission for Latin America and theCaribbean (ECLAC), Natural Resources and Energy Division, Water Resources Unit,Working Document, November 1986. Document prepared for discussion at theInternational Seminar on Integrated Systems for the Development and Management ofRiver Basins in the Andean region of Latin America, Commission of the CartagenaAgreement (JUNAC), Lima, 24-28 November 1986; and Gonzalo Peña, “¿Quien infringela ley: el campesino o nosotros?”, Ambiente, No. 12, June/July 1978.

Numerous bilateral projects also contributed to layingfoundations for a river basin approach, albeit without theconnotations of the earlier ones. For example, Canada in themanagement of the Lebrija River Basin in Colombia, Italy in thestudies on the Bío-Bío basin in Chile and the United States AIDin projects in the Peruvian Sierra and the Regional River BasinManagement Project of the Tropical Agronomic Centre for Researchand Education (CATIE) for Central America and Panama, to name buta few, all participated in the execution of river basin projects.None of these projects, however, was aimed at strengtheningpermanent river basin management systems, as in the casesmentioned earlier.

D. Evolution of water administration in Latin America

The importance of the water-related development projects executedin Latin America and the Caribbean in recent decades has promptedall the countries in the region to design relatively complexsystems for the administration of water resources. Given the longhistory of water use and the importance of water administrationagencies in the region’s historical development, a brief accountshould be given of the stages in the development of thisadministration in order to place the more recent history of theattempts to modernize administrative systems on the basis ofEuropean and North American models in their true perspective.

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(i) Evolution of modern water administration 32

The development of the modern stage of water administration inLatin America and the Caribbean (see figure 5) began when, aftergaining independence, the countries began strengthening theirinstitutions and adopting formal constitutions. Although themodern notions of such administration were not institutionalizedby these constitutions, they nevertheless established theconstitutional right to fiscal intervention and thus laid thefoundations for the development of modern water administration.

Although there are many studies that analyse the modernhistory of water administration in the region, the tendency inthe most typical types of study is to fail to distinguish betweenthe various approaches taken to the subject (see table 1). Inorder to follow the evolution of water administration in theregion, it is helpful to refer to figure 4, which gives asynopsis of the different management styles and situates themaccording to stage of execution and the resources included forthe purposes of administration. The chronological order followedin the evolution of water administration in the region is asfollows (see figure 4):

First stage. Since the turn of the century, in Latin America and theCaribbean in general, the subject of the control and utilizationof water has been tackled through the execution of hydraulicprojects adopting the “water resources development” approach.Such projects have generally been prepared for specific sectoralpurposes and were relatively limited in scope, which meant thatthey could be administered locally. Thus, until the 1920s, theagencies in charge of water resources tended to be local and tohave limited functions (typical examples were the municipal

32On the basis of information contained in United Nations, EconomicCommission for Latin America and the Caribbean (ECLAC), “The management ofwater resources in Latin America and the Caribbean”, Estudios e Informes de la CEPAL71, LC/G.1523-P, Santiago, Chile, April 1989; and United Nations, EconomicCommission for Latin America and the Caribbean (ECLAC), “The water resourcesof Latin America and the Caribbean and their utilization”, Estudios e Informes dela CEPAL 53, LC/G.1358, Santiag de Chile, August 1985.

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enterprise for drinking water supply, the users’ associationusing the same watercourse for irrigation and, towards the end ofthe nineteenth century, the private hydroelectric utility).

73

Figure 5. Stages of water management

Source: United Nations, Economic Commission for Latin America and theCaribbean (ECLAC), “Management of Water Resources in Latin America and theCaribbean”, Estudios e Informes De la CEPAL 71, LC/G.1523-P, Santiago, Chile, April1989.

Second stage. As a result of more intensive water use, it becamenecessary to tackle the subject of water administration, and inthe 1920s the local agencies began to be supplemented or replacedby State agencies with a wider geographical—often national—scope.With the establishment of the National Irrigation Commission in1926 with the mandate of executing large-scale irrigation worksand building large dams for water control, Mexico became apioneer in the creation of national agencies. However, in mostcountries in the region and with regard to virtually all uses ofwater, the strengthening of national agencies began in the 1930swith endeavours to counteract the effects of the depression,

1980

1970

1960

1950

1940

1930

1920

1910

1900 Codification of waterlegislation

Development of single-agencies at thenational level

Specipurposeagencies

Individualmanagement

water

Decentralizationof water

Regional

dimension

ofmanagement

Use ofmultipurpose riverbasin

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whereas in some countries it was not until the 1960s that theestablishment of national agencies gained strength. In contrastto functions directed towards the formulation and implementationof investment projects, which always were and still are the mostpowerful, functions directed towards management or administrationwere generally, with very few exceptions, extremely poorlyendowed and continue to be so.

Third stage. Without having strengthened their national wateradministration agencies, the countries of Latin America and theCaribbean moved directly to the stage of building hydraulic worksfor regional development purposes.

External influences became an important factor in theevolution of management policies with the creation of fundingagencies and international and regional development agenciestowards the end of the 1940s. Their activities began to achieveconsiderable scope and influence at the beginning of the 1950sand contributed to acceptance of the role of investment inhydraulic works as a means of achieving economic development.This notion, and the fact that the public sector was assuming amuch greater role in the national economy, triggered majorchanges in the administration of water resources. The result ofthis change was the first agency specifically established forwater management at the national level: the Ministry of WaterResources (SRH), set up in 1948 in Mexico, with a broad scope ofcompetence in respect of water resources. A number of othercountries established similar institutions.

As already mentioned, with regard to river basins this newfocus on the role of investment was equivalent to applyingregional development strategies based on river basins.

In many countries the trend towards the establishment ofspecial agencies for the management of specific tasks or areascontinued. Consequently, during the 1950s and 1960s, in line withthe models recommended by the international organizations, therewas a strengthening in the region of centralized agencies withresponsibility for specific uses of water: hydroelectricity,

75

irrigation, drinking water supply and sanitation. Other agencieswere established for the purpose of assessing the water resourceand water quality and, perhaps, achieving a measure ofcoordination.

Fourth stage. Whereas the need to “develop” water resourceswas given priority in the countries of Latin America and theCaribbean before the 1960s, at the beginning of that decade therebegan to be a shift towards the gradual emergence of the need to“conserve” resources, which led in turn to the emergence of theissue of “river basin management”. This issue came to the foreagain with even greater prominence around the 1970s, mainly inconnection with the control of erosion that was affecting thedams constructed and also the control of landslides andtorrential flooding. However, it should be pointed out that therewere actually few cases in which all the natural resources of ariver basin were managed with a view to their utilization andconservation. Moreover, success has still not been achieved instrengthening the organization of such management activities on apermanent basis. Some improvement has been achieved throughprojects relating to agriculture, forestry and pastureland, butthese did not make up for the lack of a coordination system forthe management of natural resources in river basins.

As already pointed out, the concept of the river basin isnot widely applied in the regions’ water management, andmachinery for resolving conflicts at the river basin level isseldom encountered. There have been sporadic applications of theconcept in various countries, but, with the exception ofColombia, there are few contemporary examples (even this countrymay be considered a questionable exception since the regionaldevelopment corporations are not primarily water managementagencies, nor are their spheres of competence defined by thelimits of the river basins). The concept is not even very widelyapplied in the field of planning. As regards integration andconflict resolution, these tend to take place at the much higherand more centralized, decision-making level. However, there arecertain indications to suggest that fresh consideration is being

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given to the importance and practical use of this concept inwater administration.

Fifth stage. In more recent times—at the end of the 1980s,i.e. several years after the Stockholm Meeting in 1972—the issueof environmental management surfaced in Latin America andCaribbean, the countries of the region transferring their focusabruptly without having fully coordinated the activities involvedin the development and management of natural resources. In thiscontext, the water administration agencies tend to be rathermarginalized in the process of environmental management. It istherefore quite normal that environmental considerations areimposed upon the process of administering water resources fromoutside by international financial institutions, ministries ofhealth and general codes of environmental contact.

(ii) Contemporary water management systems 33

The institutional structures adopted in the countries of LatinAmerica and the Caribbean show considerable variations, which maybe partly due to the fact that the scale and complexity of theproblem of administration also vary in a region in which thecountries are very diverse and in which differences also derivefrom the nature of State government, i.e. whether it is federalor unitary. Furthermore, the diversity of administrative systemsalso reflects the eclectic adoption of outside influences intheir formation. Despite the considerable variations from countryto country, at the end of the 1970s the administrative systems ofthe countries of the region could be grouped in three very broadcategories, as follows:

Administrative systems made up of numerous institutionsactive in water management, with only weak centralcoordination;

33On the basis of information in United Nations, Economic Commission forLatin America and the Caribbean (ECLAC), “The management of water resources inLatin America and the Caribbean”, Estudios e Informes de la CEPAL 71, LC/G.1523-P,Santiago, Chile, April 1989.

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Administrative systems having a mechanism for the centralcoordination of policy, but characterized by a high degreeof institutional decentralization of responsibilities forspecific uses of water;

Administrative systems characterized by a completecentralization of authority and little or no delegation ofresponsibilities.

These marked differences in institutional structures amongthe countries of the region made it impossible to claim thatthere was one prevailing style of water administration in LatinAmerica and the Caribbean. In general, however, the degree ofgovernment involvement was considerable in all the countries,although it tended to be less marked in the countries in thefirst category, more so in those of the second, and still more soin those of the third category. Conversely, the private sectorwas more active in water administration and economic incentiveswere given a greater role as an administrative tool in countrieswithin the first category than in those in the other twocategories.

(iii) Recent innovations in water management policy 34

In terms of the countries of Latin America and the Caribbean, theyears since the United Nations Mar del Plata Conference can bedivided into two vastly dissimilar periods. The first, whichended in the early 1980s, was marked by unprecedented economicgrowth. It was followed, however, by the most serious economicrecession since the 1930s. Both the boom and the recessiondeflected interest away from the public sector and this, in turn,has been reflected in the lack of innovation in the field ofwater administration. Indirectly, however, both periods hadrepercussions in this sphere.

34On the basis of information in United Nations, Economic Commission forLatin America and the Caribbean (ECLAC), The Administration of Water Resources in LatinAmerica and the Caribbean, LC/G.1694, Santiago de Chile, 24 September 1992.

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The boom of the late 1970s marked the climax of theexpansion of public-sector economic activities, which weretypified by a number of major water-related projects. In mostcountries of the region, the role of the State in the economy wasundergoing serious reconsideration, the objective being to reducepublic spending within the context of fiscal austerity, measures,especially as regards capital investment, and to increase theefficiency of services by transferring responsibilities to theprivate sector or, at least, to financially autonomous Statecompanies.

One result of this policy has been the privatization ormunicipalization of many activities involving the use of water;in such instances, the central government administration retainsresponsibility for licensing, but not for operations. Suchpolicies are not being pursued to the same extent by all thecountries of the region, but they have become quite widespreadand mark what is perhaps the first major change in wateradministration trends in the past fifty years. The steadyexpansion of State has been halted. The context in which wateradministration is discussed has changed. The opportunity haspossibly been created for the general adoption of institutionalarrangements based on a concept of integrated water resourcesmanagement whose application involves shifting much of theresponsibility for the management of water use away from thecentral government administration and towards local government,autonomous State companies or the private sector.

Policy innovations introduced in the area of watermanagement by different countries in recent years confirm thistrend. The reforms show various dissimilarities, but they are alldirected towards the possible future creation of water managementsystems applying concepts such as integrated and coordinatedwater management but also drawing a clear distinction between theresponsibility entailed by management of the resource and thatentailed by management of its use. This initiative was promptedby a desire to redefine the role of government in general. Forexample, in Chile a water administration system has beenestablished which distinguishes between the responsibilities of

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the public sector for the resource and the obligations of usersregarding its administration. These reforms have created anenvironment within which a user-based integrated system ofmanagement might be developed. Mexico has for many years had avery centralized administration system for water resources. Thissystem has recently undergone radical reforms in the direction ofa decentralized administrative system which clearly distinguishesbetween supply and use management. In Brazil, in contrast, theexplicit adoption of a system of integrated river basinmanagement is the core of the proposed new policy. Thesedevelopments are positive signs for the future of watermanagement in Latin America and the Caribbean as a whole.

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Part II

Technical dimension of watershedmanagement

This chapter gives an outline of the technical actions undertaken ineach of the four main types of watershed management:

Technical actions for the purpose of integrated riverbasin development;

Technical actions for the purpose of multiple wateruse;

Technical actions in connection with river basinmanagement; and

Technical actions in connection with wateradministration.

In each case, a list is given of typical actions undertakenin each type of management on the basis of examples obtained fromcase studies

1. Scope of technical actions in the context ofintegrated river basin development

As stated above, as a category, actions directed towardsintegrated river basin management35 resemble those undertaken forregional development purposes. River basin agencies have beenestablished largely with a view to their use as regionaldevelopment agencies, the entire area covered by the river basinbeing taken as their area of jurisdiction.

In the guidelines for the development of the Río Saldañariver basin, drawn up by the Tolima Regional AutonomousCorporation (CORTOLIMA) in Colombia, the river basin regionaldevelopment approach is judged to be similar to thattraditionally adopted by the Mexican river basin commissions andthe river basin corporations in other countries, such as Brazil.

The CORTOLIMA development plan states that the overallpurpose of development “is optimal management of water and theother natural resources of the river basin as part of a steadyprocess of improving the economic and social well-being of itsinhabitants and producing results which are distributed equitablyin accordance with the principles of social justice. As anelement of this objective, it is sought in the long term, over aperiod of 20 years, to bring the per capita GDP of river basindwellers into line with that of the country as a whole. In amedium term of 10 years, the aim is that the river basin’seconomy should continue to increase in strength and productdiversification so that its trade deficit can be partlyeliminated”.

The general development aims for the Rio Saldaña river basinare set out in box 7, which presents details of the general andspecific strategies of this development programme. The regionaldevelopment alternative for the river basin is to increase theproduction of the agricultural sector and to diversify itseconomy. The aim is that a process of self-sufficiency will beinitiated for various items of the family basket so that thedeficit can be reduced and a surplus generated.

35United Nations, Economic Commission for Asia and the Far East (ECAFE),Multiple-purpose river basin development. Part 1. Manual of river basin planning. Flood control seriesNo. 7, ST/ECAFE/SER.F/7, New York, March 1955, reprinted in July 1966.

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The basic strategic plan includes among its elements theconception of the river basin as a system, the strengthening ofthe region as a territorial unit, equitable regional development,community involvement and the improvement of its trade balance.In order to achieve these ends, the basic sectors chosen are theagricultural and agro-industrial sectors and their supportservices in the form of road construction, marketing andfinancial and government services.

Box 7

Content of an integrated river basin development programme basedon a regional development approach

(Case of the Río Saldaña river basin,Colombia)

The following are the generalobjectives for development of theRío Saldaña river basin: To protect the Río Saldaña river

basin against factors leading toits degradation or deteriorationand to establish the managementof this watershed;

To achieve integrated planning ofthe river basin and to strengthenthe region as a territorial unitwith a view to its balanceddevelopment;

To develop and conserve thepotential of the river basinwaters for the purpose of itsoptimum utilization;

To conserve and make better useof the natural resources andother environmental elements forthe benefit of the community;

To raise training, employment andincome levels among thepopulation;

II. Specific strategies orientedtowards rural areas To administer and efficiently

manage water resources; To establish regulations for the

design, planning and conservationof highways and routes connectingtowns and villages at both theregional and local levels;

To conserve, preserve and improvesoils and draw up regulationsgoverning the use of agriculturalmaterials;

To promote reforestation inmicro-river basins and demarcateareas for special management;

To promote studies for theidentification and inventory ofwoodland species and evaluatemixed forestry activities;

To identify plant and animalspecies and geological formationsin national nature parks;

To promote regional studies for

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Box 7

Content of an integrated river basin development programme basedon a regional development approach

(Case of the Río Saldaña river basin,Colombia)

To promote the expansion andupgrading of economic,agricultural, stockbreeding,forestry, fisheries, agro-industrial, industrial, artisanaland tourism activities;

To improve the trade balance byincreasing the supply of foodsand products from other sectorsof the domestic market andgenerating possible surpluses forexport abroad;

To contribute more substantiallyto the GDP of the country and theprovince;

To achieve higher rates ofemployment of the availablelabour force and of personsjoining the labour force in thecoming years;

To achieve better coverage of thepublic with regard to basicservices such as education, heathand housing and to achievegreater public involvement in theresults of regional economicactivity; and

To promote arrangements forcoordination among institutionsand between agencies and thepublic in order to ensure jointaction and implementation ofprogrammes and projects.

I. Specific strategies orientedtowards social services

To promote the construction of

the purposes of geologicalprospecting and mining;

To draw up plans for ecologicalstudy of the river basin;

To promote biological andfisheries research.

III. Specific strategies orientedtowards regional economicdevelopment

To develop integrated productionunits for supplying a largerportion of the food products inthe rural family basket;

To stimulate the application ofmodern crop-cultivationtechnology in hilly and flatareas;

To diversify crops and promotethe cultivation of lesser-knownspecies;

To encourage crop rotation andimproved woodland and pasturelandmanagement, and topromote smallforest plantations of native andexotic species;

To improve and adapt high-qualityspecies and monitor losses due tothe use of forestry resources;

To promote the sowing of non-perennial crops in associationwith forestry plantations;

To promote the construction offish farms using moderntechnology;

To promote the agro-industries; To promote mining operations;

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Box 7

Content of an integrated river basin development programme basedon a regional development approach

(Case of the Río Saldaña river basin,Colombia)

aqueducts, extend supplynetworks, introduce water treat-ment processes and ensureeffective coordination of theservice providers;

To promote the construction ofsewage disposal systems andimprove the existing systemsthrough action coordinated withthe service providers;

To promote the construction ofwastewater treatment systems;

To encourage the family to adoptsensible practices in relation tothe use and conservation ofnatural resources And theenvironment;

To seek the involvement of thecommunity and municipalauthorities in regulatory,operational and monitoringactivities in connection with theIntegrated Management Plan;

To coordinate the activities ofagencies responsible forproviding health, educational andhousing services.

To encourage the skills andaptitudes of the population inorder to generate new areas ofartisanal activity based on theregion’s raw materials;

To encourage the establishment ofnew enterprises and strengtheningof existing ones by stimulatingproductivity;

To promote forms of partnershipaimed at streamlining the supplyof raw materials, production andmarketing in order to yieldhigher revenues for producers;

To promote technical assistanceand training for members of thecommunity;

To build and improve roads andhighways in order to facilitatetransport services, connectproduction zones with marketingcentres and improvecommunications systems.

Source:

National Planning Department, Tolima Regional Autonomous Corporation(CORTOMLIMA), La planificación de cuencas: bases para el desarrollo de la cuenca del RíoSaldaña. Informe—resumen, Colombia, pp. 24-28.

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2. Scope of technical actions aimed at the multipleuse of water resources

The approach known as “water resources development”36 has formany years been translated into Spanish as “desarrollo” of riverbasins or water. We have preferred in this study to refer to thisapproach as “aprovechamiento” of water resources since this termexpresses more fully the intention to use natural resources suchas water for the purposes of human development.

The concept of river basin or water development originatedin colleges of hydraulic engineering, which formulated projectsaimed at balancing water supply and demand in order to meet thedemand of each sector of users in a river basin or interconnectedwater resources system and to control extreme phenomena, such asflooding. With their increased competence for water use, thecolleges have focused on the development of water for purposes ofmultiple use or simply multiple water use.

Under this approach, which was predominantly focused onhydraulic engineering, the purpose of the development was to makethe most effective use of the available water resources, throughwater supply control, in order to meet the demands of economicand social growth and to protect the population against extremeevents. In many of the plans drawn up with these aims,environmental issues were not initially taken into considerationexcept insofar as they directly affected the aims of the projector the works constructed.

Technical actions directed towards the use andadministration of water are normally executed in accordance withan iterative three-stage cycle (see table 2):

In the first (preliminary) stage research is carried outwith a view to the planning and organization of the use and

36Sanitary Engineering Educational Programme of the Universities ofVenezuela, published proceedings of the Seminar on Water ResourcesDevelopment, sponsored by the World Health Organization and the United NationsDevelopment Programme, Maracaibo, Venezuela, 11-16 February 1968.

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conservation of the river basin water resources. This stage normallyconcludes with the design and funding of hydraulicengineering programmes and projects;

In the second (intermediate) stage the programmes orprojects designed in the first stage are implemented. Thiscorresponds to the stage of upgrading the river basin in order toadapt it to human needs. During this stage, engineering worksare constructed and services established. It is the stage ofmajor investment. In English, it is known as “waterresources development”;

The third (ongoing) stage refers to the administration ofthe system constructed and the management of the naturalresources. This is the stage of watershed management andwater resources management, inter alia, aimed at development andconservation of the river basin’s natural resources;

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Table 2. Direct technical actions in water development andmanagement processes

Stagesindicatingthe timeperiod ofthe actions

Principal actions Complementary actions

Preliminary Formulation ofwater development

studies

Water inventories Evaluations and water

balance Analyses

Formulation ofwater development

projects

Prefeasibility level Feasibility level Final and implementation

levelIntermediat

eExecution of

projects (“WaterResources Development”)

Design for execution purposes

Execution and trials Supervision

Ongoing

Wateradministration(“Water resourcemanagement”)

(management ofconstructed

hydraulic systems)

Organization of water users

Operation and maintenance of hydraulic works

Repair and improvement of works and equipment

Watershedmanagement

(management of thenatural resources

of the riverbasin)

Organization of river basin users

Organization of the use ofthe river basin resources

Preservation and protection of river basin resources

Reclamation and conservation of the natural resources of theriver basin

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Result: Alignment of water supply and demand and environmental sustainability in the river basins

Source: Axel Dourojeanni, ECLAC, 1992

Objectives relating to the development of river basins arelinked to the natural resources with respect to the followingcategories of action:

Use or development actions; Production and processing action;. Mining or extractive actions; Actions resulting in degradation or destruction.

The review of multiple water-use programmes since 1947 findsthat, while in some cases measures have been adopted with a viewto both the use and management of the river basin (for thepurposes of environmental sustainability), in other cases theissue of environmental protection has been and continues to beignored. It is common in the literature to encounter “moreintegrated” approaches to the development or use of waterresources in the 1950s than in subsequent years.

In 1950, for example, in a report by the United States WaterResources Policy Commission,37 there appeared a list ofobjectives to be included in a plan for multiple water use (seebox 8) in which the subject of river basin management (andenvironmental sustainability) was included among the water useactions.

In this box the objectives of water use (for economicpurposes) and the objectives of water management (for purposes ofenvironmental sustainability) are mixed up together.

With the passing of time more environmental factors wereincorporated as a greater appreciation was gained of the damagecaused by destruction of the environment. The first issue ofconcern was flooding and silting, followed by water quality and

37Water Resources Policy Commission, Report of the President, Vol. 1, p.47, United States Government Printing Office, 1950, Washington, D.C.

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its effect on human health, and then the effects of waterdeterioration on flora and fauna, and finally deterioration ofthe landscape and climate change. At present, moreover, there areeven a number of projects which aim to reverse the effect ofmajor hydraulic works on streamflow and to reclaim swampland thathas dried out or the bends in a river whose course has beenchanged.

The development aims set out in box 8 are as follows:irrigation (2); hydroelectric power (3); shipping (4); householdand industrial use (5); and recreational use (7).

The management aims indicated in the same box are: floodcontrol (1); river basin management (6);38 fish and wildlifemanagement (8); pollution control (9); insect control (10);drainage (11); sediment control (12); salinity control (13); andcloud seeding (15).

It should be pointed out that some authors regard riverbasin management as including all aspects of control, protection,conservation, reclamation and other environmental activities,whereas others, such as the members of the commission thatdrafted the 1950 water policy, see river basin management more asan activity that accompanies and complements flood control, waterquality control and other functions, as indicated in box 8.

In this box, the activity of river basin management islisted as activity No. 6, which refers exclusively to theforestry and small-structures dimension of the issue, inaccordance with the concept of river basin management as it isunderstood in the United States. In this study regarding LatinAmerica and the Caribbean, however, the term “river basinmanagement” is given a much broader interpretation along thelines of the following: “river basin management denotes the set

38This aim of river basin management is limited in scope to thehydrological and forestry component, which only includes soil conservationpractices, woodland and pastureland management, gully control, and smallsediment barriers to be constructed in the headwaters of larger river basins,and does not correspond to the much broader interpretation of river basinmanagement current in Latin America and the Caribbean.

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of actions designed to ensure the environmental sustainability ofa river basin”.

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Box 8

Elements of a river basin water resources planSerial No. ofelements

Objectives Type of work andmeasures

1. Flood control Flood mitigation andprevention, protectionof economicdevelopment, regulationof water supply,regulation of flowregime, artificialground water recharge,water supply,hydroelectric powerdevelopment, protectionof life.

Dams, storagereservoirs, dykes,holding walls,improvement of canals,emergency evacuationchannels, pumpingstations, zoning offlood regions, floodforecasting.

2. Irrigation Agriculturalproduction.

Dams, reservoirs,wells, canals, pumpingplants, vegetationcontrol in canals anddrains, sedimentcontrol, supplysystems, drainage, landlevelling.

3.Hydroelectricity

Supply of energy foreconomic developmentand improvement ofliving standards.

Dams, reservoirs,recharge canals, powerplants, transmissionlines.

4. Shipping Transport of goods andpassengers.

Dams, reservoirs,canals, floodgates,improvement of canals,improvement ofharbours.

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Box 8

Elements of a river basin water resources planSerial No. ofelements

Objectives Type of work andmeasures

5. Drinking and industrial watersupply

Supply of water forhousehold, industrial,commercial, municipaland other purposes

Dams, reservoirs,wells, inlets, pumpingplants, treatmentplants, desalinization,supply systems.

6. River basin management

Land conservation andreclamation, sedimentcontrol, runoffretardation,improvement ofwoodlands andpastureland, protectionof water sources

Land conservation,management of woodlandsand pastureland,control of headwaterstructures, dams, slag-retention dams, farmponds.

7. Recreational water use

Improvement of humanwell-being and health

Dams, structures,pollution control,preservation of naturalparks, preservation ofareas of scenic value.

8. Management offish and wildlife

Improvement of thehabitat of fish andwoodland habitats,reduction or preventionof negative effects ofhuman activity on fishand woodland habitats,improvement of sportsamenities, facilitationof the expansion ofcommercial fishing.

Woodland wildliferefuges, fish farms,fish ladders and nets,dams, streamflowregulation, sowing ofrivers and dams,pollution control, landmanagement.

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Box 8

Elements of a river basin water resources planSerial No. ofelements

Objectives Type of work andmeasures

Continuation...9. Pollutioncontrol

Protection orimprovement of waterflow regime formunicipal, household,industrial,agricultural andrecreational uses andaquatic life.

Treatment plants,regulatory dams toincrease streamflowduring periods of lowstreamflow, seweragesystems legislation.

10. Insectcontrol

Public health,protection ofrecreational use,protection of woodlandsand agricultural areas.

Design and satisfactoryoperation of dams andassociated structures,drainage and insect-control measures.

11. Drainage Agriculturalproduction, urbandevelopment andprotection of publichealth.

Drainage channels,drainpipes, undergrounddrains, pumpingstations, soil washing.

12. Sedimentcontrol

Reduction of sedimentload in currents anddam protection.

Soil conservation,proper management ofwoodlands, properconstruction of roadsand railways, sedimentcontrol, torrentcontrol.

13. Salinitycontrol

Reduction or preventionof saline pollution ofwaters used foragricultural,industrial andhousehold purposes.

Regulatory dams toincrease streamflowduring periods of lowflow, barriers,artificial groundwaterrecharge.

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Box 8

Elements of a river basin water resources planSerial No. ofelements

Objectives Type of work andmeasures

14. Cloud seeding Rainfall control withinmeteorological limits.

Portable equipment forcloud seeding withsolid particles, earthgenerators.

Source: Adapted from A water policy for the American people, Report of the President’sWater Resources Policy Commission, 1950, United States Government PrintingOffice, Washington, D.C., Volume 1, p. 47, quoted in United Nations, EconomicCommission for Asia and the Far East (ECAFE), Multiple-purpose river basindevelopment. Part 1. Manual of river basin planning. Flood control series No. 7,ST/ECAFE/SER.F/7, New York, 1955, p. 3.

In Edward Kuiper’s book entitled “Water ResourcesDevelopment”,39 published in 1965, the activities recommended forthe development of river basin resources are limited to hydraulicengineering. The following list of activities is given:

Collection of basic data: hydrological, geophysical, socio-economic, legal and organizational data;

Economic forecasting based on population growth and activitiesto be performed over different target periods;

Calculation of water demand for domestic purposes, irrigation,shipping, hydroelectricity, flood control and recreation;

Formulation of hydraulic infrastructure plan and strategy to align watersupply and demand: dams, canals, treatment plants,hydroelectric plants and other hydraulic and servicestructures.

In this process priority is given to water use, alternativeplans are designed and finetuned, economic analyses performed andthe most satisfactory options selected on the basis of the

39Edward Kuiper, Desarollo de Recursos Hídricos, translated into Spanish andpublished as a limited edition by the Centro Interamericano de Desarrollo deAguas y Tierras (CIDIAT), Mérida, Venezuela, May 1969. The original title inEnglish is Water Resources Development, Butterworth and Co., England, 1965.

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available information. Environmental concerns are not a subjectof analysis in this strategy.

The approach taken by economists was crucial in creating abroader understanding of the development of water for thepurposes of multiple use. John V. Krutilla and Otto Ecksteincontributed to this process by collating the experiences of TVA,the Bureau of Reclamation, the United States Corps of Engineersand other entities in relation to the economic dimension of suchdevelopment.40

In 1964, a report was published on economics and publicpolicy in water resources development by Iowa State Universitywith contributions by S. V. Ciriacy-Wantrup, John Krutilla, RayLinsley and Kenneth Boulding, among others.41 The studiesperformed by these research scientists laid the foundations forwater economics and the economics of natural resources ingeneral.

The incorporation of simulation and optimization techniquesin relation to integrated river basin management improveddecision-making processes still further after the Second WorldWar. A classic text from 1962, in the sense that it opened up theoption of applying optimization and modelling techniques indecision-making with respect to the analysis of water systems,was that developed by a group of researchers from Harvard whoinvestigated the design of water systems and introduced newtechniques for relating such development to economic objectives,engineering analysis and governmental planning.42

40 John V. Krutilla and Otto Eckstein, Multiple purpose river development,Studies in applied Economics, Resources for the Future, Published by JohnsHopkins Press, Baltimore 18, Maryland, USA, 1958.

41Stephen C. Smith and Emery N. Castle, Economics and public policy in waterresources development, Iowa State University Press, Ames, Iowa, United States,1964.

42Arthur Maas, Maynard M. Hufshmidt et al., Design of water-resources systems: newtechniques for relating economic objectives, engineering analysis, and governmental planning,Harvard University Press, Cambridge, Massachusetts, United States of America,1962.

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In the 1970s the use of mathematical models to guidedecision-making with regard to multiple water use emerged as amajor new development.43 This decade saw the first of a largenumber of both simulation and optimization models of surfacewater and groundwater systems, the simulation models being themost widely used in decision-making relating to water management.

In the mid-1970s, the environmental variable began to beincorporated with special emphasis on water quality control firstof all and then on environmental management in general. OAScontributed to the inclusion of environmental issues inintegrated river basin development with its book entitled“Calidad ambiental y desarrollo de cuencas hidrográficas: unmodelo para planificación y análisis integrados” based onfindings obtained through studies of the Río Bermejo river basin,which forms part of the Plata river basin.44

The process of incorporating environmental considerations inmultiple water use has been slow, uneven and generally belated.Ideally, the ongoing administration of water and management ofwater river basins (for the purposes of maintaining theirenvironmental sustainability) should be carried out from theoutset in conjunction with any development rather thanseparately.

At the present time, the fact that river basin management“projects” or actions are being proposed separately from thoserelating to water administration generally implies that theresources have been poorly utilized and that, as a result,control and reclamation operations have to be carried out, suchas erosion-control operations to protect a dam which is rapidlysilting up.

43Anales del Simposio Internacional sobre la Planificación de RecursosHídricos, Volumes I and II, Ministry of Water Resources, Mexico City, Mexico,1972.

44Organization of American States (OAS), Calidad ambiental y desarrollo de cuencashidrográficas: un modelo para planificación y análisis integrados (Environmental quality andriver basin development: a model for integrated planning and analysis),Washington, D.C., 1978.

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It needs to be pointed out that in the countries of theregion, and even within a single country, there are no uniformwork patterns relating to river basins. At the end of thecentury, hydraulic engineering works are still being executed inan isolated fashion, without forming part of an integratedmanagement strategy, while in other places actions are beingperformed in river basins with the due degree of coordination aspart of an integrated approach. This situation is partly due to alack of communication and national coordination systems.

Decision-making techniques taking account of economic,social and environmental considerations have progressedtremendously in the countries outside the region. In LatinAmerica and the Caribbean, however, they are still not applied onthe necessary scale despite the fact that an integrated planningapproach to the utilization of river basin water resources isadopted in numerous studies.

The main obstacle consists essentially in the lack ofintegrated management systems capable of applying the findings ofthe research undertaken. To a large degree, the subject of themultiple development of water uses or river basin uses has beenconfined to studies and plans, which is where the bulk of theliterature for the region is to be found.45

Operations actually executed have remained exclusivelywithin the sphere of hydraulic works for specific purposes suchas irrigation or hydroelectric power generation, in contrast tothe multiple purposes indicated in the studies. The necessarycomplementary approach balancing utilization and management forconservation and protection purposes has also remained a distantgoal.

45See the study by Alberto Viladrich on “Planificación hidráulica y losplanificadores”, Editorial Universitaria, Santiago de Chile, 1972, and alsonumerous studies collected in Resúmenes de documentos sobre recursos hídricos,published by ECLAC in the INFOPLAN series: Temas Especiales de Desarrollo, No.3, January 1987, Santiago de Chile.

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3. Scope of technical actions in the sphere ofwatershed management

Actions relating to watershed and water management, as explainedin the first chapter, form part of integrated river basinmanagement. Their purpose is to ensure the environmentalsustainability of the river basin in the course of the activitiesdesigned to develop its resources.

Technical actions properly falling within the scope of riverbasin management are directed towards the preservation,reclamation, control, protection and conservation of both thenatural resources and the human population of a river basin ordependent on its resources (see table 3 and box 9).

In practice, river basin management actions should not beperformed separately from those aimed at developing naturalresources such as water. Development (for economic purposes) andmanagement (for environmental purposes) form part of the triangleof the objectives which are complementary to social,environmental and economic equity (see table 3).

In the literature it is common for no distinction to bedrawn in the Spanish language between the terms “manejo”,“aprovechamiento” and “gestión”. Expressions such as “manejointegral de cuencas”, “gestión de cuencas”, “manejo de cuencas”,“ordenamiento de cuencas” and other similar terms are usedinterchangeably but with different connotations each time.

What we can say for sure is that “manejo de cuencas” denotesactions, carried out either in isolation or in combination withproductive actions, which maintain the environmentalsustainability of the river basin.

River-basin management actions must be performed on a continuing basisin order to contribute to environmental sustainability and to the steadydevelopment of natural resources and elements, as well as to

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protection of the river basin’s human population against extremenatural events.

Programmes bearing the title of “river basin management” arerarely confined to aspects of protection, conservation,reclamation or preservation because they are normally implementedin association with actions of a productive nature relating tothe use, processing or extraction of natural resources.

As can be inferred from the foregoing, in practice there is nosuch thing as a single river basin management programme, but rather “packages”of projects which, in combination, succeed in developing theresources of the river basin without destroying them.

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Table 3. Direct actions linked to the management of the natural resources and elements ina river basin

Examples of directactions

Environmentalsustainability ...

..... ...Economicgrowth

Integrated management of natural resources in riverbasins

Management of waters and river basins Development of waters and riverbasins

Preservation andreserves

Reclamationandrehabilitation

Protectionandmonitoring

Conservation

Utilization

Productionandprocessing

Mining andextraction

Degradation anddestruction

Rational useManagement of parks andProtection ofSoil erosion controlFlood controlLand reclamationSoil conservationManagement of forestwildlifeWater resourcesdevelopmentRecreational fishingIrrigation and drainageFish breeding

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Hydroelectric powergenerationMiningToxic waste disposalIntegrated river basin management

Source: Prepared by the Natural Resources and Energy Division, ECLAC, 1992.

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Box 9

Technical actions under a riverbasin management programme

For anyone wishing to tackle thesubject of river basin management itmay be helpful to have a list ofpossible technical actions belongingto a river basin managementprogramme in order to gauge theirscope. These actions may beclassified according to variouscriteria, the most common systembeing according to their objectives:

(a) Land planning andpreservation actions;

(b) Reclamation or rehabilitationactions;

(c) Protection or mitigationactions;

(d) Conservation actions.

(a) Technical or direct actionsaimed at land planning orpreservation include the following: The establishment and management

of national parks, sanctuaries,reserves and other systemsdesigned to preservebiodiversity, natural landscapes,wildlife and other naturalresources;

The declaration of protectedforest areas or protected areasin general in order to maintainoptimum conditions for thecatchment of both surface watersand groundwaters in a riverbasin;

Zoning and the declaration of

The reclamation through drainageof areas salinized as a result ofirrigation, the application ofcorrective measures and soilwashing;

The stabilization of river bedsin general which have beensubject to the extraction ofaggregate, changes in sedimentload and changes in their banksas a result of river trainingworks;

The restoration of water-qualitylevels in water courses, lakesand marshland, and the re-establishment of the wildlife andplant life inhabiting suchecosystem;

The reclamation of landscapes ingeneral after mining, use of theland for dumping refuse and otheruses affecting the naturalenvironmental conditions.

(c) Technical or direct actionsaimed at protection or mitigationinclude the following: Actions designed to protect man

and man-made constructionsagainst the effects of extremeevents induced by nature or byman himself, for example,measures aimed at controllingfloods, avalanches, landslidesand mud slides, torrents,mountain lagunes, deposits ofwashings and life-threateningsituations in general;

10

Box 9

Technical actions under a riverbasin management programme

limits on the use of resources incertain river basin zones. Forexample, the declaration ofmunicipal river basins enablesland and water use to berestricted for the purpose ofeliminating drinking-watertreatment needs;

The declaration in general oflimits on the use of or access topotential water pollutantsderiving from industry, urbanareas, mining operations,agricultural farms and fishbreeding;

The declaration and control ofthe physical occupation ofwatercourses, floodable terracesand mountain streams, and thelicensing of activities aimed atextracting materials from riverbeds;

The declaration and control ofthe use of land for theconstruction of housing, roadsand any structures liable to beaffected by waters or to causeproblems in their flow;

Restriction on the recreationaluse of land and waters in generalwith a view to avoiding potentialdamage to natural resources.

(b) Technical actions aimed atreclamation or rehabilitationinclude the following: The reclamation of lands which

have suffered degradation as aresult of overutilization by man,normally in the form ofovergrazing or the use of

Actions aimed at protectingnatural resources against thenegative consequences of naturalevents or human actions. Forexample, measures to controlwater and wind erosion, forest-fire control, pest control, etc.;

Protective actions normally have thefollowing objectives:

To increase the resistance ofnatural resources and man-madeconstructions to extreme events;

To reduce or dissipate theviolent force of potentiallydamaging events and thus mitigatetheir effects;

To avoid placing naturalresources and human settlementsin situations of risk;

To alert the population topotential risks, givingsufficient advance warning;

To have in place security andsafety systems per-mitting rapidrecovery in the event of theoccurrence of undesiredsituations.

(d) Technical or direct actionsaimed at conservation comprise allmeasures directly associated withindustrial processing systems

In contrast to theaforementioned actions, which may be

10

Box 9

Technical actions under a riverbasin management programme

unsatisfactory cultivationpractices;

Reforestation, generally afterforest fires, indiscriminate treefelling, the closing of roads,gully erosion or other situationsresponsible for destruction ofthe vegetation cover;

The stabilization of hill slopeswhich have undergone changes ingradient and a process of yearlyundercutting at their basethrough mechanical action or manor water;

The recovery of groundwaterlevels and restoration of theirquality after over-utilization,the elimination of recharge zonesand sources and other situationscaused by man or nature;

The reclamation for agricultureof zones flooded for differentreasons, bearing in mind thatcareful thought should be givento the necessity of drainingnatural or man-made marshlandbecause of the extremely negativepotential effects of doing so;

carried out either in isolation oraccompanied by development measures,conservation measures must be imple-mented in coordination withdevelopment measures. Every use orform of processing resources(agricultural, livestock, forestry,industrial, mining, etc.) must haveits own conservation systems. Theideal situation is that these shouldform part of the production systemin such a way that production andconservation are ensured by the sameprocess. There is no point inproviding a list of actions in thiscase since such a list would be aslong as the list of productionsystems and uses of the naturalresources. It should be pointed out,nevertheless, that the moreconservation measures deployed, theless need there will be forinvestment in the reclamation orrehabilitation of the resources.

Source: Axel Dourojeanni, ECLAC.

This has led to confusion regarding the scope of the term,since authors sometimes claim to be engaged in “river basinmanagement” when what they are actually doing is designingprogrammes for developing natural resources with due regard forthe environment, as when, for example, an agricultural, forestry

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and pastureland management programme is designed, or terracesconstructed for cultivation in hillside areas, or preventivedrainage measures incorporated in an irrigation project.

In other cases the reverse happens with authors saying thatthey are designing “river basin development” programmes when inactual fact they are designing programmes to protect, reclaim orconserve the natural resources of the river basin and itsinhabitants, measures to develop the resources being included aspart of such programm.

This situation has arisen because, in actual practice, themanagement of the resources (management being seen as the meansof preserving, conserving, protecting or reclaiming the resourcesand protecting man) and their development are two halves of thesame whole that can not be separated if one wishes to achievesustained production.

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In other words, using the term “resources development” wouldhave the same meaning if it also implied management actions, andvice versa. Because this is not always the case, it is sometimespreferred to use the term “integrated management” to indicatethat this term includes both management and development.46

In a “rational” system (to use a term dating from the 1970s)of human development in the context of the river basin, wherebyit is upgraded to allow its resources to be safely and reliablyused, the management of all the basin’s natural resources is afactor which should always be taken into account.

The fact that such management has not been taken intoaccount in many river basins, except in isolated cases such asthe Cauca river basin (see box 10), has resulted in seriousinstances of decline in the quality of water and degradation ofvegetation and soils, and has exacerbated the effects of extremenatural phenomena on the population, the physical infrastructureand production systems.

These processes are further aggravated by man, who occupiesthe land without heeding the possible effect of extremephenomena, whether caused by nature or human action. The resultis an increase in the risks to human beings, greater expenditureon the development of natural resources and on their reclamationand protection and also on construction work.

In general, these costs have not been sufficientlyquantified or evaluated, even in unitary terms. It is thereforenot possible to define the overall profitability of river basinmanagement actions, i.e. taking account of the effects of theinteraction of the measures undertaken in a river basin. This“profitability”, in economic and financial terms, is more

46Another term used as a synonym for river basin management is “riverbasin planning”. This is not a correct use, since “planning” is no more than astage preceding the process of upgrading a river basin for human use with aview to planning the use of the land and its resources, but it is usedinterchangeably with “development” and “management”.

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intuition than fact, especially in river basins where there hasbeen no major investment.

In theory, in any process involving the development of thenatural resources of a river basin there should be no doubt as towhether or not to invest in its management for the purposes ofconservation, protection, reclamation or preservation, especiallywhen one bears in mind that, generally speaking, such investmentdoes not call for amounts greater than 10 per cent of theinfrastructural investment in a river basin in order to have amajor impact.

Management is as necessary in maintaining production andreducing risks as sleeping and eating for a worker if he wants toremain active and not end up in hospital. If a person does notinvest in his own maintenance but devotes himself to work alone,he will fall sick and need to undergo a process of“recuperation”, which will end up costing a lot more than if hehad combined productive work with conserving his strength.

Box 10

The working methodology elaborated by the Cauca RegionalAutonomous Corporation for river basin management

The working methodology elaboratedby the Cauca Regional AutonomousCorporation (CVC) for river basinmanagement may be summarized in thefollowing stages or phases:

Phase 1 or the approach to thecommunity. During this phasemechanisms are established for thecontrol and monitoring of thenatural resources with a view toorganizing their use and publicizingstandards to ensure theirconservation. In addition,mechanisms are established to bring

Current approach to river basinadministration

In the light of the studiesperformed, the methodologicaldevelopment of natural resourcesadministration and national,regional and institutionalconditions, a change in approach iscalled for entailing a reformulationof the methodology applied inadministering river basins, togetherwith modification of theadministrative structure and working

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about closer ties with thecommunity, to publicize theactivities to be undertaken jointlywith the community and to gain abetter knowledge of the region.

Phase 2 or formulation of theplan. The main objective to beattained in this phase is to devisea management plan aimed atconserving the renewable naturalresources and developing thecommunity; the first stage informulating the plan is to obtain adetailed analysis of thebiophysical, social and economicfactors, for which specializedtechnical studies are requiredtogether with intensified soil andclimatology programmes andagricultural, livestock and forestrytrials; contracts also have to beassigned in order to obtain basicinformation in geology and socio-economic areas.Phase 3 or execution of the plan andself-management. Analysis of thisphase shows that the process ofexecution tallies with theconditions prevailing at this time,reflecting the broad scope of itsformulation and the indicativeobjectives proposed in the plans.Furthermore, the plans executed weredirected towards several objectiveswith activities planned over a verywide area, with scant involvement ofthe community and water users.

Factors which accelerated the shifttowards the current approach

The economic and financial crisiswhich CVC underwent in 1985 and1986, the promulgation of Law 79 of1986, which in its short period ofoperation left CVC without anyfunctions with respect to regulation

systems with a view to: Planning the administration of

renewable natural resources inriver basins;

Analysing the problems of amultidisciplinary nature to beresolved, while maintaining asystemic approach;

Formulating plans aimed atconcentrating efforts and resourceswhere the greatest impact can beproduced on the system of the majorCauca river basin;

Seeking the coordination ofpublic and private bodies in the co-funding of river basin projects;

Securing the active involvementof the community, aware of its owndevelopment, from the formulationright through to the execution ofriver basin projects.

Objectives of the current Approach

To achieve rational use of theavailable resources through theplanning of activities with the aimof enhancing effectiveness andefficiency;

To establish a hierarchy of areasfor the administration of naturalresources in river basins,permitting investments to be made inorder of importance and of impact onthe system of the major Cauca riverbasin;

To formulate plans for theintegrated manage-ment of naturalresources and production projects,in a participatory form, and tocreate facilities allowing the usersof the resources to be involved inco-funding the projects defined.

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of the use of natural resources, andvarious other factors dictated theadoption of different principles forthe future management of naturalresources and forced a change in theworking strategy employed in riverbasins.

Source: Fernando Alvarez, “Modelo de manejo de cuencas en la CVC”, Proceedings.First International Water Congress, 21-25 September 1993, Medellín Exposition andConvention Centre, Water Corporation.

In addition, because of the effect of river basin managementactions on the discharge of water from the basin, such actionsrepresent an indirect form of watershed management. Thisdistinguishes them from actions aimed at direct administration ofwater (water resources management).47

The success achieved in this task can be evaluated on thebasis of the discharge values of water in terms of quality,quantity, place and frequency, in the same way as the health of apatient can be assessed by analysing his blood and determiningwhether the resulting values fall within a “normal” range for thecategory of patient and his situation.

A river basin is well “managed” if, on average, the runoffwater from it does not contain an excess of sediments in relationto the geological properties of the basin and watercourse and inrelation to the human activities in the river basin, if there isgood filtration and basic flow and if the water is generally of agood quality with “normal” discharge patterns for the type ofbasin in question. Good management is further enhanced if clearareas of risk to human beings are established in the basin andmeasures taken to prevent, mitigate or avoid negative situationswhere their cause is “natural”, as in the case of a flood, or

47In the literature there is some confusion in the Spanish languagebetween the concepts of water resources management and water management, a problemthat does not arise in English. The differences between these two concepts arediscussed in detail in the document Bases Conceptuales para la Formulación de Programasde Manejo de Cuencas Hidrográficas, published by ECLAC, LC/G.1749, Santiago deChile, 17 November 1992.

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man-made, as in the case of breaching of a dyke made out ofmining tailings.

The original definition of river basin management was linked to the indirectmanagement of water. In other words, the management of naturalresources was defined according to its effect on water dischargerather than its effect on the conservation of the resources.Thus, the original definition holds that managing a river basinis “the art and science of managing the natural resources of ariver basin in order to control the discharge of the water interms of quality, quantity, location and time of occurrence”.

This definition formulated by Dr. Robert E. Dils of ColoradoState University in 1964, is highly appropriate when applied tothe Rocky Mountains in the United States, where there are riverbasins mainly used for the catchment of water for agriculturaland urban purposes. These are sparsely inhabited river basinswith a high precipitation level and extensive areas of nationaland private forestland such that the management of these basinsis studied in forestry schools. This definition is applicable,first and foremost, to sparsely inhabited river basins whose mainpurpose is to capture water for urban use (municipal river basins) orfor other uses.

They are known as “catchment areas”. Some of these principlesalso apply to river basins located in the southern part of SouthAmerica and some high-mountain regions.

In inhabited river basins where there is extensive use ofland for agricultural and fisheries production, as in the highAndes region of Bolivia, Peru, Ecuador, Colombia and Venezuelaand almost the whole of Central America and Mexico, thisdefinition does not suffice. Moreover, there has been a longtradition of the management of such inhabited river basins,dating back to pre-Inca times, which, while not yet fullyrecovered is nevertheless still alive and represents an areacalling for research to document the current experience.

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The original meaning of the term “river basin management” ascoined in the United States derives from the forestry schoolsowing to the fact that the catchment basins are mainly used forthe purposes of forestry and pastureland. Originally, therefore,the term was used in the realm of hydrology and forestry. As amatter of fact, one of the first experimental river basins wasthat in Coweeta, established in 1934 in the Appalachian Mountainsin the United States; here, the basic principles of river basinmanagement were developed for this country, where they had notpreviously existed.

For South America, Central America and the Caribbean, thepreferred definition of river basin management is that formulatedby the College of Engineers of Peru, whereby river basinmanagement is defined as the application of principles andmethods for the rational and integrated use of the naturalresources of the river basin, essentially water, soil, vegetationand wildlife, aimed at achieving optimal and sustained productionof those resources with minimum damage to the environment for thebenefit of the inhabitants of the river basin and the communitieslinked to it. An indispensable element of river basin managementis the active participation of the local population in dulyorganized form, with the coordinated support of the relevantpublic and private institutions.48

As a result of the development of the issues surroundingriver basin management, various technical manuals are beingprepared to provide guidance for both the design and theformulation of projects and their evaluation. FAO has, generallyspeaking, produced some valuable technical documents in thisarea. For its part, ECLAC has developed management procedures forproject formulation (see box 11) and the Inter-AmericanDevelopment Bank is embarking on the preparation of a manualtogether with ECLAC for the economic evaluation of projects aimedat river basin management.

48College of Engineers of Peru, 1er Seminario Nacional de Manejo de Cuencas, 5-9July 1993, Lima, Peru.

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In addition, new training programmes are being devised inthis area, not only at the postgraduate level as in the case ofCATIE in Costa Rica, the University of the Andes, CIDIAT inVenezuela and the La Molina Agricultural University, Peru, butalso with respect to regular courses. A special two-month coursefor Latin Americans is even being given in Italy (see box 12).

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Box 11

Systematization of river basin management actions: tentative sequence1. Gather information on the river basin to be

managed and its basic characteristics. Preparea bibliography, physically traverse ariver basin using various means oftransport depending on the distancesinvolved, collate existing maps,photographs and reports. The purpose ofthis first stage is to form as precisea picture as possible of the conditionsof the locality, its history, theindividuals involved in the activitiesbeing undertaken there, the state ofthe communication routes, and otherfactors.

2. Identify the agents concerned with themanagement and development of the riverbasin, whether they be local to the area oroutsiders, who have some influence in therelevant fields. It is helpful to definea model to be able to input eachagent’s data in an orderly fashion inthe interests of easy access later. Inthe subsequent stages one should notlose sight of the connection betweenthe agents and the problems,objectives, obstacles, solutions andstrategies to be applied in order toachieve those solutions.

3. Enumerate and classify the direct ortechnical and indirect or management actions—past, present and planned—in the river basinknown to and described by the different agentsinterviewed. Situate the technical ordirect actions geographically on mapsof the river basin and on listsindicating whether the actionsconcerned involve studies, projects,the execution of works, maintenance ofstructures or resource management andconservation. Also record the indirect

8.Then comes preparation of inventories,evaluations and analyses aimed at determiningthe feasibility of the objectives established inthe previous stage. In the field detailedchecks are made of the problems andthe scope for resolving them. It isunderstood that achieving theobjectives entails both direct ortechnical actions and indirect ormanagement actions. The purpose of thetargeted evaluations and analyses isto identify the obstacles which willneed to be overcome in order toachieve the objectives and the scopefor doing so. This task may be carriedout by applying the techniques alreadyoutlined. The concept of “evaluation”,which means comparing a situation witha reference standard, should not beconfused, however, with that of“analysis”, which explains why the ob-served situation departs from thestandard or model. The analysis is thebasis for deciding what measures(better known as solutions) should betaken in the river basin.

9.All the obstacles (or restrictions) must becodified and described on forms similar to thoseused for describing the problem. Thedifference between a problem and anobstacle (or restriction) is that thelatter is defined in relation to aknown objective. Once identified, eachobstacle must be related to any agentor agents who caused it, to thepersons or agencies responsible forovercoming it, to those who will haveto assume the costs of the correctivemeasures and to those who will have toexecute them. Systematic work toidentify obstacles is the basis for

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or management actions in a systematicfashion. Prepare tables showing therelationships between each action andthe others, the agencies involved, thecredit lines in use, the investmentsmade, the training provided to usersand other data which, taken together,will provide a complete picture of whatis being done on the river basin interms of resource management anddevelopment.

4. Collect each agent’s opinions on theexecution of river basin management actionsand on his own activities in developing the riverbasin’s resources. This will reveal whetherthe individuals concerned are in favourof such actions, neutral towards themor opposed to them, together with theirpersonal or institutional interests inrelation to the areas possibly to bepromoted. It is also helpful to obtaininformation on the official functionsof the various agencies concerned withthe river basin and any arrangementsalready in place for coordinating theiractivities. It should be mentioned thatthe criteria employed by the agentscondition their view of the problems,hence the ideal model with which theycompare real situations.

5. List and catalogue all the river basinmanagement problems perceived by the agents.Determine their frequency, location andthe conditions in which they occur. Inthis phase it should be borne in mindthat what might constitute a problemfor one agent (such as the farmerswhose only irrigation canal is pollutedby pathogenic germs or chemicalproducts) is not necessarily a problemfor the others (such as the hospital orindustry which is responsible forpolluting the canal with its refuse orwaste). Classify the problems,separating those relating to technical

generating solutions to overcome them.

10. The next step is to formulate proposals oralternative solutions for each of the obstaclesidentified, to classify them and to rank themhierarchically. Regarding the technicalactions, the following procedureshould be followed:

(a) Compile a manual setting out allthe relevant practices in dulycodified form. In order to do so, itwill be necessary to have a codifiedlist of land treatment measures, whichfor the most part comprise measuresrelating to vegetation and cultivationtechniques and to the management ofwatercourses (watershed structuralmeasures), which are predominantlymechanical and structural incharacter.

(b) Prepare a list of plannedwatershed structural measures, eachone being marked on a map showing itsgeographical location. In view of thecomplexity of the problem, it will benecessary to make a separatecalculation of the cost of eachstructural measure and its effect ondischarge control, water quality andsediment retention. Such measures willinclude torrent regulation, floodcontrol, water treatment, bankstabilization, control of landslidesand gullies, and the like.

(c) Draw up a table identifying thepractices recommended for each type ofland use, its reference code in thedescriptive manual, the frequency ofits application, the area of landcovered in hectares and its unit cost.This table is essential forcalculating the cost of executing therecommended technical solutions andgaining familiarity with the sitewhere they are to be applied, theusers of the land and other data(d) Draw up a list of indirect or

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and physical factors from those relatedto management issues.

6. Once a list has been drawn up of problemsindicated by the agents, describe each problemin detail and the relationship between theproblems and between each problem and theagents. In performing this task it isadvisable to collect the informationtogether on forms designed to takeaccount of the specific types ofproblems identified during interviews.The direct or technical problems mustbe marked on one or more maps of theriver basin, problems common to all theusers (generally those relating to thewatercourses or channels) beingdistinguished from those affecting eachlandowner or tenant individually(usually problems relating to plots ofland on hillsides, terraces or levelground). In the case of problems of anindirect nature or concerningmanagement, the institutionsresponsible for creating or resolvingthem should be noted.

7. The next step is to convert the list ofproblems (situations regarding which the agentshave expressed differences of position) intoobjectives clearly established by the agentsthemselves. There are two complementaryways of achieving this: either to inferthe objectives on the basis of the listof problems or else to do so on thebasis of quality-of-life models. Oncethe list of objectives has beenestablished, a further one is preparedon the basis of the points made by theagents themselves. The two lists arethen compared with one another by theadvisers and users together. The usersare normally more inclined to expresswhat they do not want withoutnecessarily having a clear idea of whatthey do want. The final list ofobjectives has to be ordered according

management activities necessary forimplementation of the recommendedmeasures. It should be borne in mindthat each of these activitiespresupposes a set of previous actions,such as training of the users,awarding of credits, organization ofsupport services, coordination ofinstitutions, and so forth, and thatthis represents a major budgetary itemfor the river basin managementprogramme or project.

11. The next step is to evaluate the benefitsyielded both as a result of the combined effectof the envisaged management actions(medium- or long-term target, since atleast 10 years are required toachieve any tangible results in termsof the quality or quantity of waterdischarge) and through each of therecommended practices, mostparticularly the land treatmentmeasures. In order to evaluatethe necessary investment, it isnecessary to calculate the unit costsof each structural measure. Thecalculation of benefits must takeaccount of two factors:(a) Benefits yielded in the specificsite of applica-tion, for example,when pastureland is improved, terracesconstructed or reforestation carriedout, the resulting increase in outputor soil conservation takes place onthat same site.(b) The benefits yielded for watersdownstream from the site ofapplication of the structural measure,essentially as a result of lower sedi-ment yield, increased basic flow,improved water quality, and so forth.

The economic calculations can only bemade on the basis of systematic andwell-classified information con-cerningeach structural measure. Given that a

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to priorities, particular importancebeing assigned to collective targets.A prioritized list of objectives is the basis forperforming targeted studies and analyses on theriver basin in an effective manner, saving timeand resources.

whole array of factors are involved inriver basin management, it is notpossible to prepare budgets for largeareas without working on the basis ofunit and combined costs and effects.This means, for example, that a bankthat provides loans for river basinmanagement must encourage thepreparation of practical manuals, asindicated in this study, as well as theestimation of the unit and combinedcosts and effects of the structuralmeasures.

Source: Axel Dourojeanni, 1992.

Box 12

Typical programme of a course on river basin management basedon the

mountain watershed protection approach

PROGRAMME

1. The river basin as anecological, social,

political and economic unit Principles for integratedmanagement;

Territorial planning and socio-economic development;

River basin planning methods.

2. Profiling of the river basin Analysis of physical andbiological factors;

Evaluation of mountainecosystems;

Use of satellite images inexploring territorial resources;

Examination of the informationrequired for the study andplanning of mountain watersheds;

Planning of agriculture andlivestock farming, and economicdevelopment;

Agricultural practices for thecontrol of surface erosion.

4. Investment projects and intervention techniques

Principal interventiontechniques: structural and non-structural measures;

Plans for the utilization ofwater resources systems in aridand semi-arid zones;

Torrent control andconstruction works for theregulation of river courses;

Stabilization of hillsides andlandslide control;

Support infrastructure foragricultural and forestry

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Techniques for evaluating waterresources;

The water cycle; hydrologicalmodels: calibration andsimulation.

3. Production and conservationsystems

Analysis of erosion processes;effects of torrential flooding;

Theagriculture/forestry/pasturelandsystem;

Multiple use of woodlands;forestry infra-structure;

Management of woodlands; forestryinfrastructure;

Tropical forest cultivation;

development; Evaluation of environmentalimpact.

5. Organization and managementfor the

development of river basins The importance of managementin socio-economic development;

Project for the organizationof techniques to be employed inriver basin management;

Strategies for communityinvolvement and economic andemployment incentives;

Cooperation as a system ofsocial organization directedtowards development.

Source:

Instituto Italo Latino Americano (IILA), Trento AutonomousProvince, Italian Hydronomy Association, 5th International Courseon “River Basin Development and Management”, Trento and Monselice,Italy, 27 September 5 November 1993, Course sponsored by theGeneral Directorate for Development Cooperation under the ItalianMinistry of Foreign Affairs; Course secretariat: Instituto ItaloLatino Americano (IILA), Servicio para la Cooperación, PiazzaGuglielmo Marconi, 26/b, 00144 ROMA EUR (Italy), Telex: 614391IILA I, Cable: LAI ROMA, Telefax: +39/6/5914923, Telephone:+39/6/5909505 - 5909475 - 5909477.

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4. Scope of technical actions in the context of wateradministration

The actions referred to here relate essentially to the operationand maintenance of multi-purpose hydraulic works. Theadministration of river basin waters is aimed at distributing thewater among a variety of users, regulating water discharge,controlling its quality and undertaking the combined managementof surface waters and groundwaters, among other tasks.

The purpose of water administration is to reconcile supply withdemand in terms of quantity, quality, place and time. Therelevant actions include registration of users, regulation ofwater supply and distribution, maintenance of supply and demandrecords, planning measures to meet future demand, forecastingwater supply, operating reservoirs, carrying out water-treatmentoperations, charging for water supply services, and othermanagement tasks associated with multiple water use.

The administration of water for the purposes of multiple useis the basis of all river basin management activities. We havenot elaborated on this point in this paper because there is awealth of readily available literature on the subject.

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Part III

Managerial aspects of watershedmanagement

1. Functions of river basin management agencies

In several countries of Latin America, extensive debate is takingplace on the establishment of river basin authorities, theapproach to be adopted in bringing the authorities establishedinto operation or modification of the functions of existing riverbasin authorities, for example, through the incorporation ofenvironmental management activities. Brazil, Chile, Colombia,Guatemala, Peru and Venezuela are among the countries where thesematters are being debated at the official level.

The aim of the present chapter is to set out some of themotivations and factors which affect the creation of a specifictype of river basin management agency.

The task of designing and establishing a river basin agencyis a complex and long-term exercise. Various procedures have beenfollowed in the region.

The simplest procedure has been to establish them by means ofa law or decree without any extensive preliminary studies.Thereupon, a minimum budget has been allocated and the

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respective managers have been appointed. In general, each onehas been allowed to decide how to discharge his functions,where to obtain greater funds, and how to involve users andgradually form an organization.

In other cases, consultancy firms have been engaged for thepurpose of submitting alternative solutions on the basis of areference framework with a view to creating a managementagency, as in the case of the Bío-Bío river basin in Chile(Water Resources Management Project, Bío-Bío River BasinCorporation).49

A further common procedure for establishing such agencies hasbeen to seek technical assistance from countries which have avery long tradition of river basin authorities, such as Franceor Spain. For example, Brazil has partly followed that courseof action, generally in conjunction with the otheralternatives (as in the case of the Doce river).

The fact is that there is still no consensus, or guide oraccumulated experience in the region for countries to follow whenestablishing river basin management agencies. Countries are thusengaging in extensive debates on the advisability of setting upsuch organizations, the appropriateness of their sources offinancing, appointment of the authorities and other matters.

A. Motivations and justification for the establishment of riverbasin management agencies

The term river basin, formerly the almost exclusive preserve ofhydrologists and earth scientists such as geologists andgeographers, has now been popularized to the point that even townmayors are at last concerning themselves with the river basinsfrom where water is supplied and from which serious risks of

49Republic of Chile, Ministry of Public Works, Office of Water Resources,Design and Planning Department, Water Resources Management Project, Bío-Bío River BasinCorporation, 1994.

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flooding may possibly arise. There are several reasons for thisinterest, the main ones being as follows:

The primary cause is the increasing competition for the use of the waterresource, competition that can be avoided only by reconcilingthe interests of users by means of integrated management ofthe resources in each river basin or water system. Moreover,this competition is no longer solely over the amount of water,as it was for many years, but also over the quality of theresource, its suitability and location. The need to preserve,protect and generally conserve the environment is currentlyone of the most important reasons for regarding river basinsas a geographical unit of management.

In this primary regard, a further factor of competition to beincluded is increased settlement of the land by man. Thiscompetition, together with poverty, ignorance and lack ofproperly applied plans for zoning land use, has driven humanpopulations to occupy zones liable to flooding and landslidesand to establish large cities in zones where water is in shortsupply. In addition, lack of organization is causing humanbeings to destroy water catchment basins, overexploitgroundwater resources and eliminate sources of replenishment,to use river basins as rubbish dumps, and the like.

The production and service sectors, which act in isolation,such as the public health sector, traditionally responsiblefor monitoring problems of contamination, have been left waybehind in their powers, resources and operating capacity todischarge, say, their water quality control functions withoutassistance. Each sector must of necessity work in coordination with othersectors in each river basin if their management is to be successful (see box13).

A further major factor arguing in favour of integratedmanagement of river basins and water resources is the growingvariety of water users and their increased negotiating power. For example,the advent of fishery farms in rivers, lakes and estuaries(“water culture”) has brought with it an urgent need for the

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management of catchment basements. The same applies to riverbasins in which dams have been constructed and which receiveexcessive amounts of sediment, requiring the enterprises incharge of managing the dams to implement erosion-controlplans.

The increasingly serious effects of extreme natural phenomena such asdroughts, floods and major landslides has obliged the usersectors, which previously worked in isolation, to join forcesin river basins in order to implement regulation works ofbenefit to them as a whole, the costs being shared inproportion to the benefits received by each party. Thisattitude, however, is only just beginning to catch on in riverbasins because of the weakness of some of the user sectors,either through lack of organization or on account of theirmeagre economic power.

Paradoxically, because of the lack of strong river basinauthorities, solutions are normally found to problems concerning waterand the environment in general only when major conflicts arise between userenterprises possessing equal negotiating power. Concern with theintegrated management of major river basins, especiallyregarding pollution control and the management of catchmentbasins, is virtually non-existent in regions where there isonly one major user (for example, a mining company) or wherethere are problems due to the existence of clandestine minessuch as ore-extraction mines which use mercury, cocamanufacturers who employ a range of chemicals and acids, orsimply migrant farmers working in hilly areas where they felland burn timber.

Box 13

Signing of River Basin Protection AgreementThe health minister, Juan LuisLondoño, has signed an inter-institutional management agreementwhereby the 1990s will be the Decadeof the River Basin in Colombia uponthe celebration of national water

The plans that are to beimplementewithin this programme willbe financed by national, provincialand municipal funds and also throughdevelopment taxes, domestic andexternal loans, donations and

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day. The treaty has been signed aspart of the closing ceremony of theFirst Water Culture Event, held inBogotá, with the participation ofexperts from the Ministries ofAgriculture, Development and Health,the Colombian Institute ofHydrology, Meteorology and LandImprovement (HIMAT) and the NationalPlanning Office.

The management scheme for thedecade aims to bring about a changein the use of water that will makeit possible to raise Colombians’standard of living, since the poorquality of water is one of the maincauses of serious diseases.

It is aimed to involve allpublic and private domains in thistask of water conservation and bringabout an awareness of the integratedmanagement of the country’s riverbasins.

contributions from enterprises.

The planned objectives includethe possibility of aligning economicand social progress with theenvironmental and sanitary standardsof river basins and bring abouttheir inclusion as a comprehensiveplanning framework within theterritorial jurisdiction served bythe scheme.

Further objectives are topromote the involvement of citymayors in the formulation anddevelopment of the river basinmanagement plan and also toestablish mechanisms for communityparticipation in supervisoryprocesses and educationalprogrammes.

Source:

El Nuevo Siglo.

In addition to these factors, which have a direct effect ofincreasing awareness in each country of the need for integratedmanagement of river basins and water, there are other factorsintroduced by “intervening” actors, whether national orinternational, which exert a degree of influence on the actorswho inhabit the river basin without actually belonging to theirnumber. These factors include:

The inputs provided by international bodies and bilateral assistance agencies,whose activities have a bearing on river basin issues, havecontributed directly or indirectly to raising awareness of theneed for river basin management systems. For instance, theUnited Nations, mainly through ECLAC, FAO, the WorldMeteorological Association (WMO), the United NationsEducational, Scientific and Cultural Organization (UNESCO) andthe World Health Organization (WHO), has been engaged in a

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wide range of activities which have contributed to ourunderstanding of the subject of river basins.50 TheOrganization of American States (OAS) has also been active inthis area through its Department of Regional Development andthe Environment.51 France, Spain and the United States havebeen particularly active in promoting integrated river basinmanagement.

International agreements on the environment in general and water inparticular have also fostered an approach based on riverbasins. Examples include the agreements of the United NationsConference on Water distributed as the Mar del Plata ActionPlan, the International Conference on Water held in Dublin,Programme 21, the agreements of the Miami meeting,52 and manyother such agreements.

International agreements on the management of shared river basins havealso contributed to the creation of management authorities forthese areas. The Cuenca del Plata Treaty (1969) is one of thebest known in this regard. This category also includes thebilateral agreements with countries such as France, Spain andthe United States, whereby they have transferred theirexperience in integrated river basin management.

In addition to the above, there are initiatives aimed at publicinformation, training and the promotion of cooperation in the integratedmanagement of river basins undertaken by universities, non-governmental organizations, vocational institutions, higherschools of administration and numerous other centres andprivate ventures.

50United Nations, Integrated River Basin Development, New York, 1970, Revisededition, Sales No. 70.ii.A.4; and Guillermo Cano, Administrative organization systemsfor integrated river basin development, Doc. E/CN.12/503, United Nations, ECLAC,Santiago de Chile.

51Secretariat of the Organization of American States, Catalogue of projectsexecuted and being executed in the area of environmental management and protection, Departmentof Regional Development, Washington, D.C., August 1992.

52Inter-American dialogue on water administration, South Florida WaterManagement District, Miami, Florida, United States, 1993.

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The river basin is certainly not the only geographical unitto be taken into account in this process, nor is there very muchscope for “managing” resources in some very arid or flat regions.However, it is a territory which offers advantages, including thefollowing:

The possibility of organizing the population—in terms ofenvironmental issues—in relation to a resource (water) and ashared territory (the river basin) and of overcoming thebarrier imposed by political and administrative limits, thusfacilitating communications between units.

Greater scope for systematizing the implementation of actionswithin a space where the interests of the actors can bereconciled with regard to the use of the river basin, multiplewater use and the control of adverse natural phenomena.

The possibility of evaluating the results achieved in themanagement of natural resources through their effect on waterdischarge. In other words, by using the river basin as a basisfor operations it is possible to gauge to some extent whetherthe desired “environmental sustainability” is being attained.

Despite all these arguments in favour of tackling thesubject of river basins, it has to be acknowledged that thetangible results obtained in the countries of Latin America inthe practical application of this principle are verydisappointing.

B. Functions and responsibilities of river basin authorities

(i) What functions should a river basin authority have?

The direction or management of actions directed towards varioustypes of objective within the framework of a river basin is atask performed by authorities which go by various titles,including “corporations”, “agencies”, “associations” and“committees” (see box 14). The scope of their functions depends

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on the objectives assigned to them and can thus includeintegrated development and management, management of all thenatural resources or management of water alone. Regardless of theauthority’s level of coverage, three fundamental dimensions mustbe dealt with, namely the environmental, social and economicdimensions.

Accordingly, the philosophy determining the functions ofthese authorities should be based, inter alia, on the following:

Water- and environmentally-based criteria. In France, forexample, “management of the aquatic environment has beendesigned on the scale of a single unit, the river, andestablishes the principle of respect for the environment andits physical and ecological functioning”.

This philosophy should also be based on social criteria withthe aim of ensuring that any negotiations encouraged betweenthe actors and users of the river basin serve the interests ofequity, the minimization of conflict and the safety of itsinhabitants.

At the same time, economic growth should be stimulated throughbetter use of the natural resources of the basin and alsothrough multiple water use harmonized with the goals ofindustrial production.

Box 14

What is the Cauca Regional Autonomous CorporationThe Cauca Regional AutonomousCorporation (CVC) is a nationalpublic institution withadministrative autonomy and its ownfinancing, established by Decree Law3110 of 1954, which has beenassigned the mission of guiding andpromoting the social and economic

the imposition of toll charges, thelevying of development taxes andcharging of fees for services, andproperty required for theachievement of its objectives isdeclared as being of public utility.

The progress and success

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develop-ment of the area within itsjurisdiction.

As a public and autonomousinstitution, CVC acts through itslegal representatives (the Board ofDirectors and Director General),possesses its own property, issubject to fiscal supervisioncarried out by the TreasuryInspector’s Office of the Republicand requires the approval of theNational Council of Economic Policyin order to obtain loans, whetherinternally or from abroad. Inaddition, being an integral part ofthe governmental machinery, it actsimplicitly carry the exercise ofauthority; it enjoys prerogatives inrelation to the use of public high-ways

achieved by CVC are essentially dueto the determination and directionof individuals who know the regionalsituation and are part of it, andwho also undertake theirpredominantly technical workindependently of political vagariesand influences.

Since its creation in 1954, CVChas contributed actively to regionaldevelopment through the increase andsupply of electrical power, theimprovement of lands for use inindustrial-scale intensiveagriculture and the administrationand conservation of the existingnatural resources in itsjurisdictional area.

Source:

Fernando Alvarez, “Modelo de manejo de cuencas en la CVC”, Proceedings.First International Water Congress, 21-25 September 1993, Medellín Exposition andConvention Centre, Water Corporation.

In general, the tasks of a river basin management agency,whatever its organizational structure, should be to ensure theprovision of services to the basin’s users and also to guaranteeconformity with the agreements (controls) entered into by thelatter for the benefit of all. Such services include, forexample, those relating to credit facilities, training,education, health, loans and funding, technical assistance,environmental protection, hydrological information, monitoring,planning, coordination of activities, design and operation ofwarning and civil defence systems, and so forth (see table 4).

The public authorities responsible for water management havea straightforward approach to initiating organizational measures.They simply designate a local official for each river basin ormajor town or city within it as having responsibility forcollecting all the available information on the studies performedon the river basin and the maps, photographs, plans, films and

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any other available documents in such a way that the public cangain access to the information. This task is facilitated by theconstruction and display of scale models. The aim is to graduallyincrease the public’s awareness of issues relating to the waterand river basin on which their lives depend. This is a task whichhas to be accomplished with the assistance of the river basinusers.

The first task of such organization may simply be tofacilitate the coordination of activities on the river basin inrelation to water management without seeking to modify thecompetences of each authority. Clearly it is important that thiscoordination exercise should make it possible to identify whichareas of work have no responsible official in charge of theirexecution. This can be achieved by means of double-entry forms onwhich the actors are listed vertically and the technical ordirect and managerial or indirect actions horizontally (seetables 2, 3 and 4). For example, urban sewerage tasks seldom haveofficially assigned responsible officials. It is also useful forascertaining whether the authorities responsible for a particularaction are genuinely qualified and equipped to discharge theirfunctions.

Without any need, therefore, for a large budget or for achange in the functions of existing authorities, it is possibleto significantly improve the involvement of users and the publicat large in water management. Increasing public awareness of thevalue of water is essential for any future work. It makes itpossible to tackle conflict situations due to the shortage orexcess of supply of water or problems of contamination and, inparticular, lays the foundations for establishing a river basinauthority.

Table 4. Indirect actions associated with management of a riverbasin

Agents Beneficiaries

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State Non-governmentalorganizations

Internationalorganizati

Others

Enterprises

Farmers Localorganizations

Others

Administration of resources and Access to credits to training Application of public and private Access to education Mobilization of sources of funding Access to funding Auditing at the national and other Access to information Training of technical and Access to inputs Technological development Access to markets Decentralization and Access to rural extension Education and advanced research Access to the results of advanced Framing of international public Access to marketing services Framing of national public policy Access to social services Pure and applied research Access to specialized technical Legislation and public regulatory Access to technologies Economic management Access to the use of natural Supervision of conformity to Involvement in the framing of Organization of users Involvement in the formulation of Organization and rationalization in Involvement in social organization Awarding of credit lines Involvement in sectoral and Awarding of incentives Involvement in local management Provision of social services to the Involvement in the preparation of Provision of specialized technical Receipt of logistical support Awarding of permits for the use of Receipt of incentives Sectoral and multisectoral planning Any other action to ensure the Preparation of budgets activities Institutional reform Monitoring of the misuse of water Operational relations between basin Any other action to ensure the

execution of direct Ctivities Source:

Axel Dourojeanni, Procedimientos de gestión para el desarrollo sustenable (aplicados amicroregiones y cuencas), Latin American and Caribbean Institute forEconomic and Social Planning (ILPES), Document 89/05/Rev.1, SerieEnsayos, Santiago de Chile, October 1991.

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(ii) What decisions should be taken by a river basin authority?

What type of decision should be taken by a participatory“management” responsible for the integrated management of wateror other natural resources in a river basin?

Decisions in principle as to how national policies should beadapted to the policy applicable to water management with aview to its multiple use on the river basin and the use ofother resources.

Decisions on the instruments (economic, financial,information, educational, and so forth) to be used in order toimplement strategies for the management of water and otherresources.

Decisions to resolve conflicts between users (past, presentand future) arising from competition for water use(arbitration);

Decisions on the awarding of authorizations for land and wateruse with a view to minimizing natural hazards (location offlooding zones, management of municipal watersheds, locationof recharge zones, etc.) and preserving optimal water quality;

Decisions on the system for funding activities of commoninterest and forms of charging costs and assigning profits;

Decisions on arrangements for coordination with national,regional and local institutions with a view to the division ofresponsibilities, tasks and budgets;

Decisions on current and future investments in the managementof water supply and monitoring.

(iii) What type of proposals should be made by a river basin authority?

What type of proposals should be made (responses given) by thesecretariat of a river basin authority to the committee?

Proposals for ideas on water-use, with reasons for theirchoice;

Design of requested projects;

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Proposals for inter-institutional coordination systems; Proposals for ideas on funding, with reasons for their

choice; Proposals for investment ideas, with reasons for their

choice; Drafting of proposals for tenders for contracts; Revision of investment proposals from each user sector; Revision of environmental impact studies performed by other

bodies and undertaking of its own studies; Proposals for projects and options of political and social

interest; Proposals for zones for the protection of biodiversity; Proposals for laws and regulations designed to improve

water-quality monitoring and generally improve thesupervision of collective decisions and theirimplementation.

C. Roles of river basin authorities

(i) Authorization of water use as a part of river basin management

The authorization of water use is a basic tool in the managementof water resources. The awarding of authorizations to use waterin the shape of permits, licences and other forms of theassignment of legal capacity is based on technical, legal andeconomic considerations. Recently, even greater stress has beenplaced on such authorizations as a means of creating a “watermarket” (see the role of river basin authorities in the watermarket, pages 74 - 80).

Systems for the awarding of water rights or authorizations for the use ofwater are of topical importance irrespective of the existence of water marketssince they constitute a source of information and a means of recording watertransactions, regardless of the mechanism whereby the transaction is performed.

The criteria for the awarding of water rights must beexamined by each river basin authority in charge of theadministration of multiple water use so that the rights are

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awarded with due regard for the environmental, technical, legaland economic conditions of the river basins. Conejo53 defines andanalyses various criteria, listed below, which need to befulfilled for the awarding of water rights.

In principle, he maintains that in order to assign waterrights it is necessary to have available hydrological studies ofthe river basin, which, at the very least, indicate the availablequantity of water for each section of the watercourse, thequality of the water and its self-purification capacity, togetherwith current and forecast demand. Obviously, it is necessary tohave an up-to-date register of current users and of water-useauthorizations already awarded but not yet in use. On the basisof this information, the authority administering the river basinwater can establish, in conjunction with the users, clear targetsand limits with regard to water use (maximum extraction orexploitation rates, pollutant limits and loads, etc.).

Clear targets make it possible to carry out a process ofmonitoring according to objectives. The basic informationpresupposes the availability of data on the following: waterbalance; waters upstream and downstream from the section studiedin both quantitative and qualitative terms; the volumes of waterable to be withdrawn or pumped without permits (if a significantproportion of the whole volume); the maximum flow derivable froma particular watercourse or aquifer, the maximum flow forconsumptive use; the minimum flow to be maintained in thewatercourse; fluctuations recorded in the flows; flows whose ratecan be controlled by means of the available hydraulic structures;and the concentrations and loads of dumped pollutants and maximumpermissible concentration of pollutants and their type. Up-to-date information of this kind enables water rights to beassigned, where applicable, and charges to be imposed for the useof water or water rights taking account of all factors: location,quantity, quality and time of availability before and after thedesignated use of the resource.

53João Gilberto Lotufo Conejo, “A outorga de usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de AdministraçãoPública, April/June 1993, Volume 27.

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The award of water-use authorizations must take account ofbasic environmental requirements, including the requirements fortransporting and dissolving the pollutant load, where applicable.It is reasonable to assume that the environmental minimum iscalculated as being equivalent to the minimum flow in criticallow-water conditions on the river basin prior to extraction. Theminimum flow has to be increased if there is pollution.

As far as water quality is concerned, the basic requirementis to have access to data on the concentration of oxygendissolved in the water body. Aerobic conditions need to bemaintained in order to preserve aquatic life and preventeutrophication.

The above-mentioned author considers that in assigningwater-use rights, the following conditions have to be specifiedat the time of assignment:

The limit on the quantity of water which may be withdrawn andconsumed, this being subject to seasonal restrictions andrestrictions relating to overland flow and groundwater runoff;

Limit on the total quantity withdrawn or consumed per unit of time (day, week, month, year);

Limit on the supply of quantities of water returned to thewatercourse (industrial and household effluent, runoff water)and on maximum concentrations of each pollutant and totalpollutant loads, these being subject to seasonal restrictionsand restrictions relating to runoff;

Water-quality specifications (concentration and load) for eachtype of effluent have to be analysed systematically for eachuser under conditions predetermined by the agencyadministrating the river basin waters and the resultsperiodically sent to that agency;

An important point is to determine the periods of validity ofthe water-use rights awarded, where this is specified by thelaw. It is also necessary to establish procedures for therenewal of such periods and the relevant requirements to bemet;

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With or without assignment time-limits (indefinite andabsolute assignment, as established in some laws and draftlegislation), the legal, technical and environmentalconditions have to be specified whereby the right of use maybe transferred to third parties. This is essential forbuilding up a water market.

The amount to be paid by the holder of the water right alsohas to be specified, both with regard to the fee charged for theright itself and the rate charged for the service providedthrough the river basin authority. The aforementioned data, suchas the quantity of water withdrawn and returned, the time andplace at which the flow is changed, the pollutant load and thetime of the year and runoff season are essential for establishingthe charges for water use.

The types of data necessary for monitoring water assignmentsare set out in a series of tables for the purposes ofillustration (see tables 5-8).

Only a stable entity, furnished with adequate resources andpossessing the capacity to coordinate actions throughout theriver basin, will be capable of gathering and processing suchinformation, even when the actual measurements are carried out bya variety of institutions.

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Table 5. Water pollution—trends and targets

Dumped loads—share—level of treatmentCurrent—985 Future—2010 Target—1995 Target—20101 2 3 1 2 3 1 2 3 1 2 3

Urban 76 50 5 280 72 0 34 38 80 56 62 80Sugar—alcohol 13 8 99 13 3 99 13 15 99 13 14 99

Other industries 64 42 70 97 25 96 42 47 80 21 23 90Total 153 100 90 390 100 85 89 100 95 90 100 95

Source: João Gilberto Lotufo Conejo, “A outorga de usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de Administração Pública,April/June 1993, Volume 27.

Note: (1) Organic load dumped in tonnes of raw refuse per day; (2) percentagecontributed by the sector to the total dumped load; and (3) efficiency of thesector’s waste treatment.

Table 6. Captured streamflow, tariffs and income

User sectorStreamflowcaptured in

Tariff(US$/m3)

Annual income(millions of

Urban 9.1 0.02 5.7Industrial 20.4 0.03 19.3Irrigation 6.1 0.03 5.8Export (São

Paulo)31.0 0.02 19.5

Total 66.6 - 50.3Source: João Gilberto Lotufo Conejo, “A outorga da usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de Administração Pública,April/June 1993, Volume 27.

Table 7. Pollutant loads, tariffs and income

User sectorLoad dumped in1985 (tonnes ofraw refuse per

day)

Tariff (US$ per1 kilogram ofraw refuse)

Annual income(millions of

US$)

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Urban 76 0.2 5.5Industrial 77 0.4 11.2

Total 153 - 16.7Source: João Gilberto Lotufo Conejo, “A outorga de usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de Administração Pública,April/June 1993, Volume 27.

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Table 8. Income generated and economic impact of the sector

Usersector

Annual income generated(millions of US$)

Economicindicator

s(10 US$)

Economicimpact(%)

Withdrawn Pollution TotalUrban 5.7 5.5 11.2 10,8281 0.10

Industrial

19.3 11.2 30.5 1,0982 0.20

Irrigation

5.8 0 5.8 6003 0.97

Export(São Paul

o)19.5 0 19.5 - -

Total 50.3 16.7 67.0 - -Source: João Gilberto Lotufo Conejo, “A outorga de usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de Administração Pública,April/June 1993, Volume 27.

Note: Economic impact = total income/economic indicator x 100. (1) annualcommercial income; (2) value of annual industrial output; and (3) annualincome from the agriculture and livestock sector.

All this information relating to the river basin as a whole,sections of the basin and each individual user is time-consumingand costly to obtain since it calls for quantitative andqualitative data which can only be collected by means of a widenetwork of measuring and sampling stations.

It has to be taken into account, however, that rightsassigned without quantitative information and updated registersof users can give rise to serious conflicts with and amongmedium- or long-term users, whether or not there exists a “watermarket”.

Given that in the initial stages it is normally the casethat not all the information required for assigning water rightsis available, each authority responsible for administrating riverbasin waters has to devise systems for assigning water which will

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be continually refined and adjusted as more and more measurementstations are available and years of registration accumulated.Usually, the decision is made to consolidate the existing usersfirst of all54 and only then to ascertain whether the means existto increase the availability of the water supply with a view toassigning greater water rights.

(ii) Role in the water market

The development and strengthening of water markets is an ideathat has gained currency in recent decades and is seen as a meansof enhancing the efficiency of water use. It is a controversialsubject, however, which is based on the possibility of holdingproperty rights in respect of water, a matter of considerablecomplexity.

Some economists maintain that, where there are no well-defined ownership rights, resources tend to be used inefficientlyand wastefully, which ultimately leads to overexploitation (theCoase Theorem, see box 15). Unless private rights are assignedfor direct administration of the resource and for providing thebenefits of proper management, it cannot be expected that userswill restrict their demands, protect the resources or invest inthem. Consequently, users of water resources who do not possesssuch rights have no incentive whatsoever to preserve, manage orimprove the catchment and use of the resources and have to dependon governments to take action accordingly. With this in mind,many governments in Latin America and the Caribbean and elsewherethroughout the world have resorted to establishing State systemsfor administration (both technical and regulatory), such as thetechnical administrations in Peru which operate irrigationdistricts (covering the whole river basin) in Peru. Experienceshows that such measures can, up to a point, serve to protect theresources and prevent funds from being squandered but at the same

54In Chile, this is done by hiring private firms of lawyers and engineerswhich, and together with boards of canal users, update the registers of usersbefore submitting them to the General Directorate of Waters forregularization. Water rights assigned without the necessary backgroundinformation have given rise to serious conflicts between various users whohave simultaneously held rights in respect of the same resource.

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time often result in costly inefficiencies. In addition, Statenorms and regulations do not offer incentives for users toincrease the efficiency of their operations. In general,regulations which result in unnecessary costs lead to the wastingof resources rather than their conservation.

A new mechanism for protecting resources consists,therefore, in introducing market forces as a means of reconcilingthe needs of the economy and of the environment and ensuring theprotection of resources. The aim is to assign well-definedproperty rights for the use of resources in a manner compatiblewith their preservation and to leave it to the users themselvesto establish the most efficient and least costly arrangements fortheir utilization, while at the same time offering strongincentives for their protection and preservation. The basis ofthis approach consists in enabling the markets to preserveresources if all parties fully assume the cost of substitutingtheir activity, i.e. the value of what they would have torenounce in order to undertake the activity in question. Itshould be noted that the initial distribution of permits or waterrights naturally presents a problem with regard to thedistribution of the income, and the method whereby such permitsare initially assigned has no bearing on the efficiency of thesystem. The system will be efficient to the extent that thepermits are transferable. The initial assignment method employeddetermines nothing more than who receives the financial incomefrom the given use of the resources.

Other economists, however, take issue with this position(see box 15). In general, all the countries maintain in theirconstitutions that water is an inalienable and essential part ofa nation’s heritage. What a State may do, therefore, is toassign rights to the use of water and to the dumping of wasteinto it. Both types of right should normally be subject tocharges, time-limits and expiry thereof. They are real rights ofan administrative nature. The water market is thus limited to amarket of use and dumping rights, and purchase-sale transactionsare subject to requirements not to cause damage to third parties

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or the environment. The rights must be entered in a public waterregister for a market to exist.

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Box 15

The paradigm of property rightsIn the discussion of externalities,the appearance in 1960 of the so-called “Coase Theorem” brought abouta “revolution”. For our presentpurposes its significance wastwofold: Firstly, it characterized theproblem of externalities in general(the environment and variousnatural resources being no morethan particular instances of suchfactors) as the result of the lackof a precise definition of propertyrights in respect to the asset inquestion, a situation which wouldexplain the lack of pricing and thesubsequent problem (in this regard,market prices have been describedas “the prices of the propertyrights”). In other words, the onlyassets that may have a price arethose for which a right of exclu-sion may be exercised with regardto other parties (capable,therefore, of being privatelyowned).

As a consequence of theforegoing, it would be sufficientfor the State to define and enforceobservance of such property rightsso that, in the absence oftransaction costs, the problemmight be resolved from the point ofview economic efficiency. The marketestablished once such a definitionhad been formulated would beresponsible for determining theprice.

The first victim of thistheorem was the traditional stance—the legacy of Pigou’s ideas—taken to

The first victim of this theoremwas the traditional stance—thelegacy of Pigou’s ideas—taken to theproblem of externalities whereby thesolution required the interventionof the State, which, through taxesor subsidies, would oblige the agentresponsible for the existence of anexternality to internalize it by payingthe costs entailed for others by hisactions (or receiving compensationcorresponding to the benefitsproduced). In this way, the privatecost matched the social cost.

According to Coase, this Stateintervention would not be necessary:it would be sufficient to define andprotect the property rights inrespect of the asset in question.The Coase Theorem undoubtedlyrepresented a major milestone in thediscussion of externalities and, inparticular, issues relating to theenvironment and natural resources.

However, from the point of viewof what might be considered itsessential contribution, seriousdoubts have been cast on thetheorem’s validity with the passingof time. This is not the mostappropriate place to undertake anexhaustive review of the mountingcriticism levelled against theassertion that it is sufficient toclearly define property rights(regardless of the direction inwhich this is done) for the marketto throw up an economicallyefficient solution. At all events,the fact is that an entire

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the problem of externalities wherebythe solution required the inter-vention of the State, which, throughtaxes or subsidies, would oblige theagent responsible for the existenceof an externality to internalize it bypaying the costs entailed for othersby his actions (or receivingcompensation corresponding to thebenefits produced). In this way, theprivate cost matched the social cost.

succession of authors, taking astheir basis the “perspective theory”of Kahneman and Tverskym and alsothe “endowment effect” of Thaler,have shown that the conclusionreached by Coase is not correct.

Source:

Diego Azqueta, Gestión y valoración de proyectos de recursos naturales, LatinAmerican and Caribbean Institute for Economic and Social Planning(ILPES), Dirección de Proyectos y Programación de Inversiones,LC/IP/L.95, 30 April 1994.

These are the conditions under which it might be possible toestablish a “water market”. The “market” is equivalent, inabstract terms, to an institutional “framework” in which theusers’ responsibilities are defined and their conflicts resolved,the hope being that such a market will serve to improveassignment, enhance the efficiency of water use and lead to itsmore rational consumption.

As a resource, water is the focus of an entire spectrum ofinterests determined by its multiple use, which essentiallyconsists of urban, agricultural and industrial uses, transport,fisheries, mining, energy generation, recreation, sanitation—inother words, life. These are crucial factors and need to be takeninto consideration when designing market instruments to ensure thatthey are as flexible as possible and that they fulfil thefunction of resource assignment.

It should also be added that, as an asset, water possesses avariety of characteristics: at one end of the scale it is apublic asset and at the other private property, while it can alsobe classified among toll goods, open access goods and meritgoods.

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These classifications55 based on an analysis of thedifferent degrees to which an asset can be of “exclusive” use,i.e. those who do not fulfil their payment or other requirementsbeing excluded from its use, and “appropriable”, this being thepoint at which an asset used by one person may not subsequentlybe used by another.

A public asset, such as a public town square, is neitherexclusive, since anyone can gain access to it without paying, noris it appropriable, since its use by one person does not preventits use by another. In the case of a private asset, theseconditions are reversed, in other words, they are appropriable inthe same way as a piece of fruit which, once consumed by oneperson, cannot be consumed by another; and exclusive in thatanyone who does not pay for the fruit cannot buy it or possessit.

Were a water market to exist, it would have to take accountof these various possibilities of transformation which the sameasset—of water—possesses in the course of its passage through ariver basin. It should be remembered that, for the same reason,in the case of water what is withdrawn (in terms of location andposition, time, quantity and quality) is as significant as whatis returned. Moreover, a water market may be affected by theprice of the transfer of the asset from one place to another, itseffect on the environment and its effect on social equity.

A hypothetical water market will be complex in structure andgenerally cautious and not highly competitive because of thenecessity of its regulation by the authorities, especially asregards satisfying the requirement that water transactions shouldnot be prejudicial to third parties. In the case of water, theassignment of resources by means of an unregulated market couldlead to major economic, social and environmental losses for allusers. It should be borne in mind that, from the economic pointof view, the best course lies in the reconciling of interestsrather than competition (see box 16); it would not be economical

55International Bank for Reconstruction and Development, Water ResourcesManagement, a World Bank Policy Paper, World Bank, Washington, D.C., 1993.

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to build a number of main canals along the same river bank,capturing water from the same place, in order to ascertain whichone supplies the cheapest water.

If there is an opportunity to buy and sell water rights in acountry, this must be taken into account for the purposes ofmanaging the water resources of the river basin and planning itsdevelopment.

Box 16

Intersectoral relations in river basins in ChileIn the entire complex of issuesrelating to intersectoral relationsin river basins, which includerelationships between the uses andusers of waters of different types,the institutional framework providedby the Chilean Water Code has provedmanifestly inadequate. These issuesdid not receive any great attentionin the drafting of the Code savethat they were tackled merelythrough the combination of privaterights, the logic of market forcesand the subsidiary status of theState. It was hoped that thiscombination would lead to the moreefficient assignment of resourcesthrough transfers of water rightsand other transactions between thedifferent sectors. According to thisapproach, in order to encouragemultiple use of water resources asignificant innovation wasintroduced, namely that of creatinga new type of property right—thenon-consumptive water right. The aimwas to allow hydroelectricdevelopment in the upper reaches ofwater basins without detriment toconsumptive uses— mainly irrigation—of waters downstream.

Conflict resolution, then, dependson the functions and actions ofthe judiciary, which in thecurrent institutional frameworkhas greater strategic importancethan ever before. This functionhas to be discharged in tworelated areas:

First, the safeguarding of theconstitutional guarantees ofprivate individuals and theresolution of conflicts arisingbetween them, and

Second, the monitoring ofadministrative actions.

In both these areas, the judiciaryhas shown great zeal, demonstratinga marked tendency to reinforce andeven extend private property rightson the one hand and, on the other,to ensure that the governmentalauthorities (especially DGA) abidestrictly by the laws. The tangibleresults achieved in relation toriver basins, however, have been farfrom satisfactory owing largely tothe bureaucratic and self-limitingapproach adopted by the judiciary asregards its own role: it tends toshy away from the nitty gritty

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Box 16

Intersectoral relations in river basins in Chile

In order to coordinate thevarious uses of water and to resolveconflicts arising between them,reliance is placed on privateinitiative through three mechanisms:

Negotiations between private individuals; Action taken by users’ organizations,

which in the case of naturalwatercourses means oversightcommittees (without prejudice tothe possibility of others beingestablished); and

Lastly, actions and proceedings within thejudicial system.

The government administration, or inthis case the Department of WaterResources (DGA), plays a fairlylimited part in this regard.However, in the cases studied—principally the Bío-Bío and Mauleriver basins—where problems arebeing confronted in the form of bothwater pollution and the relationshipbetween consumptive and non-consumptive uses, none of thesemechanisms has been successful insorting out the factors involved,let alone settling the conflicts.

The oversight committee failedin this area because theirtraditional function and legalcompetence are confined to supplyingwater to their members, these beingprincipally irrigators, althoughthey may also include companiessupplying drinking water, industrialenterprises or electricityutilities. They are not qualified todeal with matters of pollution, nor

detail of technical matters, evenwhen its own case-law leavesquestions open, while DGA, for itspart, limits its intervention forfear of control by both the courtsand the Treasury Inspector’s Officeof the Republic. The self-limitationexercised by DGA is confirmed by thefact that the courts—despite their attitude ofvigilance in this regard—support itin most of the judicial proceedingsconducted against it. (Perhaps themost significant example of thisproblem is the conflictualrelationship between consumptive andnon-consumptive water rights,especially with respect to themultiple use of dams; this was notclearly defined in the Code, andneither the judiciary nor thegovernment nor private actors havebeen able to resolve the matter in acomprehensive or systematic fashion.To do so would entail contemplatinga change in the current legaldistinction between water rights inrespect of rivers and those inrespect of modified lakes, somethingwhich would interfere with optimalmanagement of the hydrologicalsystems.)

In short, there is a yawninginstitutional gap in the realm ofintersectoral affairs owing to alack of effective coordination, theconsequences of which includeeconomic inefficiency, negativeexternalities in both the social andenvironmental spheres and persistentpolitical and social conflicts. Ithas not proved possible to fill this

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Box 16

Intersectoral relations in river basins in Chilehave they been able to impose theirwill on the hydroelectric usercompanies, which enjoydisproportionately great votingpowers on the committees owing to adeficiency in the Water Code. Theonly halfway effective rulesapplicable to the coordination ofconsumptive and non-consumptive usesderive from agreements establishedbetween fiscal authorities severaldecades before the current Code wasintroduced. (It is possible thatthese committees have had greatersuccess in other river basins.)

As regards users’organizations of a different type,such as a coordinating andadministrative authority for anentire river basin, a more seriousattempt was made in the Bío-Bíoriver basin at the instigation ofthe regional private sector and withthe cooperation of the regionalpublic sector. This failed, however,because not all the actors wereprepared to subject themselvesvoluntarily to such an entitypossessing genuine powers. It wouldseem that people are ready to talk,but goodwill is not enough when itcomes to real conflict.

gap either through privateinitiative or through the forms ofaction currently taken by thejudiciary or the government. Neitherhave market mechanisms beensuccessful in this regard, assuggested by the fact that it has todate been difficult to finalize theplanned clauses on water rights inthe Code, more than anything becausetheir complex intersectoralimplications have always requiredsolutions of a rather political hue.All this implies that what islacking at present is legislationdirected to at least one of threepossible objectives:

Strengthening and/orrestructuring of the oversightcommittees;

Encouragement of the creation ofnew regional authorities with ameasure of public and privateparticipation; or

Promotion of the negotiation of abinding agreement among thevarious actors involved.

At all events, it is essential thatsome entity should have genuineauthority with regard torelationships between water uses,even if the structure andcomposition of such an entity mightvary from one region of the countryto another.

Source:

Carl J. Bauer, Derechos de propiedad y el mercado en una institucionalidad neoliberal:efectos e implicancias del Código Chileno de Aguas de 1981, Discussion Paper, 1993.

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In order to design any type of water market it will benecessary to consider it in the same way as a scarce resource onwhich it is necessary to place an economic value and a charge forthe service whereby the water is supplied, disposed of andtreated. This presupposes the need to charge for the exercise ofwater rights, a charge which is based on the quantity withdrawn,consumed and returned and also on the utilization of waterresources for the purpose of receiving and assimilating pollutantloads (contaminants). A further factor of note is the position(altitude above sea level) at which water is captured andreturned, on account of its energy-generating function.

As the economic value of water is associated with itsopportunity cost and its physical presence, logic dictates theneed for a flexible market system. The price of water will varyas a function of the opportunity cost and its physical presencewithin the river basin, different costs being possible for thedifferent uses, depending on changes in quality and quantity, thetime of year and extreme hydrological situations, whetherfavourable or unfavourable.

The imposition of taxes for the use of water (rates orcharges) should be an instrument which encourages rational use ofwater on the part of the consumer, who will thus have anincentive to use the best technology and control systemsavailable. On the other hand, financial penalties imposed onoffenders (such as polluters) should deter them from violatingthe regulations in force, the option of expiry of water rightsbeing a further possibility. It is necessary, for this purpose,that the penalty imposed should be sufficiently severe to act asa deterrent against reoffending, while at the same time beingcommensurate with the offender’s financial means so that he canactually afford to pay it. The State may reserve the right tosubsidize water-treatment systems in order to keep certainproduction systems afloat.

While the value placed on the use of water (as reflected ina rate, tax or subsidy), in combination with penalties, mayresult in rational use, the introduction of such a system can

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have major repercussions for the local and regional economy. Forexample, the inflated prices of agricultural goods produced inthe region, inflated because of the cost of water, can make themless competitive in markets and thus have undesirable economicand social consequences for the farmers.

The market instruments to be recommended and devised mustincorporate a vision of the integrated management of waterresources with a view to ensuring their preservation, use,recovery and conservation on terms geared to their multiple usersand in a form compatible with the productivity and balanced andsustainable development of the region.

Market instruments must be capable of strengthening themarket in the best way with the aim of maintaining a balancebetween supply (which is unpredictable) and demand (which isgrowing) with a view to reconciling the interests of thedifferent users.

The basic objectives of market development and strengtheningwould be: to redistribute costs in an equitable manner; toregulate demand by increasing productivity and efficiency in theuse of water resources; to finance regulatory activities; and topromote integrated regional development, especially in its socialand environmental dimensions.

This requires penetrating analysis of the long- and medium-term operational, economic, social, cultural and politicalfactors affecting the river basin, without losing sight of urban,industrial or agricultural expansion, which can have a limitingeffect on the availability of water.

2. Basis for establishing river basin agencies

Most of the meetings on river basins have tackled the generalaspects of this question at a very superficial level, discussionbeing mainly confined to technical subjects. This is borne out bythe dearth of reference documentation on the management of river

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basin agencies, with the exception of a few prepared in Brazilwhich only became available after this document was finalized.56

The basis required for establishing river basin authoritiesare essentially political, legal, financial and social.

56Antonia Eduardo Lanna, Gerenciamento de bacia hidrográfica: conceitos, princípios eaplicaçaões no Brasil, Ministry of Education and Culture, Rio Grande do Sul FederalUniversity, Institute of Hydraulic Research, 1993.

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A. Political basis

In tackling the various factors affecting environmentalmanagement based on river basins, their natural resources orwater alone, reference should be made to the discussions takingplace in recent times as to what precisely are the respectivefunctions of the public and the private sector in this area. Itis also necessary to deal with the issue of water policies andhow they are linked to economic policies. The greater focus onthe participation of communities and regional authorities andtheir new roles should also be taken into consideration. Forexample, the need for a participatory decision often renders theuse of terms such as river basin “authority” inappropriate, otherterms such as “organismo” (Spain), “agence” (France) or the moreneutral “entidad” (agency) used in this paper being preferred.Only with this information is it possible to determine whichmanagement systems would be best suited to dealing withenvironmental issues in general and river basin management aspart of that larger complex of issues.

One of the reasons for the failure of the attempt to set upwater and river basin management systems is the relativeunconcern with which proposals for setting up of such agenciesare presented, whether they be public enterprises, corporations,committees, agencies or any other organizational structure. Ingeneral, the aim pursued in the explanation of the reasons for agiven proposal is that the entity should operate according to aholistic approach; that it should be economically efficient,self-supporting and competitive; that it should be sociallyoriented and foster equity; and that it should have anenvironmentally responsible attitude. It is asserted that itshould be composed of public and private sectors, that it shouldallow community participation and adopt a conciliatory ratherthan authoritarian approach. On close scrutiny, it represents thequintessential aspirations of some kind of “super” authoritypromoting sustainable development. The management of such anauthority is akin to the complexity of genetically breeding ananimal capable of providing meat and milk as well as eggs and

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wool, with the refinement that it should also be pleasant andtolerant, have political clout and not eat very much in order tokeep down the cost of its maintenance.

Experience shows that without being over-ambitious at theoutset, it is possible to gradually fashion a river basin agencywhich at least discharges its basic function of preventing,limiting or settling conflicts between water users. In order toaccomplish this basic task, the authority has to be establishedin such a way that it implements water resources policies withthe participation of the users.

According to Irving Fox, there is no consensus as to what ismeant by the term “water resources policy”.57 However, the sameauthor states that policies of this kind may be classifiedaccording to three criteria which determine how water resourcesare managed and utilized by a given society, namely:

The basic rules, The organizational principles, and The fundamental procedures.Fox does not define each of these criteria but simply gives

examples. For instance, he considers that the basic rules canapply to areas such as the assignment of water-use rights andpriorities, where these exist, and to other similar principles.One example of the organizational principles could be theformulation of a policy on water use which would stipulate asingle authority for each river basin, established jointly byusers and the State, with wide-ranging powers and autonomy todirect complex and multi-purpose water resources programmesgeared to regional development targets. In other words, part ofthe business of formulating policies is to consider how to setabout organizing the management system necessary for implementingthem. The fundamental procedures relate to the means, measures oragencies necessary for performing the required actions, such asstipulating that in order to assign water-use rights it is first

57Irving K. Fox, “Problemas de política hídricos”, Recursos hídricos, Vol. 1,No. 3, Buenos Aires, 1970. This study was submitted by Professor Irving Fox,Associate Director of the University of Wisconsin Water Resources Center, tothe United Nations Panel of Experts, Buenos Aires, 1970.

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necessary to ascertain that the resource is available, that thereare no conflicts of use with other users and that it will be usedfor a specific purpose, during a predetermined period and subjectto the requirement that third parties should not be affected.

Accordingly, in order to be complete, a water policy shouldinclude both a declaration of intent and proposals relating tomatters of organization, regulations and functions.

In addition to these three basic criteria identified by Fox,mention should also be made of the need to accompany policydeclarations by a statement of priorities and an indication, orat least an outline, of the so-called “policy instruments” withwhich it is planned to apply the policies.

The policy declaration may also be analysed according to themethodological sequence devised by A. Dourojeanni for theguidance of management procedures directed towards sustainabledevelopment.58 This sequence is useful in orienting theformulation of policies relating to water in a manner that issomewhat more rigorous than normal; it states that in order toimplement water policy it is necessary to:

Determine the actors involved in the management process; Determine the criteria applied by those actors (policies,

principles, functions, etc.); Identify problems arising in relation to those criteria; Determine their objectives; Demarcate the limits within which it is sought to achieve

those objectives; Identify the obstacles in the way of their achievement; Propose solutions for overcoming the obstacles identified; Determine the strategies to be followed in applying the

solutions; Design programmes and projects to apply the strategies

selected and evaluate them;

58United Nations, Economic Commission for Latin America and the Caribbean(ECLAC), Procedimientos de gestión para un desarrollo sustentable (aplicables a municipios,microregiones y cuencas), LC/G.1769, 31 August 1993.

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Carry out one-off and ongoing programmes and projects.

With regard to this sequence, the formulation of policiesshould coincide as far as possible with the identification of thecriteria for action and the objectives of the actors. For themost part, the criteria consist in declarations of intent. Theimplementation policies, however, can only be formulated oncesolutions and strategies have been identified. In other words,the framing of policy in the area of water resources is a processthat has to be carried out systematically, step by step, so thatfactors crucial to the success of implementation are notoverlooked.

The path of rigour has seldom been followed by the countriesof the region in formulating water policy. It is generallyundertaken on the basis of the immediate economic situationwithout an established procedure being followed. As mentionedearlier, water resources policies in the region have in someinstances favoured the formulation of plans, in others theredrafting of the law (not as the culmination of a process ofpolicy-making but rather as the initiation of this process), andin yet others the establishment of organizations and so on.However, it is a matter of concern that the vast majority ofthese proposals are not properly harmonized, despite it beingknown that organizational systems, laws and plans, to mention buta few components of an execution policy, have to be wellcoordinated.

Measures are thus taken which are either partial or merelyaimed at not conflicting with an economic system, strengtheningthe application of other laws (such as the drafting of theGeneral Waters Act in Peru with the aim of supporting the 1969Agragarian Reform Act), easing isolated and sometimes incidentalconflicts between users, appealing to particular groups of votersor accommodating a regionalization project. In suchcircumstances, water policies are normally formulated in a patchyand incomplete manner.

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Although these policies have to support national developmentpolicies, it should be recalled that both water resources and theprocesses for their development have specific features whichcannot be disregarded without glaring contradictions opening up.As early as 1970, Irving Fox warned of the problems created by attempting to linkwater management to a free-market economy without taking into considerationthe particular aspects of the case. The specific features of water as aneconomic resource necessarily require, if not the preponderantinvolvement of the State, as Fox maintains, then at least jointmanagement between the State and the users in administeringwater supply from a river basin or interconnected system (seebox 17).

In a water system shared by different users, the servicesprovided to satisfy different demands may be in private hands(drinking water, agriculture, hydroenergy, etc.), whereas theadministration of water supply from the basin, including allpossible forms of redevelopment, has to be in the hands of theusers and the State. This is the only way of resolving potentialconflicts and furnishing resources in order to prevent commonproblems such as pollution and flooding, while also controllingexternalities (for example, the relationship between riversediment yield and its effects on the coastal strip into whichthe river opens). This principle also obtains in the organizationof a community; while properties exist which are administered byprivate individuals, it is also necessary to have a municipalauthority which regulates areas of common concern and preventsprivate property from producing external effects for the rest ofthe inhabitants.

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Box 17

Private-enterprise economies and water managementIn countries which rely heavily on theprivate sector for the production anddistribution of goods and services, itis generally assumed that a competitivemarket will assign resources anddistribute goods and services inaccordance with the general publicinterest. If this is the case, why dothese countries need their governmentsto establish a water resources policy?The answer is that, even in those caseswhere the private market functionsreasonably well as a resource-assignment mechanism, there arenumerous reasons why government actionis needed to ensure appropriateinvestment in water resources and asatisfactory framework for theproduction and distribution of watersupplies and services.

This is due to the fact that it ismore difficult to determine propertyrights in the case of water than inthat of most other resources. Precisedetermination of property rights iscrucial to the proper operation ofeconomic institutions within theprivate sector. Since water flows fromone place to another (lawyers refer toit as a “fugitive” resource) and sincethis flow varies according tohydrological conditions, thedetermination of property rights inrespect of water has given rise to sometricky problems. In some places wherewater and its use have been intensivelydeveloped, it has been necessary topass very detailed legislation definingrights to the use of water. In order toensure that such legislation is in thepublic interest, national objectives

if reasonably good results aredesired.

A third factor impeding theproper operation of an unregulatedprivate-enterprise system in thefield of water resources is theimportance of what might be termedthe “external” effects of water use.A deposit located at a point in ariver basin will influence flows andthus affect the profits and costs oflocalities downstream. In order toexploit hydroelectric energy to thefull, the deposits of dumpedmaterials in a river basin have to beestimated and managed in such a waythat these inter-relationships aretaken into account. When a watercurrent is used in order to get ridof refuse, these “external” effects(pollution) can be damaging. In caseswhere different private enterpriseunits are involved in the developmentand administration of a river system,these “external” effects, bothpositive or negative, risk beingoverlooked unless government actionrequires otherwise; if they are nottaken into account, it is impossibleto achieve a good level ofefficiency.

There is yet another reason whya private-enterprise system cannotobtain optimum results in the absenceof governmental action, this beingthat certain services derived fromwater development cannot be dividedinto units for sale and purchasepurposes in a competitive market. Forexample, when works are constructed

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and scales of values need to be takeninto account, and the legislation needsto be drafted in such a way as to servethese principles and values. In short,legislation on water supply must bedirected towards national policyobjectives.

A further reason why a marketeconomy does not achieve optimalresults through the free play of marketforces in the field of wateradministration is the existence ofmajor economies of scale in waterresources develop ment which make ituneconomical to have competitionbetween different units devoted towater production and supply.

For example, it is not feasible to havecompeting means for the supply of waterfor household use or agriculturalpurposes. It is uneconomical to haveshipping canals or even electric powersupply systems in competition with eachother in the same region. However,competition is essential in anunregulated private-enterprise economy

to control the effects of risingwater levels, they will protect allowners of property along a stretch ofriver so that the owners do not havethe option of deciding whether or notto buy such protection. Likewise, inthe case of recreational facilities,these will benefit the public ingeneral and cannot be bought or soldon the market.

The net result of the multiplephysical and economic characteristicsof water resources is that, even in aprivate- enterprise economy, a largedegree of State intervention isnecessary in order to ensure that thedevelopment and management of waterserve the objectives and values ofsociety as a whole. Intervention bythe government, for its part, must besubject to a set of policies andrules related, on the one hand, tosocial objectives and, on the other,to the physical and economiccharacteristics of the waterresources.

Source: Irving K. Fox, “Problemas de política hídrica”, Recursos hídricos, Vol. 1,No . 3, Buenos Aires, 1970.

The regionalization of various countries has given rise tomajor incompatibilities between development policies and waterpolicies. On several occasions in Peru, for example, as a resultof the regionalization programmes applied by various Governments,some river basin authorities which had been attached to thecentral government were suddenly under the direction of two oreven three regional authorities, since the river basin area whichthey administered was split by the boundaries of more than oneregion.

It is no easy matter to determine the manner in which riverbasin management processes are conditioned by a country’s

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policies or the degree of influence of the latter. Since therepercussions of policies relating to water management in a riverbasin are often unknown, it is difficult to propose formulas forimproving them. In other words, if it is not known how theapplication of current water development policies actuallyfunctions (causes and effects), it is difficult to decide what todo to improve their efficacy.

In many countries there is no catalogue of laws relating tothe management of water resources or the other natural resourcesof river basins. In some instances, in fact, there is not evenany register of users according to river basin or water system,nor inventory of the studies performed in each one.59 It is easyenough to research the contents of policy statements,organizational charts and official breakdowns of functions, butfinding out to what degree these are implemented in practice isnot so simple. Many local government authorities lack sufficientresources to accomplish their tasks; nor do they publish theirdocuments in sufficient quantities, keep records of their studiesor coordinate their actions in relation to river basins.

At present, most water policies derived from changes ineconomic policies are no more than declarations or, in otherwords, policies of intent. However, in many cases, without anygreat depth of analysis, policies of intent have become laws,again, “of intent”, which leads to serious gaps, especially interms of instruments for implementing the policies. There havebeen various instances in which there has been no correlationbetween the spirit of the policy, what appears in the law, andwhat is finally achieved through its application, the reasonbeing that the management system used has been unworkable.

There are a number of basic considerations which have to beobserved if it is sought to frame policies with a minimum ofconsistency regarding management of the environment, natural

59Axel Dourojeanni y Juan Gómez, “Sistema de gestión del agua en lacuenca del Río Mapocho”, Anales del Seminario sobre Gestión de los Recursos NaturalesRenovables en la Cuenca del Itata, University of Concepción and Provincial Governmentof Ñuble, Chillán, Chile, 22 November 1991.

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resources or water alone. It should be borne in mind that if thepolicies themselves are inconsistent, the management agenciesresponsible for implementing them will be also.

In principle, it is evident that not just any policystatement will necessarily qualify as either politics or policy.To do so, it has to be composed of basic rules, organizationalprinciples and fundamental procedures.

It is also necessary that any pronouncement of changes orpromulgation of new policies should be based on clear analysis ofthe advantages and disadvantages of applying the policiescurrently in force. In no circumstances would a new policy beexpected to make the situation worse or undermine theeffectiveness of any other, newly promulgated policy.

It is also important that the assumptions implicit inpolitics should be tested by applying rigorous methods, such asthat indicated in the sequence of management procedures forsustainable development.60 This is a vital precondition formaking the transition from politics to policies. For example, ifthe aim is to create a water market, great caution must beexercised in the assignment of water rights in perpetuity untilit is known how such a market is going to function, whatregulation is necessary and what effects it will have on societyand the environment.

In environmental matters, including water and other naturalresources, it is necessary to understand and to incorporate inthe water policy statement the restrictions imposed by thebehaviour and requirements of the environment in general and of

60Axel Dourojeanni, Procedimientos de gestión para el desarrollo sustentable (aplicados amicroregiones y cuencas) (Management procedures for sustainable development(applied to microregions and river basins)), Latin American and CaribbeanInstitute for Economic and Social Planning (ILPES), Document 89/05/Rev.1,Serie Ensayos, Santiago de Chile, October 1991; and Axel Dourojeanni and JuanGómez, “Sistema de gestión del agua en la cuenca del Río Mapocho” (Water management systemin the Mapocho River Basin), “Records of the Seminar on Management of Renewable NaturalResources in the Hata River Basin”), University of Concepción and ProvincialGovernment of Ñuble, Chillán, Chile, 22 November 1991.

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water in particular. The natural system does not modify itsbehaviour simply because human society decides to change thesystem or form of government or the economic or commercialsystem.

Without doubt, environmental and water policy statements inparticular require that consideration be given to the prevailingeconomic policies and to the roles of the private and the publicsectors. This is the key to determining the policy instruments tobe employed and also the type of organization needed to applythem.

In environmental, natural resources management or watermanagement policy statements, it is necessary to specify theorganizational system that will be applied under policies and, inparticular, the economic instruments that will be used to ensurethat the system can function regardless of whether it is public,private or semi-public.

One of the conditions dictated by the environment iscontinuity of action. In other words, an environmental managementsystem has to endure beyond the life of a government. For thatpurpose, it is necessary that the policy statement be accompaniedby a preliminary draft law and regulations fostering thenecessary continuity in the management system, in order to ensureits financing, effectiveness, adaptation and legitimacy. A keyrole in ensuring this continuity is played by the long-termretention of well-qualified technical personnel.

To be successful, an environmental policy also has to beunderstood by the public. It is therefore important to indicatewho participated in formulating the policy and who will beinvolved in its subsequent application, and also how thedecisions were taken. The role of all the actors and theirrelative participation in the process of applying and adhering topolicy instruments will need to be specified so that they feelinvolved.

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Reconciling economic and environmental objectives is a keyfactor because of its crucial importance when attempts are madeto apply a social and market economy. Both objectives can beachieved that the behaviour of each system is clearly laid downand mechanisms devised for reconciling them (see box 18).

To elaborate on this last point, with regard to a singlenatural resource such as water, for example, we have collectedtogether a number of points made in a study carried out by A.Erhard-Cassegrain and J. F. Margat,61 aptly entitled“Schizophrenic rationality and water resources utilization”,which provides the basis for the ideas explored below:

The first point to be taken into account is that the factthat in the area of water resources, the reasoning applied tooptimum economic returns differs from the corresponding optimumuse of water: optimum economic yield in a market is achieved throughopenness to competition and rivalry; optimum economic yield for the multiple useof water resources is achieved through an objective, calculated and plannedprocess which relies on the participation and agreement of the actors involved init, including the State.

This does not mean that the use of economic instruments isnot valuable and in fact of cardinal importance in achieving theobjectives of optimal water use, especially at the sectorallevel. Such economic instruments can help to adjust andencourage joint efforts on the part of users, particularly thoseaimed at obtaining resources in order to counteract the adverseeffects for all of them of natural phenomena such as floods,droughts and rainwater runoff in urban centres and to reducepollution and the unsatisfactory use of land and its resources.

The demand for a natural resource such as water has atwofold effect on supply. Firstly, water is extracted from theenvironment (river, well) and used in various forms; secondly, itis returned to the environment with changes in quantity and

61A. Erhard-Cassegrain and J. F. Margat (consultants), “Schizophrenicrationality and water resources utilization” (WATER/SEM.6/R.20), Geneva,Economic Commission for Europe, 1979.

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quality (to the same river or to a different one, or to thegroundwater table). This is a double interaction which is notcommon to all marketed resources. Thus, in the water economy itis not sufficient to consider only the efficiency of “extraction”and “use”; the efficiency of “return” also has to be taken intoaccount.

Water management, as stressed earlier, is the management ofconflicts between users competing for the same resource, many ofwhich do not have any inkling of how their interaction has mutualprejudicial or beneficial effects. Management of the environment,and of water in particular, should help to prevent and as far aspossible eliminate such conflicts through analysis of theinterrelationships between the actors and the proposing of“environmental” negotiations or transactions among them.

In environmental policy-making, especially in relation towater, a natural system (ecosystem, river basin) or a singleresource such as water is often arbitrarily divided, formanagement purposes, according to user group, sectors responsiblefor its control, types of use (consumptive or non-consumptive),the source where the water is captured (whether surface water orgroundwater), river and sections or stretches and other similar,arbitrary criteria.

Box 18

The problem of optimum naturalresources management

The management of natural resourcesessentially functions according to thewell-known rule of Hotelling, whose mainpoint states that the owner of anyresource focuses, when seeking the bestreturn on his investment, on two keyfactors: The yield to be provided through

exploitation of the resource; The opportunity cost of the capital

deficiency. More recently, however,since the appearance of the so-called“Coase Theorem”, emphasis has beenplaced on the absence of certain well-defined and protected property rights inrespect of natural resources.

Second, it is not only price-freenatural resources that pose problems. Afurther problem relates to natural

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immobilized in it, meaning the returnobtainable by realizing its value(i.e. selling it) and investing theproceeds.

As regards the first of these factors,the profitability of the resource hastwo sources: the flow of financialincome obtained through itsexploitation, which obviously depends onthe expected prices of the productobtained; and the possible capital gains(revaluation) provided by the stock ofresources in question. Optimalmanagement, in the final analysis, ismanagement which achieves a point ofbalance at which the rate of returnobtained from exploiting the resourceequals the economic interest rate, asreflected by the capital opportunitycost (average economic interest).

Expressed in these terms, theproblem of natural resources managementdoes not differ substantially from thatof the management of any asset. Unfor-tunately, however, the situation is notthat straightforward, the reasons forthis being threefold:

In the first place, because manynatural resources are common propertyand therefore freely accessible theyhave no price attached to them. The firstrequirement for their optimumexploitation is therefore lacking: itis difficult to establish theirprofitability when they do not evenhave a price. It should be added that,because of their intrinsic nature, theprice required would have to reflectthe value which such resources have forsociety as a whole and not solely fortheir owner: the functions performed bythe environment and natural resourcesmean that, essentially, they arecollective assets. This lack of price

resources which, while having a price,generate a large number of positiveexternalities which are not reflected in theprice. To give an example, from thefinancial point of view, although the oldFaustmann equation (which gives theoptimum biological period of tree felling)incorporates considerations relating tothe respective prices of timber, thetypes of interest involved and thenatural risks, it is not surprising thatthe recommended course is to fell thetimber, invest the profits in some otherconcern and not restock. This happenswhen the expected biological growth rateof the volume of the wood multiplied bythe expected prices of timber, fallsbelow the economic interest rate (whichreflects the profitability ofalternative investments). Consequently,the privatization of natural resources,especially slow-growing resources, wouldnot solve the problem. The profitsobtained by the owner of an area ofwoodland from its exploitation do notreflect the benefits represented by thatwoodland and its conservation forsociety, this being a set of positiveexternalities which are not, however,included in the market price of theresource.

Third, it cannot be claimed eitherthat there has been any greater successin obtaining information regarding therate of interest. This is not so muchbecause such information is unavailablebut rather because, while we mightaccept that this type of interestadequately reflects the opportunity costof the capital in the economy, there isno reason to believe that it alsorepresents the temporal preference ofsociety: its relative evaluation of afuture value with respect to its presentvalue (the consumption discount rate,for example). And this is a requirement

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(as distinct from value) naturallyleads to a concomitant overexploitationand degradation: economic theory tellsus that when a resource is consideredfree (i.e. without price), its use istaken to the point at which its finalincorporated unit has a marginalproductivity of zero. A more debatablepoint is the reason why such resourcesare not priced and, in particular, howthis deficiency can be overcome. Thestance traditionally taken has beenthat, for a variety of reasons, the lackof markets is responsible for this

for achieving the optimum intertemporalsocial equilibrium.

It would therefore appear necessary,in approaching the problem of optimummanagement, to carry out an evaluationof the natural resources by attaching tothem a price reflecting all the benefitsyielded for society by their existenceand exploitation, unless we accept that,once created, the market will do soitself.

Source: Diego Azqueta, Gestión y valoración de proyectos de recursos naturales, Latin Americanand Caribbean Institute for Economic and Social Planning (ILPES),Dirección de Proyectos y Programación de Inversiones, LC/IP/L.95, 30April 1994.

The natural system is arbitrarily fragmented and, as a result, themanagement of a naturally integrated system is also carried out in a fragmentaryfashion. For the authors cited, in referring to the integrity ofthe water system it is not sufficient to rationalize the supplyof water to each user in terms of quantity and quality unlessconsideration is given to the way in which it is to be returned tothe environment (quantity, quality, time and place). Therestoring of the resource can have both negative and positiveeffects. For example, a large quantity of domestic waste waterreduces the concentration of chemicals in the liquid industrialwaste dumped by enterprises and also facilitates its transport.

The concept of “water economy” is of no significance in thematerial sense, where the ideal is to minimize the quantity ofwater extracted from the system or used in a process. If water isreutilized in other processes, it may prove more cost-effectiveto use more water in the initial process. For example, limitingthe water used for irrigation in some areas gives rise toincreased costs and a greater concentration of salts in the soil.However, if the water can be harnessed, treated and reutilizedsubsequently, it may be more economical to use more water in theinitial process.

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It is not sufficient to assign water uses by sector(household, agriculture, industrial) unless consideration isgiven to their interactions, since a conflict will arise betweeneach type of demand and the supply system (groundwater forirrigation, river water for industry, section of river forassociations of irrigators, extraction of river-bed materials formunicipal authorities). The physical units of the supply systemare arbitrarily divided according to the different uses, in thesame way as a river is divided up into sections assigned todifferent user groups, disregarding the effects of theirinterdependence along the course of the river. With such anapproach, water demand is sometimes forecast purely according tothe classification established for its supply (groundwater demandfor towns, river water demand for industry).

Demand is almost always evaluated according to quantityrather than quality, as if the two criteria could be separatedfrom one another. The fact is overlooked that the two factorsinteract at each of the points at which water is restored to themain system and that extracting or returning water gives rise tochanges in quality and in the capacity of the environment toabsorb certain pollutants.

The value of water as an input in the production process isoften assigned without reference to the interaction betweenextraction, use and return. For example, when water is assigned avalue, there is no precautionary cost allocation for thepollutants which will be discharged into a watercourse when acertain quantity is returned; nor is any charge made for the useof water as a means of conveyance and sometimes as a diluent ofwaste, in addition to its use in a production process.

The costs of negative external effects or “externalities”,such as pollution caused by the use of water as a means ofconveyance waste, are ultimately “factored in” according to thepolluter pays principle. However, this rule is usually appliedafter a period of several years in which industry has beendamaging the environment and users have started to complain. Toavoid this, preventive steps have to be taken as regards both

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charging and the application of decontamination measures.Initially, a time lag will occur between the time ofcontamination of the water and the time at which clean-upoperations are initiated. What happens is that no account istaken at the outset of the fact that the user will not only beusing the water in its production process but also as a means ofconveying its wastes, a factor that can be calculated and chargedfor at the beginning, with an estimate even being possible ofthe alternative cost for the factory of using lorries totransport its waste rather than water and river courses.

This situation is exacerbated exponentially because thewater supply management systems, which are also fragmented, donot have any coordination mechanisms. Some deal with waterquality (such as health ministries), others with the extractionof aggregate (such as municipal authorities or ministries ofmines), others with river defences, others with groundwater,others with water use rights and so on. Lack of coordinationleaves a succession of gaps in management. This also explains whymany “plans” or “scenarios” formulated by these entities donothing more than extrapolate the fragmentations referred to. Forexample, each sector projects its own demand, taking no account ofthe impact it will have on a river basin or how it will affectsupply and the interaction between types of demand. Hence thescarcity of proposals put forward for reducing demand at theinitiative of the sector itself, which draws up its planindependently. All the parties demand the “maximum” and, if theycan, acquire as many water rights as possible on a precautionarybasis. Disputes arise over what is needed today and what may beneeded tomorrow.

Consequently, virtually no sectoral policy seeks to reversedemand trends by, for example, relocating industries to moreappropriate sites; rather, attempts are made merely to satisfythe demand. No consideration is given to the option ofsimultaneously acting on both supply and demand because there is nointegrated management system in existence that depends primarily on the usersthemselves and under which measures in both the individual and collectiveinterest might be proposed in order to achieve economies of scale.

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In the absence of integrated management policies, technicalrationale is mixed in with economic rationale and this in turnwith financial reasoning. Instead of opting for a rationale inthe choice of objectives that will help resolve competitivesituations (bearing in mind that water management is conflictmanagement), a techno-financial rationale is ultimately adoptedwhich is useful and reasonable for each individual sector butunreasonable for the whole, so much so that greater losses arecaused to each (increased costs of water regulation andharnessing, control of extreme phenomena and decontamination).

Maximizing the economic and water-related benefits for eachsector works against the achievement of an optimum benefit forthe whole. The end-result is a social, economic and environmentalloss for all. To see water economy as a “material economy” of theresource is to confuse the issue. It would appear rational toeconomize on water and thus reduce consumption; it is alsorational to choose the cheapest water-supply solution (infinancial terms). However, these two concepts are contradictoryand sometimes incompatible if taken as part of one and the sameobjective.

Where there is no integrated management system, what alsohappens is that the benefits generated by one actor for otherwater users (such as mitigation of the effects of flooding ordrought through the construction of a dam for a hydroelectricplant) are neither acknowledged nor paid for. By contrast, thoseaffected will be sure to claim for any negative effects whichmight arise. Consequently, water management and economicmanagement must be viewed “top-down”, in an integrated fashionand not by parts. If fragments are analysed, the erroneousconclusion may be reached that “optimizing” each water use inmaterial terms means that the economy is also “optimized”. Inpractice, the economy will reach its best level when the entiresystem is analysed.

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The choice of the most appropriate economic managementinstruments can only be made if this integrated approach isadopted.

B. Legal basis

Generally speaking, laws reflect the “margins” within whichsociety permits individuals or groups of individuals to conducttheir activities.

In the sphere of natural resources management (especiallythat of water resources) in relation to river basins, thelegislation reflects the politico-environmental, techno-administrative and economic-financial limits within whichindividuals or groups of individuals who exert some influence onthe “state” of the natural resources are permitted to move. Thelaw must always designate a body, whether one already inexistence or to be created, to coordinate management within theboundaries of the river basin.

With a view to drawing up a catalogue of laws on thissubject in force in Latin America and the Caribbean, the materialavailable at ECLAC and in the relevant bodies of the differentLatin American and Caribbean countries is currently beingreviewed. So far only a small part of the available material hasbeen examined. The information given below cannot therefore beconsidered representative for the whole region but neverthelesscasts light on the characteristics common to the reviewed lawsand those distinguishing them, as well as the aspects that wereconsidered in some but not in others.

Analysis of the content of the laws reveals that the mainfactors addressed are the following:

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(1)Frame of reference and policy (What subjects are governedby the law and what aims does it pursue?)

(2)Ownership (What is it whose management we wish to bepermitted or not permitted?)

(3)Management (How is it being managed?)(4)Agencies (Who coordinates what is managed?)(5)Tools (What working bases are used in order to be able to

manage?)(6)Participants (Who is involved?)(7)Financing (How are both the desired objects of management

and the mitigation of the adverse effects arising frommanagement to be financed?)

The point entitled “Frame of reference and policy” exploresthe considerations governed by the law and regarding which basicdeclaratory policies are pronounced.

The term “ownership” is understood to cover issues relatingto the use of natural resources, such as water rights,obligations associated with use, limits on use, violations of useand consequent penalties, expropriations and rights of way.

In relation to point (3) concerning “Management”, the lawstates how to proceed in the realm of administrative andtechnical management when we wish to manage the natural resourcesof a river basin. It stipulates that the first task is to defineshort-, medium- and long-term goals. The next task is then todesign, approve, apply, evaluate and refine coordination andimplementation tools.

The next point refers to the “agencies” empowered to applythe provisions of the law. These may be State agencies already inexistence or still to be created. In addition to enumeratingthem, it is also necessary to give a detailed description oftheir staffing and the specific functions to be carried out.

Under point (5) a description is given of the working“tools” necessary for accomplishing the assigned tasks. These maybe administrative tools (such as internal regulations) ortechnical ones. Use is made of basic tools (e.g. plans

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demarcating the boundaries of river basins, topographical mapsand land-use charts), secondary tools (e.g., the State WaterResources Plan of the State of São Paulo, Brazil, zoning plans,studies and hydraulic engineering works) as well as tools whichare highly specific to a particular region (such as the Inventoryand National Evaluation of Terraces and Traditional HydraulicWorks of Peru).

Users within the boundaries of river basins who influencethe natural resources situation or are engaged in studyingchanges in that situation are viewed by many laws as participantsin the management process. Such users may include municipalauthorities, individual citizens interested in the subject,associations of users of natural resources and universities.

The final point tackled, a point which should always go muchfurther in practice, is that entitled “Financing”. The forms offinancing encountered in the laws reviewed consist of thefollowing: financial funds (e.g. the State Water Resources Fundof the State of São Paulo, Brazil), rates of compensation for themaintenance costs of renewable natural resources, rates ofremuneration for services engaged in eliminating or controllingenvironmental degradation resulting from profitable activities,development taxes, funds provided under the national budget orthe budgets of administrative bodies allocated for such purposes,domestic or foreign loan capital, sponsorship by officialassociations of river-basin users, donations and reliefassistance, and penalties imposed on river basin users.

Not all the laws fit into the classification comprisingthese seven points. However, it is hoped that, as more and morelaws are studied, answers will be forthcoming to the question ofwhy this situation exists and the main points described here canbe verified or modified.

Legislation concerning the management of natural resourcesdeals with different levels of development and management. Usingfigure 6 as a basis for discussion, an endeavour has been made toclassify the Latin American and Peruvian Laws analysed. Table 9

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lists the laws with their titles and situates them within theframework established by figure 6. Table 10 presents a briefsummary of the main subjects covered by the laws.

Figure 6. Classification of laws relating to development-oriented managementof river basins

Laws onautonomous riverbasin corporations

Laws oninvestment and

the utilization ofnatural resources

Laws on theestablishment

of hydraulicengineering projects in

river basins

(a) (b) (c)(1-2)

“Preliminary” and

“Intermediate” stages

River basin Development

Natural resourcesdevelopment

Water resourcesdevelopment

(3)“Ongoing”

stage

Environmentalmanagement

Natural resourcesmanagement

Water resourcesmanagement

Watershedmanagement

Environmentallaws

Laws on mining,energy, wildlife,plant life, water,

etc.

Water lawsand codes

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Laws on river basinmanagement programmes

or projects

Source: Elaborated by Axel Dourojeanni, ECLAC, December 1993.

Table 9

Some laws and proposed laws on natural resources management onriver basins in Latin America and the Caribbean

Law ClassificationBrazil

Law No. 7663 of the State of São Paulo,establishing guidelines for the State Water ResourcesPolicy and the Integrated Water Resources ManagementSystem, of 30 December 1991 (published in Revista daSabesp, No. 166, July/August 1992, State of SãoPaulo)

3 (c)

Colombia Decree No. 2857, “Regulating part XIII, Title 2,

Chapter III of Decree-Law 2811 of 1974 on Riverbasins and establishing other provisions” of 13 October 1981

Accord No. 041, “Determining procedures andcompetences for the management of river basins”,agreed by INDERENA on 24 August 1983

3 (b)

River basinmanagement

Ecuador Waters Act, Supreme Decree No. 369 of 18 May 1972

(published in Official Register No. 69 of 30 May1972)

Regulations issued under the Waters Act, Supreme Decree No.40 of 18 July 1973 (published in Official RegisterNo. 233 of 26 January 1973)

Law No. 1111, decreed by the ConstitutionalPresident of the Republic on 20 August 1982

3 (c)

3 (c)

River basinmanagement

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Peru Supreme Decree No. 002-88/AG, decreed by the

President of the Republic (published in “ElPeruano”, 6 January 1988)

River basinmanagement

Dominican Republic Draft Water Code for the Dominican Republic,

prepared by Dr. Mario R. De Marco Naón(INDRHI/GTZ) (published as Report No. 66 by theNational Water Resources Institute in March 1992)

3 (c)

Uruguay Law No. 14.895, Water Code of 15 December 1978

(published in the “Official Journal of the EasternRepublic of Uruguay” on 11 January 1979)

3 (c)

Venezuela• Forestry Law of Soils and Waters of 14 December 1965(published in the “Official Gazette of theRepublic of Venezuela” on 8 January 1966 as SpecialNo. 997)

3 (b)

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Table 10

Main elements considered in laws relating to river basinmanagement

Main elements Treatment in the LawsFrame ofreferenceand policy

The State Water Resources Policy regards riverbasins as physical-cum-territorial planning andmanagement units (Brazil)

Regulations on river basins (Colombia) Defining of procedures and competences for the

“Management of River Basins” (Colombia) On water conservation and pollution ... with a

view to the protection and development of riverbasins (Ecuador)

Declaration of the public value of river basinprotection (Venezuela)

Ownership Expropriations and rights of way (Colombia,Ecuador, Uruguay)

Prohibitions and penalties (Colombia, Ecuador,Dominican Republic)

Water uses and priority (Ecuador, DominicanRepublic)

Awarding of surface-water and groundwater rightsfor different uses (Ecuador, Dominican Republic)

On the obligatory nature of irrigation (Ecuador) On ownership of water and limits and restrictions

on private ownership (Dominican Republic,Uruguay)

Management On river basin administration (Colombia) Execution, monitoring and evaluation of the

“Management Plan” (Colombia)

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Table 10

Main elements considered in laws relating to river basinmanagement

Organizational structure

River basin committees with members representingthe State Secretariat and Municipal Councils andUsers’ Associations (Brazil)

Administration of river basins by the NationalInstitute of Renewable Natural Resources and theEnvironment (INDERENA) or the RegionalDevelopment Corporations and in part by users’associations (Colombia)

Technical support group for river basinmanagement (Colombia)

Water directories (Ecuador) Irrigation and drainage commissions (Ecuador) National Standing Commission for River Basin

Protection and Management (Ecuador) National Commission for the “National River Basin

Management and Soil Conservation Programme”(Peru)

authority for application of the Water Code andwater tribunals (Dominican Republic)

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Table 10

Main elements considered in laws relating to river basinmanagement

Managementtools

Continuation... State Water Resources Plan (PERH) (Brazil) Integrated Water Resources Management System

(SIGRH) (Brazil) River Basin Management Plan (Colombia) Studies and works (Ecuador) Internal regulations for the operation of the

National Standing Committee for River BasinProtection and Management (Ecuador)

National River Basin and Management and SoilConservation Programme” (Peru)

National Inventory and Evaluation of Terraces andTraditional Hydraulic Engineering Works (Peru)

Hydraulic engineering works (Dominican Republic) Inventory and assessment of water resources and

administration of water-use rights (Uruguay) Protection and improvement works and preventive

measures (Uruguay)Participatio

n Participation by municipal councils, water users’

associations, universities, institutes of highereducation, fisheries and technologicaldevelopment agencies (Brazil)

Obligation to cooperate in the protection ofriver basins on the part of the public or privatebodies involved in the administration of waterresources; optional participation of users’associations (Colombia, Ecuador)

Advisory services for users (Colombia) Participation by users and their associations

(Dominican Republic)Financing State Water Resources Fund (FEHIDRO) (Brazil)

Financing of Management Plans (Colombia) Fees for the awarding of water-use rights

(Ecuador)

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(i) Establishment of the river basin agency

If the decision is taken in a country that water resources shouldbe administered by river basin agencies, a law is normallyproposed for their establishment. Such a law will assign itsareas to be administered and define the degree of its autonomywithin the politico-administrative hierarchy. The law will alsodesignate agents responsible for establishing the bodies andestablish time-limits for accomplishing this task. Theresponsible agents maybe State bodies and/or users of the riverbasin, since these will be the beneficiaries of the servicesprovided by the agencies. It is advisable to draw on users forthis purpose where they are motivated to make a river basinagency function well. In general, setting up a river basin agencywithout obtaining the prior agreement of some of the main usersis not to be recommended. This means that the river basinagencies will be established in a phased manner and only whenthey prove necessary. In no case should such agencies be set upmerely in a response to a decree covering the entire territory ifthe State lacks sufficient resources or if the users have nointerest in participating in their organization. Decrees or lawsestablishing river basin agencies must provide the basic minimumof support to the users of each river basin to permit theirestablishment. The State should not provide resources to users ifthe latter are not committed to a certain basic level of actionand financial contribution.

Given that the agency to be created will be one acting in adecentralized and participatory fashion, it is vital that stepsbe taken to verify that the legislation in force allows for theestablishment of such an agency. It is also essential to checkthat it will be compatible with the regional authorities. Inlocations with regional development authorities it is recommendedthat the agencies established be water agencies at the level ofriver basins rather than actual river basin agencies which couldcompete in operational and budgetary terms with the regionalauthorities.

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The law should also establish the form in which the wateragency of a river basin should coordinate its activities with theregional and municipal authorities.

The Mexican National Waters Act62 specifies in its ChapterIV on River Basin Councils that river basin agencies should beestablished in the following manner: “Article 13.—‘the Commission’, subjectto prior approval by its Technical Council, shall establish river basin councilsresponsible for coordination and liaison between the ‘Commission’, the branch officesand departments of federal, state or municipal authorities and representatives of theusers of the river basin in question with a view to the formulation and execution ofprogrammes and initiatives aimed at improved administration of the water resources,development of hydraulic infrastructure and the respective services and preservation ofthe river basin resources”.

Likewise, Law No. 7663 of the State of São Paulo, Brazil,63

in its title II on “State Water Resources Management Policy”,section II thereof on “Coordination and participatory integrationentities”, provides for the establishment of such entities.Article 22 states: “The following shall be established as consultative anddeliberative collegiate organs, at a strategic level, with jurisdiction, organization,competence and operation defined by the regulations issued under this Law: I.—theState Water Resources Council ... at the central level; II—River Basin Committees,operating through river basin units established by the State Water Resources Plan”.64

In the current preliminary draft of the revised Water Codeof Chile,65 the following is stated regarding the establishmentof river basin bodies: “Article 282 a.—River basins and watersheds shall beadministered in an integrated fashion, from the mouth of the river to its origins,through a body entitled “River Basin Administrative Corporation”, which shall have legalpersonality and be governed by the provisions of this Code and of Title XXXIII, Book I, of

62National Waters Act of the United Mexican States, 1 December 1992.63Law No. 7663 of the State of São Paulo, Brazil, establishing

guidelines for the State Water Resources Policy and the IntegratedWater Resources Management System, 30 December 1991.

64Translation from Portuguese into Spanish by the author.65Message No. 283-325 of the President of the Republic, Draft Law

amending the Water Code, 2 December 1992.

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the Civil Code, with the exception of articles 560, 562, 563 and 564. Its administrativestructures and internal operating regulations shall be established by a special statute.Such administrative corporations may be established for smaller units within riverbasins where deemed necessary for technical or administrative reasons, and all suchbodies may associate to form confederations where their interests so dictate”.

(ii) Organizational structure

The organizational structure of a river basin agency shouldconsist, at least, of a steering committee, composed ofrepresentatives of public authorities and users of the riverbasin, and a technical secretariat made up of a multidisciplinaryteam of experts.

Accordingly, Law No. 7663 of the State of São Paulo, Brazil,states the following in its article 24: “The River Basin Committee, inwhich the municipalities shall be represented on a basis of parity with the State, shall becomposed of: I—representatives of the State Secretariat ..., II—representatives of themunicipalities located within the corresponding river basins, III—representatives ofentities drawn from civil society located in the river basin, this category being confinedto a maximum of one third of the total votes: (a) universities, institutes of highereducation and fisheries and technological development entities; (b) users of the waterresources, represented by associations; (c) associations specializing in water resources,community associations and other non-governmental associations”.66

Moreover, the fifth paragraph of the same article states thefollowing: “The River Basin Committees may establish Technical Chambers of aconsultative character for the discussion of specific matters of interest relating to waterresources management”.67

In order to gear the composition of the river basin agencyto the specific local requirements of each river basin, the lawshould ideally regulate no more than the form in which itsrepresentatives are elected, rather than stipulating in detailthe composition of the river basin agencies to be established inthe country.

66Translation from Portuguese into Spanish by the author.67Translation from Portuguese into Spanish by the author.

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(iii) Functions of a river basin agency

Before defining the functions of a river basin agency, it isnecessary first to determine who actually administers the waterand how efficient they are in doing so. It is then necessary tosee how the reassignment of those functions or part of them toriver basin agencies could enhance the country’s administrationof water. In other words, not necessarily all the functionsrelating to water administration should be directly assigned toriver basin agencies. The important thing is to achieve a goodfit of the “new” agencies within the existing administrativesystem, avoiding functions being assigned several times over andendeavouring to ensure that river basin agencies are linked on aconsensual basis with the existing national, regional and localinstitutions dealing with the same area of activity.

(a) Coordinating function: The river basin agency should act asa “coordinating forum” for the administration of water resourceson the basis of a water-related and environmental approach. Thedegree of its executive power, whether in terms of rights orobligations, should be prescribed by law. In its work it shouldrespect the existing organizational and operational structures inplace for the administration of water resources, where these areoperating efficiently, and use them as a basis for management ofthe river basin. However, friction will doubtless arise betweenthose structures that have been administering the water on theirown account up to the present time and now have to adapt to theneeds of other users and to the rules established by law and bythe new forum.

(b) Administrative function: For the river basin agency to beable to discharge its administrative functions it is essentialthat the law require the formulation of internal administrativeregulations specific to each such agency.

(c) Assignment function: If the river basin agency isentrusted with assigning functions and responsibilities to otherentities or users or, in other words, with involving all theactors (administrative bodies and users) in its management, the

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law must define to which bodies precisely the river basin agencyis entitled to assign functions and what type of functions areconcerned. In order to involve the users, their participation inwater management must be foreseen and permitted by thelegislation in force because, quite clearly, not all the actorsshould be made subject to the discretion of a river basin.

Article 27 of Decree No. 2857 of the Colombian Ministry ofAgriculture68 states the following: “Cooperation for the protection of riverbasins. The public or private entities responsible for the administration of aqueducts,irrigation districts, hydroelectric plants, enterprises engaged in the processing ofnatural resources and, in general, any agencies which directly or indirectly exploit theresources of a river basin shall be obliged to cooperate in their development and tocontribute in both technical and financial terms to the protection of the renewablenatural resources and of the environment”.

(d) Advisory function: On the basis of its coordinatingactivities, the river basin agency will be called upon to providetechnical, scientific and political advice to other entitiesinvolved and to users requesting such advice, and to undertakespecific studies. To enable it to fulfil this requirement, thelegislation must require the formation within the organizationalstructure of a group of experts from the most varied disciplines(lawyers, economists, hydrologists, engineers, teachers, etc.)who must have access to water-analysis laboratories, flowmeasurement apparatus, infrastructure for installing geographicalinformation systems, data banks, libraries, and so forth. Thisgroup of experts will constitute the so-called “technicalsecretariat”.

An essential part of the advisory function is to assist thebody responsible for awarding water-use rights in its decisions.The legislative branch must accordingly formulate in its water-resources legislation water-use priorities for the differentsectors and define whether water is the exclusive property of the

68Decree No. 2857 of the Ministry of Agriculture of the Republic ofColombia “Governing part XIII, Title 2, Chapter III of Decree-Law 2811of 1974 on River Basins and establishing other provisions”, 13 October1981.

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State or whether it may also constitute private property.Conflicts may arise from changes sought in water rights awardedin the past and also from the disregarding of common-law rightswhich, albeit not codified, are considered in many regions to bedecisive in relation to water use.

(e) Monitoring function: In order for the river basin agencyto be able to monitor the watercourses of the river basin fromits origins, along its entire length and in all its uses, it isimperative that the law should establish water quality andquantity standards providing a legal framework for the monitoringof compliance. The water quality standards should comprise thefollowing:

Quality standards applicable to water supplied to users fordifferent uses (drinking water, water for irrigation, waterfor industrial use);

Standards regarding the limits on contaminants in the waterreturned by the user to the water cycle (maximumconcentrations per element, total maximum concentrations,absolute quantities returned).

Observance of these standards demands that Latin Americanlegislation should increasingly require the construction ofwaste-water treatment plants and the installation of filters tocut down industrial emissions into the atmosphere, since thesehave a major impact on water quality. Moreover, it is of greatimportance for the conservation of freshwater reserves that thelegislation should also establish drinking water protectionzones. Each of these zones should have its own regulationsgoverning the types of land use permitted and the maximumquantities of fertilizers and pesticides that may be used.

The water quantity standards deal with the quantities thatmay be extracted from surface waters and groundwaters and theform in which they have to be returned to the water cycle over aperiod of time.

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The standards and regulations will only be enforceable ifprovision is also made for sufficient penalties in the event ofnon-compliance. Such control measures will only be effective if“whoever exercises authority in water-related matters or control over the execution ofhydraulic engineering works may enter any public or private premises upon priornotification in order to discharge the functions arising from this Code”, as statedby article 338 of the “Draft Water Code for the DominicanRepublic” of 1992.69

(f) Arbitration function: Since the river basin agency is acoordinating entity with a participatory style of administration,it is felt that it would also be the most appropriate body toassume the role of arbitrator in conflicts arising between theactors. The law should accordingly require the establishment ofan “arbitration commission” as envisaged in the same Draft WaterCode for the Dominican Republic cited above, which states thefollowing: “Article 339.—Magistrate’s courts shall be empowered to act as WaterTribunals with the task of hearing and pronouncing on all matters related to this Codeand regulations issued thereunder.” Article 340 continues as follows:“The competence of such Water Tribunals shall also include thefollowing matters: (a) ownership of waters, watercourses andriver banks; (b) rights of way and restrictions on ownership;(c) rates of compensation payable, unless otherwise agreed atadministrative headquarters; (d) damages; and (e) challenge ofenforceable administrative decisions which have created rights ofthe individual.”

(iv) Management tools

The tools used in managing water resources are as many andvarious as the sectors connected with water in some form orother. The following are some of the tools concerned:

69Instituto Nacional de Recursos Hidráulicos (INDRHI)/DeutscheGesellschaft fuer Technische Zusammenarbeit (GTZ), “Draft Water Codefor the Dominican Republic (version revised and modified by theComisión Nacional de Aguas Públicas)”, Report No. 66 forming part ofthe project “Strengthening the INDRHI in water-related activities”,March 1992.

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Technical (such as hydrometeorological and water-qualitymeasurement networks, registers of users and assigned waterrights);

Economic (such as rates charged for use of waterand penalties for its misuse);

Political (such as assignments of water-use rights); Educational (such as publicity campaigns and environmental

instruction in schools, colleges and universities); and Planning (such as river basin management plans).

Not all these management tools are intended to be directlyapplied by the river basin agency. Many will be used by otherentities entrusted with the corresponding functions. Theimportant point is that the legislation should ensure access bythe river basin agency to all data of any kind arising from theuse of the management tools, including those which it does notuse directly itself.

In many countries, such as Brazil, “river basin managementplans” are considered basic tools for directing the management ofriver basins.

For instance, in Law No. 7663 of the State of São Paulo,Brazil, article 17 provides for the formulation of “river basinplans” which must include the following:

General guidelines, at the regional level, for the orientationof municipal and other management plans in the sectors ofurban growth, industrial localization, mineral prospecting,irrigation and sanitation with due regard for the exigenciesof water resources conservation;

Definitions of short-, medium-, and long-term goals expressedin the form of: priority-use plans, annual and pluri-annualrecovery, protection, conservation and utilization programmesin relation to the water resources of a river basin, withdetails of the required funding and integrated regionaldevelopment programmes;

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Adjustments to regional programmes in the light of thespecific conditions of the respective river basins.

Decree No. 2857 of the Colombian Ministry of Agricultureprovides for the formulation of a “management plan” forindividual river basins. The contents of such plans are definedas follows in article 13: “Contents. Each management plan shall comprisethe following stages: (a) analysis (of the physico-geographical and infrastructionalbaseline situation); (b) formulation (of the river basin management plan); (c) execution(of the policies, programmes and projects set forth in the plan); and (d) monitoring (ofthe programmes and projects in the course of execution).”

In Spain, the need has likewise been perceived for theformulation of so-called “river basin water plans” (see box 19).A more detailed discussion of this area can be found in thispaper in the section on planning systems.

Box 19

Water planning in Spain While water is indeed a valuable assetwhich is vital for all human activityand has to be subject to the generalinterest of the nation, as soon as it isto be considered public or Stateproperty it is logically up to itsadministrator, the State, to plan itsuse and establish standards of qualityin order best to meet individual andcollective needs.

What are the objectives pursued throughwater planning?

The Spanish Waters Act provides for thefollowing:

Icreasing the availability of water; Protecting its quality; Rationalizing water uses with due

regard for long-term environmentalconsiderations; and

Ensuring greater satisfaction of theSpanish population’s demand for water.

What do river basin water plans consistof?

The Act establishes the followingpoints: The water resources inventory; Water uses and demands, both present

and forecast; Criteria for assigning priorities and

reconciling different water uses,together with an order of priorityamong the different uses and deve-lopment initiatives;

The assignment and storage of waterfor current and future uses anddemands and for the purposes ofenvironmental conservation orrecovery;

Basic water quality criteria; Organization of the dumping of waste-

waters; Basic standards relating to land

improvement and its conversion toirrigation land;

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What means are employed to implement waterplanning?

River basin water plans, and The National Water Plan.

These plans are public and binding or, inother words, mandatory for all, i.e. forthe State and the AutonomousCommunities, for other corporations andpublic bodies, and between privatebodies and private individuals.

The river basin water plan is abasic tool for achieving the rationalutilization of water resources. It isconstituted by the relevant river basinauthority or by the WaterAdministration of the AutonomousCommunity in cases where the riverbasin is wholly contained within theterritory of a single AutonomousCommunity. It is subject to governmentapproval.

Protection zones and measures aimedat the conservation and recovery ofwaters and their surrounding areas;

Hydrological-forestry and soil-conservation plans established by theAdministration;

Guidelines for the recharge andprotection of aquifers;

Basic infrastructural requirementsunder the Plan;

Criteria relating to studies,engineering works and other activitiesaimed at preventing and avoidingdamage due to flooding, high waterlevels, and other such phenomena.

The Act also establishes that the waterplans shall have the requisite forceto:

Establish water and land reserves asrequired for the envisaged activitiesand works; and

Declare certain specially protectedzones, river basins, stretches ofriver, aquifers or water bodies inaccordance with their natural featuresor ecological value.

Source: Ministry of Public Works and Town Planning (MOPU), The Water Book. Guide to theWaters Act, Madrid, 1985

(v) Financing of a river basin agency

For a river basin agency to function properly it is of cardinalimportance that the law define a framework for its financing. Thebasic legal principles applicable here include the charging ofrates in accordance with the use of the resources and land withinthe river basin, the charging of rates in accordance with thevalue of property or the charging of rates for water use, as wellas the “polluter pays” principle. The charging of rates for useand penalties for misuse must be covered by the water resourceslegislation. Decree No. 2857 of the Republic of Colombia offers awide spectrum of possibilities for financing the implementationof plans in the charge of a river basin agency, one of its maintools. Article 30 of this Decree, on “Financing of managementplans”, states the following:

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“The management plans of river basins shall be financed from the followingresources:

1. From the sum of the charges levied for the compensation of the costs ofmaintaining renewable natural resources,

2. From the sum of the remuneration rates charged for services to eliminateor control environmental degradation due to profit-making activities,

3. From the sum of the development taxes collected by the administrativeauthority for renewable natural resources,

4. From national budgetary funds and the budgetary resources ofadministrative bodies earmarked for such purposes,

5. From the sum of the domestic or foreign loans contracted by theGovernment or the administrative authority for renewable natural resources,

6. From the sum of the contributions by official entities representing the riverbasin users,

7. From the donations and relief assistance furnished to the administrativebody for renewable natural resources by individuals and corporations at home andabroad,

8. From the sum of the fines imposed on users of the river basin forinfringing the prohibitions established by this Decree”.

For the financing of the river basin agency to operateproperly, the relevant legislation needs to provide clear answersto the following questions: Who will be responsible for chargingfor use? How high will the tariffs and penalties be set? Who willmanage the funds accruing? Who decides how the fund money shouldbe used? The following section explores this subject in greaterdetail.

The legal framework necessary for a river basin agency to beable to operate efficiently must be far more flexible andspecific than may perhaps be suggested by the above and must betailored to the different kinds of river basin agency withspecifically assigned functions geared to the particular needs ofeach country.

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C. Financial basis

(i) Conceptualization

In this section a number of alternatives are presented forfinancing bodies in charge of the ongoing phase of river basinmanagement (table 1) directed towards the management of waterresources, natural resources or the environment. The umbrellaterm of “river basin agencies” covers all these entities in theirwidely varying forms, forestry and soil services and any otherservice engaged in the management of the natural resources of theriver basin being considered part of this system.

The intermediate management phase, devoted to the executionof “development” projects, is usually financed from the fundsallocated to the actual projects implemented by the river basinagency so that it normally has adequate funding for itsoperation. Some of these agencies, such as the river basincorporations in Colombia, have developed further and have alsobecome agencies responsible for the ongoing management of waterand other natural resources.

The purpose of a river basin management agency should beseen within the context of the function of the State ofsafeguarding the nation’s natural heritage. An entity of thistype may be public or private in character and may vary in thelegal status it adopts, but must, as an absolute necessity,operate efficiently and effectively and serve its users, while alsoensuring compliance with national legislation on the environment and conductingits management with the participation of the other actors, including themunicipalities present in the river basin.

A river basin management agency normally appropriates forits funding part of the economic revenue generated by exploitingthe natural productivity of the region’s natural resources. Thesize of the revenue depends partly on the biological and physico-chemical propensity of the natural resources to increase their

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biomass and to maintain their life cycle under naturalconditions. For example, the harnessing of hydroelectric energyis simply the appropriation of a natural resource. The more“developed” the type of use of the river basin’s naturalresources, the easier it will be to obtain funding. For example,if a hydroelectric power plant has been constructed on a riverbasin it is easier to collect a percentage of the revenuegenerated through the sale of power than if the plant did notexist. This explains why the better funded river basin agenciesallocated in river basins which have received major investments(such as the South Florida Water Management District in theUnited States). However, in river basins lacking such majorinvestments, occupied by peasant communities whose mainoccupation is tree felling and burning, it is well nighimpossible to obtain any income.

From the theoretical point of view, payment for the use ofthe resource should not detract from the soundness of thecapitalist production calculation nor distort the formation ofprices of goods produced in the river basin. Since water is afactor of production, its use must be reflected in real terms inproduction costs. Otherwise, its long-term development isrendered impossible as a result of gradual and ultimately totaldepletion.

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(ii) Sources and applications of financing

River basin bodies require stable and ongoing financing. Itsresources are normally harnessed according to the use made of thewater and the land and the availability of other sources ofpublic funding (see box 20).

Box 20

Financial resources of the Bogotá water systemThe Regional Autonomous Corporationof the Bogotá, Ubaté and Suarezrivers (CAR) was established in 1961to promote the development of itsarea of jurisdiction. The mainsource of the Corporation’s incomeis the national tax on real estatewithin its area of jurisdiction,which was fixed on 1 January 1984 bynational law as 2.5 per mille on theregistered value. In order for theCorporation to carry outconstruction works such as thoserelated to the Bogotá river, fundingis obtained under the nationalbudget, although this has formed aminor proportion of theCorporation’s income. TheCorporation also has the option ofdrawing on additional sources offinancing in the form of developmentsubsidies, fees for its services andfines.

Income

The Corporation’s income in1985 amounted to $2,180 millionColombian pesos at the current rate(approximately US$ 11.5 million atthe prevailing dollar rate for thefinal quarter of 1985). Broken downin percentage terms, its income in

Costs and investment

During the period from 1962 to1984, the Corporation’s annualadministrative costs fluctuatedbetween 11.2 per cent and 10.45 percent of its income; investmentfluctuated between 58 per cent and83 per cent of total costs; theremainder represents the operatingcosts. Investment expressed as aproportion of income fluctuatedbetween 41 per cent and 87 per centper year. Investment funds wereallocated as follows: 46 per centfor infrastructural works; 33 percent for water management andpollution control; 12 per cent forsoil and wildlife management; 8 percent for other programmes; and 1 percent for land-use planning.Contributions have been forthcomingfrom the beneficiary communities andmunicipalities for the execution ofinfrastructural works. TheCorporation’s expenditure in 1985was $2,243 million Colombian pesosat the current rate, of which 81 percent corresponded to investmentcosts, 15 per cent to operatingcosts and 4 per cent to debtservicing.

The Corporation’s objective in

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1985 consisted of its own resourcesin the proportion of 90 per cent,together with 5 per cent provided bycontributions from other entities,4 per cent from credits and 1 percent from national treasury funds.The tax of 2.5 per mille in 1985brought in a total of $1,278 millionColombian pesos at the current rate.Recently decisions have been adoptedfor the distribution of developmentsubsidies in respect of specificstructural works.

the area of financial management isto improve the sources of fundingavailable to the region in order toachieve adequate levels for thepurposes of regional development.The strategic aims assigned to it are tostrengthen municipal autonomy inaccordance with the level of development ofeach municipality and to foster joint activitieswith the territorial departments with a viewto providing appropriate training formunicipal officials in the realm of budgetarymanagement.

Source:

United Nations, Economic Commission for Latin America and theCaribbean (ECLAC), “La gestión de los recursos hídricos en AméricaLatina y el Caribe”, Estudios e Informes de la CEPAL 71, LC/G.1523-P,Santiago de Chile, April 1989.

In order to be able to finance a river basin agency responsible foradministering multiple use of water, the most logical course is to charge for useof the water (see box 21 and figure 7). However, this is not always theeasiest course, especially in the initial stages beforesatisfactory measurements have been made. Consequently, recourseis made to other sources of income, such as land or real estatetaxation.

Box 21

Financing of water agencies inFrance

Under a law dated 16 December 1964,Metropolitan France is divided intosix major river basins in accordancewith the natural watersheds. One ofthe three principles according towhich French river basins operate is

Part of it is redistributed in theform of loans or subsidies to anyperson conducting operations in thecollective interest with a view tothe development of the waterresources or improvement of their

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that of incentive, meaning thatusers are required to pay apredetermined tariff in accordancewith the quantity of water withdrawnand the level of pollution caused.In practice, this amounts toapplication of the “polluter pays”principle (see explanation of importof this principle elsewhere in thispaper).

How is this principle appliedin practical terms? Each of theabove-mentioned river basins hasassigned to it a “financial” riverbasin agency (currently referred toas “Water Agencies”), which aredecentralized public establishmentswith financial autonomy (establishedin 1967 or 1968, depending on theriver basin in question). TheAgencies are funded by subscriptiondues paid by users, the amounts ofwhich are proportional to thequantities withdrawn or consumed,the levels of pollution of thereturned waters or their impact onthe environment. After consultingthe River Basin Committee, eachWater Agency establishes the amountof the dues payable in accordancewith priorities set for theparticular river basin.

Part of the fund is allocatedto studies and research inconnection with the agency’soperation and the measurementnetwork.

quality within the framework of theprogramme drawn up by the WaterAgency. The Agency collects anddistributes funds to contractorsengaged in conducting structuralworks in the collective interest,local communities (municipalities),farmers and industrial enterpriseswith a view to improving the use ofthe water and its treatment. TheWater Agencies accordingly share outthe amounts collected by providingassistance to the municipalities andto industrial and agriculturalconcerns, thus enabling them tocarry out the works required topreserve the “water” resource andprotect the aquatic environmentwithin the framework of the Agency’sprogramme.

The six river basin agencieshave had at their disposal thefollowing budget: from 1987 to 1991,a total of 3,200 million dollarsgenerating works in the value of9,000 million dollars. Between 1992and 1996, works valued at 16,200million dollars were generatedwith an investment of 7,000 milliondollars. The 1993 budget is in theregion of 2,000 million dollars.

These funds were allocated tohousehold pollution control, watersupply, industrial pollutioncontrol, improvement of watercatchment, agricultural pollutioncontrol and improvement of riverwatercourses.

Source:State Department of the Environment under the Prime Minister, Water.French Technology, “Label France” Collection, paper prepared by theInstitut des sciences et des techniques de l’équipement et del’environnement pour le développement, Paris, France; and Ministry ofthe Environment, Water, a common heritage. Integrated development andmanagement of drainage basins. The French approach, paper prepared for the

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United Nations Conference on Environment and Development, Rio deJaneiro, June 1992.

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Figure 7. Schematic presentation of the financing of FrenchWater Agencies

Source: Ministry of the Environment, Water, a common heritage.Integrated development and management of drainage basins. The French approach,paper prepared for the United Nations Conference on Environmentand Development, Rio de Janeiro, June 1992.

Charging for the use of water is the option that presentsthe greatest challenge and is therefore examined in greater

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Localcommunitie

s

Water Pollution

Autonomous AgencyBudget of the WaterAgencyAdopted by the Administrative Board subjectby the river basinFive-year

DirectAgenc

Studies andresearch

Operation

Measurementnetwork

Contractors,development

Financialassistance

Industry

Farmers

detail below. Charging for water fulfils two functions: itprovides an effective means of securing funds; and, it provides ameans of ensuring that water is used properly.Firstly, charging for the use of water is aimed at generating income which willultimately be used to finance programmes aimed at achieving a balance betweenwater supply and demand, in both qualitative and quantitativeterms.70

Secondly, charging for the use of water should act as an incentive for users toadopt technologies and procedures making for more efficient use, reducedlevels of loss and encouraging changes in individual patterns ofconsumption. It should also encourage efforts to maintain waterquality standards through the treatment of waste-waters,technological improvements in production processes and thereversal of land degradation trends.

(iii) Economic tools for securing income

Funding for the management of a river basin agency is securedthrough so-called “economic tools” such as taxes, tariffs, credittransfers, donations, quotas, exemptions, and the like.

As the economic value of water is associated with its opportunity cost andavailability, logic dictates the implementation of a flexible systemfor securing income. The price of water may also vary inaccordance with its opportunity cost and its physical presence inthe river basin, with different prices being established fordifferent uses according to changes in quality and quantity(depending on the season and extreme hydrological conditions,whether favourable or unfavourable).

The main pillar of support for financing a river basinagency is the financial fund, which will normally be made up ofcapital derived from the different productive activities in thearea of the river basin together with other, external sources.

70João Gilberto Lotufo Conejo, “A outorga de usos da água comoinstrumento de gerenciamento dos recursos hídricos”, Revista de AdministraçãoPública, April/June 1993, Volume 27.

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Brazil has vast experience in the establishment of such funds(see box 22).

The financial fund to be administered by a river basinagency is set up for the purpose of pooling the proceeds frompayment for water use and for services provided to users. Thechannelling of financial resources into a fund accords with theeconomic properties of water described above. It should also makeit possible to maximize the social benefits yielded bycoordinated management of the future applications of thefinancial resources, thereby leading to economies of scale,simplified administrative procedures and expenditure control.

The river basin agency should thus be the entity responsiblefor administering a financial fund potentially made up of capitalderiving from the following:

State, regional and municipal contributions stipulated by law; Transfers or contributions of funds earmarked for the

execution of water resources plans and programmes in thecommon interest;

Financial compensation for the use of hydroelectric powerproduced in the river basin;

Proceeds from the charges levied collectively and individuallyfor the use of water resources;

National and international credits; Non-reimbursable funds from international aid and cooperation

and intergovernmental agreements; Direct payment by the users of water on the river basin for

services provided by the agency; Yield from credit transactions undertaken by the agency on

behalf of State and local government organizations and bodies,concessionaries of public services and private bodies;

Income from the applications of fund capital (interest onloans provided against the funds of the users themselves);

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Proceeds from the collection of fines imposed on river basinusers in conformity with the legislation in force;

Capital deriving from donations by individuals orcorporations, whether public or private; occasional and otherincome.

The charging instruments available for use by the riverbasin agency include collective and individual instruments, aswell as taxation and self-regulation. The collective instruments areused in charging for the withdrawal of water (quotas) by majorconcerns which harness and use the water (hydroelectric powerand drinking water enterprises). Enterprises engaged in thesupply of water are those responsible for charging for individualuse of the supply system. The mechanism to be instituted consistsin transfers, which have to be regulated by law and have tocorrespond to a percentage of the gross sales of the drinkingwater and hydroelectric power companies.

The individual instruments are applied in the direct charging ofindividuals or corporations requesting use of the river basinwater, whether surface water or groundwater. Generally speaking,a specific rate is applied for water use and the capital thusflowing into the fund is then used in order to cover the costs ofprotecting and renewing the water resources.

The taxation instruments are land taxes or rates charged by theState for use of the land in the river basin, whetheragricultural property, mining concessions, commercial orindustrial establishments, residential settlements or land usedfor other purposes. The capital yielded is transferred in the formof an annual percentage through the year, as agreed by theparties concerned. The river basin agency may use the capital to,say, operate and maintain flood-control infrastructure throughoutthe river basin or to monitor water quality.

Self-management and self-financing are the normal mechanism foradministering water locally. In the region such systems areoperated by the indigenous High Andean communities. Works areexecuted mainly by means of manual labour and with meagre

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financial assistance. Self-management and self-financing areessentially arrangements used for the management of drinkingwater and for irrigation.

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Box 22

Financing for the management of water resources in the state ofSão Paulo

With the promulgation of Law No.7663 on 30 December 1991 it wasestablished that all funds earmarkedfor the management of waterresources should be channelled intothe newly constituted State WaterResources Fund (FEHIDRO), intendedas a means of improving theprocedures applied in the financingof water policy, whether from thepoint of view of transparency in thediscussion of this public issue orbecause of quantitative features.

Features of FEHIDROThe framework laid down by Law

No. 7663 for FEHIDRO is largelymodelled on traditional financialfunds but also has some additionalinnovative features. One of the mostusual features of the Fund is theexistence of a Steering Boardcomposed of members of the StateWater Resources Board, in whichparity is maintained betweenrepresentatives of regional andlocal government. From the point ofview of financial administration,the Fund resembles any officialcredit institution.

No innovations have beenintroduced with regard to the sourceof the capital, but its application,however, does display innovativefeatures. In the first place, it wasestablished that only 10 per cent ofthe total proceeds may be used tooffset current expenditure, the mostsubstantial item in this regardnormally being expenditure on

One of the most usual features ofthe Fund is the existence of aSteering Board composed of membersof the State Water Resources Board,in which parity is maintainedbetween representatives of regionaland local government. From the pointof view of financial administration,the Fund resembles any officialcredit institution.

No innovations have beenintroduced with regard to the sourceof the capital, but its application,however, does display innovativefeatures. In the first place, it wasestablished that only 10 per cent ofthe total proceeds may be used tooffset current expenditure, the mostsubstantial item in this regardnormally being expenditure onpersonnel contracts. All remainingcapital must be used to fund activities associated withspecific and infrastructuralprojects.

Source of FEHIDRO capitalThe traditional sources of capitalearmarked for the management ofwater resources are budgetarytransfers, an arrangement which issubject to various forms ofdistortion but continues for thetime being to provide the mainsource of funds.

As a result of the fiscalcrisis undergone by the State, theConstitution of the State of SãoPaulo, with effect subsequent to Law

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personnel contracts. All remainingcapital must be used to fundactivities associated with specificand infrastructural projects.

With the promulgation of Law No.7663 on 30 December 1991 it wasestablished that all funds earmarkedfor the management of waterresources should be channelled intothe newly constituted State WaterResources Fund (FEHIDRO), intendedas a means of improving theprocedures applied in the financingof water policy, whether from thepoint of view of transparency in thediscussion of this public issue orbecause of quantitative features.

Features of FEHIDROThe framework laid down by Law No.7663 for FEHIDRO is largely modelledon traditional financial funds butalso has some additional innovativefeatures.

No. 7663, endeavoured to introduceother financing instruments. Itplaces particular emphasis on so-called “payment for the use of water”,thus seeking to obtain more rationalmanagement.

Article 211 of the StateConstitution specifies that the useof water resources shall be subjectto charges levied for the purpose ofsafeguarding, inter alia, the rationalutilization of water resources andgiving priority to public watersupply; multiple use of water andinfrastructural works; protection ofbasins fed by sources or springs;and decentralized management. Withthis in mind, it is sought in thelong term to reduce the State’sshare in the coverage of directcosts and to obtain new sources offunding by charging the users of theriver basin in question.

Source:

Paulo Cesar Vaz Guimarães, “Financiamento para gestão dos recursoshídricos no Estado de São Paulo”, Anais do X Simpósio Brasileiro de Recursos e 1o

Simpósio de Recursos Hídricos do Cone Sul, Associação Brasileira de RecursosHídricos, Brazil, 1993.

D. Social basis

The management of river basins, especially water, is essentiallythe management of conflicts. However, it is not so much themanagement of environmental conflicts as that of conflictsbetween individuals competing to occupy space and obtainresources which affect their relationship with the environment onwhich they depend.

From this perspective, there is no such thing as“environmental problems”. Instead, what we have are humanproblems which are manifested as changes in the environment ingeneral and as an incapacity to combat extreme natural phenomena.

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In practice, this is due to an insufficient or non-existent capacity to managehuman activities in relation to the environment. Human beings, acting inan uncoordinated fashion, intervene without a sufficientunderstanding of the effects of their action on the environment,compete with one another rather than reconciling their interestsand fail to engage in research or invest in the necessaryadvanced technology to find out about their environment andmanage it properly.

One way of avoiding these conflicts is to encourage negotiations ordealings between the actors who are mutually affected by their actions in relationto the environment. In order to achieve this it is necessary in thefirst place to establish who these actors are, how they think andwhat activities they pursue, how their non-conformity manifestsitself, what situation they would desire, in what territory theirinteractions take place and what specific situations they need todeal with. In the second place, they have to be supplied withinformation on the potential of the area in which they areactive, the obstacles to be overcome, a package of alternativesolutions and strategies for doing so and specific programmes forexecuting the chosen strategies.

In this entire process it is necessary to have preciseinformation on the existing environmental situations and theactors involved in each one in order to encourage clear dealingsand relations between them. This means not only dedicating greatefforts to finding out what is happening in and to theenvironment but also establishing relations with each of theactors involved. In areas such as river basins it is possible toencourage dealings between the actors who affect each other,especially through the water system.

The actors involved in a river basin management system forma network of great variety and complexity. The conventionalsocio-economic approach to the classification of actors does notprovide a sufficient basis for identifying them, and a morespecific typology is called for. One typology of actors which hasproved successful in improving river basin management systemsadopts the following criteria for categorization:

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Level and orientation of management by the actors in the riverbasin,

Formal or informal character, in legal terms, of their actionsin relation to the river basin,

Endogenous or exogenous relationship of the actors to theplace where they are based and take decisions affecting thedynamics of the river basin, and

Public or private character of the actor.

With regard to the first criterion, four levels and orientations can bediscerned on river basin management, as described below (see figure 1).

The first level of management (scientific and environmental) is usuallyundertaken by groups or organizations in the public or privatesector engaged in water resources research and made up of expertsdirectly engaged in work on the natural environment, such ashydrologists, geologists, hydrogeologists, meteorologists,ecologists, biologists and geographers. These professionals arein charge of scientific studies and research on water, associatednatural resources and the environment in general, and are alsoresponsible for providing basic information on the functioning ofecosystems and the potential of the natural resources present inthe area under study.

The second level of management (economic and productive) is generallythe responsibility of individual users, normally in the shape ofenterprises and other forms of organization devoted to waterdevelopment, which are, in effect, the direct users of the waterand associated resources. They consist of private, State or mixedcompanies of a sectoral character such as drinking-water,sanitation and mining enterprises, municipalities, irrigators’associations, hydroelectric power producers, fish-farmingenterprises, and the like.

Managers at this level generally act on an individual basiswhen intervening in shared water systems. This means that everyactor who regulates, withdraws, utilizes water or returns it tothe water system may do so without heed to the consequences for

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the other users. This happens because the third level ofmanagement, described below, either fails to fulfil its role oris non-existent.

The third level of management (technical and regulatory) is thatwhich, by definition, should direct and regulate managementprocesses with a view to the integrated management of waterresources and multiple water use (supply-demand equilibrium), aresponsibility which normally rests with the State. It may happenin some cases that, in the absence of this technical andregulatory State function, the economic and productive level willopt for self-regulation and establish its own norms of jointoperation. This will usually only happen in shared water systems,such as canals and rivers, and will not take place at thenational level.

This level comprises the national water boards anddepartments of water resources as well as entities responsiblefor the control of extreme natural phenomena (droughts andflooding) and for mitigating the effects of adverse environmentalconditions on man, such as water pollution.

In theory, the State should lend its assistance with a viewto coordinating the activities of entities in charge of water supply tomultiple users; monitoring the external effects of water use forthe purpose, in particular, of avoiding its pollution; investingin structural works with diminishing economies of scale; andundertaking the long-term planning of major hydraulic works inthe collective interest.

One of its main tasks is to ensure protection of theenvironment and of users and to prevent the misuse of water andthe areas where it circulates and where it is captured, such asriver basins, aquifers and groundwater reservoirs, river channelsand atmospheric waters.

The private, public and mixed user sectors must be involvedin the coordination and execution of the technical and regulatorytasks since they are the sectors benefiting from them. Thus, in

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the case of shared water systems, it is necessary to work jointlywith the economic and productive groups.

The fourth level of management (political and social) has to beundertaken by high-level advisory groups such as professionalassociations, higher councils or water boards of a country orregion. These bodies should be vested with officialresponsibility for directing water development policies inaccordance with national or regional development plans. Theadvisory groups must be composed of legally elected politicalrepresentatives, ministerial delegates, chairmen of professionalassociations, spokespersons from users’ associations andenterprises, scientists and other such persons. In some Europeancountries, these committees are termed “councils”, as in the caseof Spain, whose Waters Act provides for the establishment of aninstitutional body of this kind to assist the administration ofwater resources (see box 23).

In the absence of a higher water association or board, thereis no agency responsible for directing the development of waterresources in accordance with the country’s development goals (forexample, by guiding investments in hydraulic works in a mannerconducive to the achievement of these goals) or, conversely, fordirecting national development in accordance with theavailability of water resources (for example, by encouraging thelocation of industries with a high demand for water in placeswhere it is most abundant). Where there are no such high-leveladvisory bodies, it is not possible to provide assistance to theactual users to enable them to coordinate their activities and,in the event of conflicts among them, there is no entity capableof settling them or providing the tribunals with the necessarytechnical reports for deciding on specific situations.

In order for water management to be effective, all four levels of actionneed to be duly coordinated. The interrelationship between levels andareas of management provides the basis for the structuring of awater management system at the national level (see box 24 andfigures 8 and 9).

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The second category refers to the legal character of land occupation withinthe river basin and the assignment of rights to the use of the natural resources.Within this category the actors may be either formal or informal.This is of great importance in determining the most appropriatetype of organization for the coordination of initiatives in thebasin. In theory, any of these categories may be totally orpartly present in a river basin.

A system of classification in which all or most of the riverbasin inhabitants are of the “informal” type means that they usethe natural resources of the river basin without possessingproperty titles or being settled there in a traditional sense. Inpractice, these are “precarious” occupiers of the lands orsquatters, a frequent phenomenon in various tropical areas of theregion.

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Box 23

The National Water Council of Spain

Spain’s Water Act provided for theestablishment of the National WaterCouncil. What is the National WaterCouncil and what function does itserve?

If water is a scarce andprecious commodity, it calls forplanning. Since water planning isundertaken by a number of differententities which may have differentpoints of view, a central body toprovide advice and coordination isrequired. This body is therefore thehigher advisory body in the area ofwater and its function is thus toinform and advise, rather thanlegislate or execute; specifically,it has an obligation to provideinformation on the following:

The draft National Water Planprior to its approval by theGovernment for transmission tothe courts;

The river basin Water Plansprior to their approval by theGovernment;

Draft provisions of a generalnature referring to themanagement of publicly ownedwater resources;

Plans and projects of generalinterest relating toagricultural, industrial andenergy-generation planning or toland use affecting hydrologicalplanning or water uses;

Issues of joint concern to two ormore river basin agenciesconcerning the development ofwater resources and other publicwater-related assets.

In addition, when the Government orhigher executive organs of theAutonomous Communities consult it onmatters relating to publicly ownedwater-related assets, the NationalWater Council will issue a reportthereon.

Finally, the Council maypropose to the governmentauthorities and public bodiesavenues of research with a view tothe development of technologicalinnovations for improving thecapture of water, its applications,conservation, recovery andintegrated treatment, as well as thewater economy.

How is the Council composed?It comprises representatives of thefollowing: The national Government; The administrations of the

Autonomous Communities; The river basin agencies; and

The most representativeprofessional and economicorganizations at the national levelconcerned with water uses.

Source:Ministry of Public Works and Town Planning (MOPU), The Water Book. Guideto the Water Act, Madrid, 1985.

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At the other extreme, one would find human settlements andoccupants of lands with legal property titles or “formal”occupants, this generally being the case in more developed riverbasins in terms of water utilization, basins that are moredensely populated and contain major towns and cities, industries,agricultural estates, forestry operations and stockbreedingfarms.

At an intermediate level, one might find river basins thatare totally or partly settled by indigenous and peasantpopulations which, while not always possessing legal title,nonetheless have an ample knowledge of their environment, theheritage of hundreds or thousands of years of working with it.

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Box 24

Water management in France(The actors involved in water management)

In France, a wide range ofactivities are involved in themanagement of water owing to boththe variety of uses of water and thecountry’s historical development.Through the Ministry of theEnvironment, the State directsplanning and regulation while alsoendeavouring to ensure thatecological and economic equilibriaare maintained in relation to watermanagement. Particular uses of waterare supervised by other ministries.

Local communities are the mainactors involved in water supply,sanitation and treatment operations.The communities come together inorder to implement the waterdevelopment plans of the majordrainage basins. It is understoodthat the requirements of the waterusers will be different: industrialconcerns, farmers, sportsmen andfishermen will have different needsfor water in terms of quantity,quality, time and place. Thesedifferent interests can findexpression thanks to the provisionsintroduced by the Law of 16 December1964 which divides France into sixriver basin agencies. This textfavours the expression of solidarityaimed at uniting neighbours within asingle river basin and responds tothe goal of decentralization, whichis imperative in view of thedifferent types of problemsconfronting different regions.Although each river basin isorganized along identical lines,

Incentive:Users have to pay a

predetermined tariff in accordancewith the quantity of water withdrawnand the level of pollution caused. Thecommon fund thus created isredistributed in the form of loansor subsidies to any personsconducting operations in thecollective interest with a view todevelopment of the water resourcesor improvement of their qualitywithin the framework of a programmedrawn up by a Water Agency, whichcollects and distributes the funds.

Coordination:All initiatives within the

river basin are carried out in closecooperation with the competentservices of the administration. ARiver Basin Delegation, made up ofofficials, provides a forum for theconcerns of the differentadministrations, and for theintervention of enterprises andbodies directly involved in water-related functions, namely: Engineering companies with

necessary expertise to analyseand design the most suitable andcost-effective system;

Specialized entities which planand manage water-resourcesdevelopment projects with maximumefficiency;

Industrial concerns whichmanufacture plant, water-supplyand sanitation systems, and puri-fication stations within the

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their management is autonomous andcarried out under the supervision ofthe Minister of the Environment.

River-basin management systemsoperate

according to three principles:

Negotiation:

Rational management of waterin a single catchment area dependson the representatives of the localtown councillors, users andgovernmental authorities, whotogether form a river basincommittee and thus play a rolesimilar to that of a kind of “waterparliament”.

shortest possible time, with thegreatest possible efficiency andstraightforward maintenance; and

Industrial concerns whichmanufacture instrumentation atthe forefront of research andtechnology in the relevant field.

This legislative text wassupplemented by the Fisheries Act of29 June 1984, one of whoseprovisions stipulates that, in allworks constructed on a river, aminimum time or so-called “reserveperiod” has to be observed in orderto safeguard the fish stock.

Source: State Department of the Environment to the Prime Minister, Water. French Technology, “Label France” Collection, paper prepared by the Institut des sciences et des techniques de l’equipment et de l’environnement pour le développement, Paris, France.

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Figure 8. The four levels of water management and their

respective organizations

Higher advisory groups onwater policy

Level 4Political and social

(Higher advisoryassociation or council to

provide advice andguidance on water policyin accordance with thecountry’s or region’sdevelopment plans)

. . . (Formulation of water

and developmentpolicies)

Technical and regulatorywater agencies

Level 3Technical andregulatory

(Responsible for themanagement of multiple

water use and monitoringof environmental impact)

. . . (Management of

multiple water use)

Water developmententerprises

Level 2Economic andproductive

(Private, State or mixedenterprises of sectoralscope responsible for

developing waterresources to meet the

requirements of economicgrowth)

. . . (Management of water

demand)

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Water resources researchassociations

Level 1Scientific andenvironmental

(Responsible forconducting studies on

water and the environmentin general and for

providing environmentalinformation services)

. . . (Investigation of the

environment andforecasts)

Source: Elaborated by Axel Dourojeanni and Juan Gómez Ortega,ECLAC, 1991.

The third major category applies to actors who take decisions on the use ofthe natural resources of the river basin whether or not they reside in it. Actorsresiding outside the river basin are classified as exogenous.Those residing within it are endogenous. Most of the decisionsaffecting the dynamics of a river basin come from exogenousactors. For example, decisions to construct hydroelectric powerplants or communication routes, to assign mining concessions,water rights or property titles, or even to determine forms ofland occupation are planned and adopted outside the river basin.

With regard to the fourth category, the public or private character of theactor, the most important point is to define the composition ofthe steering committees for each river basin and to determine thedecision-making power of each member. In general, in themanagement of water supply for the purposes of multiple use andcontrol of extreme phenomena, the majority of actors involved arefrom the public sector. A lesser role is played by the State inthe management of water demand, since each user sector (drinkingwater, hydroelectric energy, irrigation) may normally have thecharacter of an enterprise, whether public but autonomous orprivate. The municipalities must also play a crucial role in theprocesses involved on river basin management.

The ever increasing transfer to the private sector offunctions traditionally discharged by the State in the field of

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water management imposes the need for detailed study of themanner in which this sector might undertake new activities forwhich it lacks preparation and possibly interest. Management ofmultiple water use, flood control, mitigation of the effects ofdroughts, control of water quality and other similar functionswill need to be assumed in part by the private sector.

A crucial point arising from the foregoing is to determinehow the State will play its technical and regulatory role andwhat authority it will exercise in doing so. The creation ofsupervisory authorities, the involvement of the judicial systemand traditional police force or the establishment of a specialbody for water management and the participation ofrepresentatives of public entities in river basin committees ordirectorates are some of the problem areas which will need to beresolved.

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Figure 9. Integration of management levels and areas for the purposes of integrated watermanagement

Water management levels

Actionareas

Level 1Scientific and environmental(physical management of

the environment)

Level 2Economic and productive

(water demand management)

Level 3Technical and regulatory

(water supply management)

Level 4Political and social

(water management anddevelopment policies)

State or private Private, mixed or State State State or private

International

Joint research entities Agreements among users(shared uses)

International agreements International commissions

National(Political

andadministrativ

e limits)

Scientific, educational, andresearch entities in the field of

water resources**

This Include institutionsservices, laboratories,universities and centreson water resources and

hydrology and other

Companies Drinkable water Hydroelectric Irrigate and

drainage Aquaculture

Ministries Health Energy Agricultur

e Fisheries

Technical and regulatory nationalentities**

Constituted by those incharge of applying laws

water management ofmultiple water use at

national level (GeneralWater directorates, WaterResources Secretariat)

National consultancy/groups**

With equal participation ofrepresentatives from the four

management levels Technical and regulatory Political and social Scientific and Environmental Economic and productive

Macroenvironmental

region(Ecopolitics

limits)

Scientific, educational, andresearch entities in the field of

water resources**

This includesinstitutions services andother existent in the

regions or states that form theenvironmental microregion

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States oregions

Political andadministrativ

e limits)

Companies Drinking water Hydroelectric Irrigation and

drainage Aquaculture

Ministries Health Energy Agriculture Fisheries

Technical and regulatoryregional or state entities

**Constituted by those incharge of applying laws

water management ofmultiple water use at

regional &/or state level(Regional secretariat,

Ministries orequivalent)

Regional or state consultancy groups onwater**

With equal number ofrepresentatives from the four

management levels1. Technical and regulatory2. Political and social3. Scientific and Environmental4. Economic and productive

Basin o riverbasin system(hydrogeographic limits)

River basins Management Corporation or autonomous agencies corporation

***(financial, executives and operative; in charge of coordinating the water offer )

River Basin Committee***

Consultancy groups at basinlevel, with equal participation

of representatives from: Technical and regulatory level

Political and social level Scientific and Environmental level

Economic and productive level

Whit equal representation of technicians users and State

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E. Organizational and functional basis

As a rule, governments formulate policies and draw up plans(sometimes referred to as “master plans”) in order to intervenein a systematic way in a given region in the interests of thepopulations’ development. However, the implementation of theseplans and their respective programmes and projects is generallyheld up or obstructed by the lack of adequate institutionalsystems of organization and management. This happens in differentinstances, principally:

During implementation of the plan, and especially during the execution of development projects (intermediate or investment stage);

During the ongoing operation of the system once the main projects have been completed (ongoing or operational phase, maintenance of works, and resources management and conservation).

Stress is laid in this paper on the need, first andforemost, to improve the organizations, agencies or entitiesresponsible for the ongoing management of river basins fordifferent purposes (integrated development and management, of allthe natural resources or water only). Reference is made hereadvisedly to “organizations, agencies or entities” rather than“authorities” because of the participatory character which suchbodies need to have. Generally, the approach adopted is primarilyto propose the organizational basis of agencies for managing thewaters (for multiple use purposes) in river basins.

Management for the purposes of multiple water use is stillsomewhat limited in Latin America. With the exception ofoccasional inter-institutional coordination initiativesundertaken in emergency situations due to a shortage or excessivesupply of water on the river basin, there is virtually no riverbasin that can boast coordinated use of the water, not even formajor conurbations.

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Consequently, the normal situation is for no user sector toconcern itself with coordinating or improving water supply or thesupply of natural resources in a river basin as long as eachindividual sector remains unaffected by the lack of regulation.Only a regulatory system composed of the users themselves inconjunction with representatives of the State can make sure thatactions are undertaken in the common interest.

In designing the structure of the organizational andfunctional basis of river basin agencies, it should be borne inmind that they will be confronted with a new context as far asthe government services in Latin America are concerned. In fact,the roles of the public and the private sectors are beingredefined, as are the roles of the regional and localauthorities.

The organization responsible for administering river basinsshould, in principle, have a flexible structure capable of beingadapted to the specific requirements of the region in which it isplaced. In this context, the structure of the managemententerprise or administrative system of the river basin willdepend on the profile of each region and on macro policies,essentially with regard to decentralization and modernization ofthe State in Latin America, as well as the assignment of rightsand responsibilities for natural resources management to theprivate sector and local authorities (communes). For this reason,the bare essentials of an administrative system are presentedhere.

(i) Organizational structure

In designing the organizational set-up for the management ofriver basins it is necessary to take account of a set ofelements, which may be divided into those that are “internal”,i.e. specific to the organic structure, represented by what arereferred to as financial, material, human and informationresources, and subject to management control; and “external”elements.

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An organizational system for managing water resources cannotexist in isolation; an entire socio-political system will existaround it and influence its activities in some form or other (seetables 11 and 12 listing the different bodies connected withwater resources through both direct and indirect activities). Theexogenous elements to be taken into consideration are the factorsrelated to political processes (principally, the politicalcontext in which the river basin agency was established), thephysical and climatic conditions prevailing on the river basin(hydrological behaviour), the attitudes of the users of the riverbasin resources, economic conditions, technological changes andorganizations engaged in similar or complementary activities toriver basin management, such as judicial authorities, policeservices, and entities involved in research and training, as wellas the capacity of the municipalities.

The establishment of an organization involves thecombination of economic, technical, labour-related, social,legal, political and cultural elements which make up a structuredwhole. This “structured whole” is required to take action toresolve complex and somewhat unstructured problems. Morespecifically, they have to:

Reconcile the multiple and generally conflicting goals of awide range of dissimilar actors dependent on the same resource(water) and environment (river basin);

Deal with unpredictable and uncertain situations liable to befurther aggravated by ensuing conflicts, such as droughts,floods, pollution and so forth;

Deal with variables within and outside the organization inconnection with social, economic and environmentalconsiderations;

Deal with political change or simply personnel changes withingovernments giving rise to uncertainty within theinstitutional management;

Deal with public and private sectors which do not necessarilyfeel involved or obligated to coordinate their activities withthe river basin agency; and

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Be capable of self-financing and retaining a minimum level ofautonomy as well as continuity of government at the regionaland local levels.

The so-called “policies” guiding the operations of anorganization of this type should, in principle, be expressed inthe form of a plan, which should, in turn, be translated intoprogrammes and projects.

Table 11. Indirect actions undertaken by bodies involved inwater management processes in a country

Generic title ofactivity

Education and training

ResearchAdministration

Assignment of the use of resourcesProject management

Control, monitoring and

oversightLegislation and regulation

Logistical support,organization

FinancingPolicy-makingand planning

Actors bysubsystem and

typePolitical andsocial level

Higher Water Council

Ministry of Economic Affairs

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Ministry of the Interior

Ministry of Planning

Technical andregulatorylevel

Ministry of Agriculture

Ministry of Public Works

Ministry of Public Health

Economic andproductivelevel

Water-supply and sanitationenterprise

Hydroelectric utility

Riverside municipalities

Scientific andenvironmentallevel

Universities Non-governmental organizations

Advisory bodies

Source: Axel Dourojeanni, ECLAC, January 1994.

Execution of the projects requires the work to be divided upby administrative systems of an “analytical and formal” nature,without the integrated character of the efforts being forfeited.In other words, it is necessary to be able to subdivide theactions without forfeiting their vital integrality orcoordination in their execution. It is also necessary to have afunctional and coordinated system to ensure that the differentactors know exactly how the organization functions, what they canexpect of it and what is expected of them.

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The complexity of the tasks undertaken by an organization isso vast that they cannot possibly be accomplished by a singleindividual. The tasks therefore have to be divided up in asystematic manner if they are to be carried out efficiently. Thisleads us to the subject of segmentation or differentiation inorganizational structure. The process of segmentation creates theorganizational hierarchy.

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Table 12. Direct actions undertaken by bodies involved in water

management processes in a countryActors by subsystem

and typePreliminary activities Intermedia

teOngoing

Evaluationof riverbasin

resources

Formulation of

projects

Executionof

projects

Operationand

maintenance of

hydraulicstructure

s

Managementand

conserva-tion ofnaturalresources

Political and social levelHigher Water CouncilMinistry of Economic

AffairsMinistry of the

InteriorMinistry of Planning

Technical and regulatory levelMinistry ofAgriculture

Ministry of PublicWorks

Ministry of PublicHealth

Economic and productive levelWater-supply and

sanitation enterpriseHydroelectric utility

Riversidemunicipalities

Scientific and environmental levelUniversities

NGOsAdvisory bodies

Source: Axel Dourojeanni, ECLAC, January 1995.

The division of work resulting from the process ofsegmentation makes it necessary to institute a number ofcoordination and integration mechanisms in order to ensure thatall the individuals within the organization can work togetherharmoniously towards realizing the organization’s vision.

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Thus, in order to achieve each type of objective set by theactors, the river basin agency will have to define a structurecapable of gaining access to and organizing the means it requiresto perform interdisciplinary and intersectoral projects.According to Sallenave,71 the structure of an entity in thestrict sense of the term is but one of the variables of the wholesystem managed by the executives of the entity. This whole istermed the “organizational framework” and comprises the following:

The adoption of a structure; The definition of tasks; The form of personnel administration; The adoption of an incentives system; The administration of information and decision-making

systems.On this basis, it is possible to define the structure of the

river basin agency in such a way that it fits into the “macro-institutional structure”, which consists in the relationshipwhich needs to exist between the agency and the institutions andactors related in any way with integrated management of the riverbasin (for example, a river basin committee). It also needs to beremembered that a river basin agency may have a private or publicadministrative profile. It will, at all events, be monopolisticin character, which implies the need for a supervisory body toact as auditor, a single body of this kind possibly being capableof undertaking the supervision of all the country’s river basinagencies.

A further key factor to be considered in establishing ariver basin agency is its classification in relation to thesource of funding. Accordingly, it may have public, private ormixed status. It should also be borne in mind that such an agencyis an enterprise whose production process has no physicalcounterpart (in other words, it does not produce physical goods)but which provides services such as the administration of aphysical asset in the form of the water resources of the river

71J.-P. Sallenave, Management and strategic planning, Editorial Norma,Colombia, December 1991.

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basin and also serves the function of supervising proper use ofthe land contained within the basin (for example, ensuring thatflood zones are not encroached upon) in order to protect itsinhabitants, natural resources, water quality and thedistribution of the resource among the different users, to namebut a few of its functions.

The river basin agency is composed of a group of personswho, as individuals, would not be capable of meeting the goalsset with a view to the integrated management of the river basin’swater resources. What is needed, therefore, is an administrativemethodology for coordinating the individual efforts. Thetechnical and regulatory authorities, such as the Water Boardsand Higher Water Councils of a country must take account of theelements comprising the knowledge base (i.e. concepts, theories,principles and techniques) and which support the administrationof the river basin agency (the administrative process is atheoretical abstraction formulated for methodological purposeswith regard to the steps or phases towards the achievement of anobjective, in this case, that of improving the use of the waterresources of the river basin (see box 25).

Various different approaches or currents exist with regardto aspects of administration. Administration involves a set ofmutually complementary economic, social, political and culturalelements. This point of view accords with the interdisciplinaryapproach nowadays adopted to administration and in the context ofwhich the tasks of the managers of a river basin agency develop.Analysis of the various options covers current experiences andthe legal standards in force, the political framework determiningthe courses of action to be taken, and the positive and negativeeffects that might be produced in the behaviour of persons andgroups and their interrelationships. Ultimately, all this leadsto the adoption of decisions which, in as far as they can bequantified, will make for greater objectivity and more completeachievement of the desired results (see figure 10).

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Box 25

Features of the administrative process It is universal, which means that it is found in any institution,

activity and level thereof;

It is recurrent, in the sense that one element gives rise to theapplication of another, so that it takes the form of an endless spiral;

Its outcome is coordination. As the different elements of theadministrative process— planning, organization, management/execution andmonitoring—are appro-priately designed as a consequence of the samerecurrence and universality, then coordination will have been achieved;

Thus, coordination is not an element of the process that can be regardedas a separate stage within a global activity. Coordination means simplystriking a balance between the various elements which make up a whole.Depending on the behaviour of these elements, in achieving an objective,we accordingly have a coordinated or an uncoordinated activity.

Source: Gilberto Flores and Diogenes Ramirez, Algunos aspectos básicos de laadministración, University of Chile, mimeograph, undated.

(ii) The necessary evolution

The river basin agency will not have any other similar entitywithin its geographical territory, which means that itsactivities will have a monopolistic character, as mentionedabove. Its competitiveness will have to be demonstrated byapplying criteria of quality, flexibility and change, successbeing attainable in all of these if personnel resources andlabour are accorded enhanced status as its basis, together withits relationship to the environment.

The agency has to begin with a structured training plan inorder to maintain its relevance within the sphere of river basinand water resources management. This training process should beaimed at:

The personnel of the organization itself;

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The river basin water users; The municipal authority employees; and The regional authorities.

In addition, extension activities encompassing the entirepopulation of the river basin should be carried out.

Moreover, consideration should be given to the diversecharacter of its field of operation, which is reflected in themultiplicity of uses to which the water resource is put. In thiscontext, training should be seen as a continuous process ofchange in regard to the actors involved, directed towardsoptimizing their relationship with the environment.

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Figure 10. Cube Theory

Source: Bobadilla Fortunato, Cube Theory, University of Chile,mimeograph, 1975.

The fields of training to be developed do not necessarilyhave to be related to specialized areas or occupations. They mayalso deal with basic skills required in discharging any task atthe workplace, such as training in learning self-management,learning to innovate, learning to adapt and learning to change.72

The administration model which is applied determines the

agency’s productive and economic performance. It is thusnecessary to have a clear idea of the process of continuousimprovement that enables the agency to enter a dynamic cycle ofexpansion within the frameworks of efficacy and efficiency. This

72Andrés Jara, “Capacitación y Desarrollo Integral”, in Estensión desde el Centro,Pontifical Catholic University of Chile, October 1993.

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is nothing more than the application of scientific method and thecontribution of individuals to continually improving everythingthat the institution does, in order to achieve and exceed on aregular basis the expectations of the river basin user public.

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(iii) The institutional framework

Using the terminology employed by ILPES73 to define the newplanning approaches in Latin America, an attempt will be made todefine the parties with which the river basin agency will need toestablish linkages. This network of interconnections is whatbasically defines the “institutional framework”. Theparticipation of the actors in the watershed management planningprocess is essential to the functioning of theseinterconnections, particularly with regard to the allocation ofresponsibilities and the concept of a specific institutionalsystem, which, according to ILPES, should be in strict harmonywith the political plans which the public has supported. There isno doubt that a close connection should exist between the riverbasin management agency’s coordinating function and its decision-making function in implementing the components defined in itsstrategy: the clearly defined objectives of organizationalactivity (attributes, rating scales, norms, time-frame); the planof action at the level of the agency as a whole and at the levelof the divisions; the functional programmes which describe andmeasure the consequences of the plan for each of the agency’sfunctions (finances, public relations, personnel, etc.); and thefinancial resources required to carry out the programmes.

The river basin agency does not operate in a vacuum. Anentire “social fabric” exists within the river basin and there isa close relationship between these actors and their environment,factors which condition the agency’s actions. It is necessary toleave the channels of participation open (particularly if theriver basin is viewed as an open system) to the endogenousactors. At the local institutional level, the municipal authorityplays an important role in the strategic design of the management of the riverbasin’s natural resources, especially water. No less important will be theinterlinkage with other, national bodies, for example those

73Latin American and Caribbean Institute for Economic and Social Planning(ILPES), Repensando la planificación, LC/IP/R.139, Document of the Meeting of theSixteenth Management Board of the Regional Planning Council, Brasilia, Brazil,24 and 25 November 1993.

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responsible for activities within the juridical, law-enforcement(policing) and supervisory spheres.

It is the responsibility of the river basin agency to act asan advisory body in the elaboration of standards for river basinnatural resource and water management. The municipal legislativeand executive institutions are the authorities entrusted with theelaboration of standards for regulating water use and definingwater resource rights specific to each river basin.

Once the standards have been established, theirimplementation is frequently accompanied by coercive measures(fines). For this purpose, forestry police forces and “waterpolice” forces have been set up as law-enforcement bodies inseveral countries of the region. It is therefore essential that aclose relationship should exist between the river basin agencyand the police and judicial authorities. It will also beresponsible for laying down technical decisions and norms in thisconnection, and for assisting the judicial and law-enforcementbodies.

One of the most important organizations within theinstitutional framework of river basins is the water committee,also known as the water parliament, which has the responsibilityof serving as a forum for the river basin actors (see box 26). Itis within this forum that macro activities within the basin aredefined, projects approved, and short-, medium- and long-termstrategies formulated. Also, it will sometimes be able to serveas a forum for settling serious conflicts which it has not beenpossible for the river basin agency to resolve; this would be anarbitral function.

Finally, mention should be made of the regional auditoffice, a necessary organization which fulfils a major rolewithin each region’s public administration system. It’soperations will permit transparent management on the part of theriver basin agency and the efficient use of financial resources.It may have the character of a supervisory authority, but its

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establishment is essential, whether as a public, private or semi-public body.

Box 26

River basin committees in France

Management authority has beentransferred to the water usersthrough river basin committees.

Each river basin committee iscomposed of:

Elected dignitaries (mayors, members of parliament, etc.);

Users’ representatives (industrialists, water supply enterprises, fishers, farmers, nature conservation organizations, etc.); and

Representatives of the State.

It should be noted that,within the river basin committee,the majority is constituted by theusers’ representatives plus theelected members and that this groupis entitled to decide on the policywhich they feel is most appropriatefor managing the water in theirriver basin. The Government formsthe minority and cannot impose itsown policy in water-related matters.

Each committee has a hundred or somembers on average and isconsequently unable to meetfrequently; executive power istherefore exercised by the riverbasin agency, under the direction ofits board of administration.

The board of administration iscomposed of 26 dignitaries electedfrom among the membership of theriver basin committee: 8 elected members; 8 users’ representatives; 8 representatives of the State; 1 representative of the river

basin agency’s personnel; and

The president of the board ofadministration, designated by theGovernment. Here also, the usersrepresent the majority.

Source: Alain Cadiou, Water management in France: towards sustainable development,Agence de l’Eau Seine-Normandie, France, undated.

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3. Management support systems

A. Information systems 74

Any management system has to be based on a reliable andhomogeneous chain extending from measurement sensors to workscontrol devices. The applications for river basin management arenumerous (see box 27).

Information is the key to directing water managementprocesses, which are essentially geared to decision-making inorder to avoid conflicts between users (technical, physical,legal, economic and other) and conflicts between individualswhich affect the environment. However, information has a highcost, and it is therefore necessary to be selective indetermining what type of data is required for each decision, inwhat detail, with what frequency, from what places and for whattypes of user (see box 28).

In interdisciplinary decision-making groups and operations,a further requirement is that data on different topics anddisciplines can be coordinated and integrated.

Management is a process of taking individual and corporatedecisions which are supported by structured information, i.e.decisions that can be taken on the basis of mathematical orsimulation algorithms and models and by unstructured information,i.e. decisions taken on the basis of experience and intuition. Inthe case of water resources, both types of decision-making arecombined.

Political decision makers tend to take decisions on thebasis of qualitative data and intuition in extremely short timespans. Conversely, scientists are likely to take decisions on thebasis of quantitative models and sequential logic withoutnecessarily being under any specific time pressure. The

74Jackie Sellers, “Information Needs for Water Resources Decision-Making”, Natural Resources Forum, August 1993. A United Nations Journal,Butterworth-Heinemann, Cambridge, England.

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information system must make it possible to reconcile both formsof decision-making, for example by transmitting the results ofthe models in a comprehensible and useful manner for takingpolitical decisions.

The information system must be available in a situations roomand be useful for taking decisions on several levels: strategicplanning, which is planning for medium-term and long-termdecision-making. Tactical planning, which is a more refined processfor defining, prioritizing and integrating shorter-termdevelopment activities; specific analysis of a programme, project,operation, procedure or task; their design and implementation; andfinally periodic evaluation or monitoring of the results.

A large number of water-related decisions are taken in thesocio-economic and political fields. This means that the data mustemanate from information sources external to the water or river basin agency.Whatever information system is designed has to take thissituation into account in order to establish means ofcoordination with the entities which handle such statistics.

At present, a series of mechanized systems exist which makeit possible to input and process information with a view toconveying it to a “situations room”. Examples of these systemsare the “decision support system”(DSS) and “managementinformation system” (MIS), which are supported by optimizationand simulation models and by technologies such as thegeographical information system (GIS). The most important localwork is therefore not in the design of the system but in theselection, gathering and application of indicators suited to theenvironment where decisions are taken using these systems.

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Box 27

Information systems materials and methods Measurement sensors (water-levelrecorders, flow metres, snow gaugesetc.), situated at the basis of anymanagement system, operate with datawhich, after codification, areteletransmitted in real time or recordedin situ.

Measuring techniques. If river waterdepths or other data, including averagespeeds, are easily teletransmitted,these measurements which are availablein real time are not fully meaningfulunless they are accompanied by gaugingand adjustment operations carried out bytechnical personnel during site visits.The measurements make it possible inparticular to establish the relationshipbetween river-water depth and flow.

Weather forecasting and radar. Hydrological services do not only use information transmitted from on-site measuring apparatus to establish their forecasts. Short-term and medium-term weather forecasting and rainfall system monitoring by radar increasingly assist them in their tasks:- Weather forecasting. Numericalweather forecasting models make itpossible to correctly represent changesin the atmosphere’s condition from agiven initial condition over periodswhich have proved useful forapplications;- Radar. For short periods rangingfrom one to six hours, use is made ofimages provided by weather radar. Theradars allow for continuous real-timemonitoring of rainfall zones over aradius of approximately 150 kilometresaround their location points.

Measurement acquisition unit. The choice oftechnologies is extremely vast: from the

Satellite transmission (data gathering andteletransmission).

Radio networks (networks with a single gathering centre, multi-centre networks, networks having a mixed structure):- Small-range network with a singlegathering centre. Some small-scaleriver basins may for differentreasons require a specific network;- Multi-centre network. In large-scale river basins, decentralizationof tasks and close coordinationbetween the centres are necessary.

Collection and management centres. The collection and treatment centre makes it possible to coordinate the entire network, from the measuring stations to the works control structures.

Methods of hydrological forecasting (rain-water flow (water level) models, real-time processing of forecast deviations, etc.). All the methods formulated are generally incorporated into an operational assembly. This makes it possible to predict flow rates and water levels throughout the river basin, simulate the spread of flood waters, etc.

Integrated management systems. Teletransmission systems are regularlyused for real-time management of irrigation networks. Also the management of all the structural worksof a river or river basin can be automated. The automatic discharge management system can be operated in two interactive stages:

- A river water requirement forecastmodel and a river inflow model makeit possible to determine the target

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simple hydrometry station which suppliesone datum for each inquiry, to the complete climatology station, which automatically controls data gathering from many measurement sensors. Generallyspeaking, one independent on-site measurement acquisition unit, even a very simple one, can prove extremely useful.

The materials used in the installation ofmeasurement sensors and of hydrometryand climatology stations must have highperformance levels, withstand difficultoperating conditions, be easy tomaintain and function at low cost. Otherfactors to be taken into account includetheir adaptation to the site, protectionand energy consumption.

Ground transmission vectors. Telephonenetworks can be used to transmitnumerical data and play a key role indata teletransmission. In some cases, itis essential to have direct telephonelines, referred to as specialized lines.Automatic radioelectric networks areused if the hydrological conditionsrequire extremely safe and immediateavailability.

to be met. The river is divided intodam levels. The modelling of theinflow is based on a simplifiedrepresentation of the “black box”type. It consists of a delay timeand an identified transfer functionfor each dam level based on a moredetailed hydraulic model;- Within the shortest time, the datameasured at the gauging stationspositioned along the watercourse,are used to modulate the discharges.The results of this second stage arein turn taken into account in thefirst stage.

Specific applications (forecasting of flooding, management of hydroelectric works, operation of flood control dams, etc.).

Source: Ministry of the Environment, France and operational hydrology: teletransmissionnetworks and water management, collection “Label France”, Paris, France,1986.

Box 28

Action implementation process(Methodological chart)

Steps Description of each step

1. Actors Identification of the active or passive actorsparticipating in the management process forsustainable and equitable development. Typology.

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2. Criteria Gathering of explicit or implicit criteria thatsupport the positions of the actors involved inthe process. Monitoring.

3. Problems Gathering of problems expressed by each of theactors, on the basis of their needs and aims.Prioritization.

4. Objectives Establishment, directly or by inference, of theproblems, goals and objectives of each of theactors. Prioritization.

5. Shared sphere

(abstract)

Inventory, evaluation and physical and socio-economic diagnosis of the territorial andfunctional spheres where the objectives (past,present and future) are to be achieved. Controlof environmental sustainability.

6. Restrictions Identification of the technical, political,legal, economic, financial, organizational,functional, cultural, educational, commercial andother restrictions which hinder or prevent theattainment of the objectives. Prioritization.

7. Solutions Generation of solution options for overcoming thepreviously identified restrictions andprioritization of solutions. Selection.

8. Strategies Design of strategies for implementing thesolutions through discontinuous (investmentprojects) and continuous (services, productionsystems and other) activities.

9. Operational

programmes

Programming of activities (programmes, projects,operations, procedures and tasks) according tothe solutions and strategies selected for theirexecution, implementation of control activitiesand follow-up of the results obtained.

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10. Sharedsphere (real)

Implementation of the programmed actions in thesphere. Monitoring of the objectives andenvironmental sustainability.

Source: Axel Dourojeanni, 1993.

The river basin agency’s system installed for gatheringinformation generated by any type of organization (universities,NGOs, public bodies, municipal authorities and the agency’s owndata) must in principle be able to supply information on theriver basin environment, such as information concerning:

Water supply. General information on the dynamics of surface water and groundwater supply and on the structural works and organizations which handle such supply;

Water demand. Data on current and projected demand of each user sector and of groups of users in the “water regions”, forthe purpose of operating the water system and predicting potential conflict situations;

Water quality. This is today a key issue for management both of the water itself and of the environment. There are several possible water-quality models available for use. For example, the models employed by EPA are Qual2E and Qual2E-UNCAS, which are used for planning water-quality management activities. Naturally, the models require the provision of basic data regularly obtained on site. It is necessary to select water-quality indexes (WQIs) and to obtain periodic information, by section of water channel, point of contamination and other units. Water-quality treatment makes it possible to increase water supply;

Environmental data relevant to water management, particularly onnature zones, water channels, lakes, wetlands and estuaries. It is one of the most extensive areas of information and therefore, in order to be useful and not excessively costly, has to be limited to priority data for decision-making.

Such data have to be compared with social and economicstatistics. The information system for assisting water-related

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decision-making has to continually set the socio-economic andenvironmental factors against the actual behaviour of theresource. This means that, in parallel to the above information,socio-economic, demographic, legal, organizational and other datahave to be provided so that action strategies can be designed. Aknowledge of the actors, their views, problems and objectives isessential for taking decisions aimed at resolving conflictsbetween them.

B. Decision models

The models employed to assist in water resource managementdecision-making have evolved over the last 30 years. InLatin America, although there are professionals who are expertsin this subject, the use of these decision models in managingglobal water supply has been very limited. They have, however,been used extensively in sectoral water management (irrigation,hydropower, drinking water) and also in hydrological andhydrogeological modelling, particularly in the operation of dams.

Most model use has been directed towards analysing andmanaging the physical behaviour of hydraulic systems, such asmodels for describing the hydrological behaviour of river basins,groundwater, river flows and movement of sediment for the purposeof operating reservoirs, preventing flooding or designing pumpingsystems. For these cases, simulation models are primarily used,with some support from optimization models, such as linearprogramming.

Pétry, in her article “Who is afraid of choices?”,75

analyses the different models that may be used for decision-making on the basis of multiple criteria and multiple objectives(multi-criterion and multi-objective decision methods). Sheexplains first the evolution of the methods and then theirprinciples.

75Françoise Pétry, “Who is afraid of choices? A proposal formulticriteria analysis as a tool for decision-making support in developmentplanning”, Journal of International Development, vol. II, No. 2, April 1990.

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With regard to their evolution, she points out that theformalization of these decision models began between the late1960s and early 1970s. It was started with double-entry tablesand “expert” opinions to weigh up each alternative or criterionand then obtain weighted data. These were rigid systems in thesense that the decision maker could not modify his initialcriterion or viewpoint on seeing that the results did notcoincide with many actors’ expectations.

Subsequently, in the late 1970s and early 1980s, methodswere designed which followed the logic of human reasoning moreclosely (they accepted indecision, factors which cannot besubstituted or replaced, the impossibility of comparing certainvalues). They were based on interactive and flexible systems involvingthe decision model and the decision maker. In other words, theyaccept that the decider may modify his original ideas (criteriaand objectives) as the decision-making process advances and hecontinues to “learn” about the problem and, in particular, tounderstand the interactions which occur as a result of eachdecision.

The interaction between the decision maker and the model“teaches” the decision maker. Decision models are now becomingincreasingly more “friendly” in this sense. They make it possibleto take a decision and “see” what would happen, indicating thepossible results. All these models use combinations of methods,which will not be described in detail in this paper, such as:weighting, grids or matrices, utility functions, multiple-objective programming, goal programming (extensions of linearprogramming), superimposed graph systems, interactive graphsystems, geographical information systems and statistical models.They all have computer support.

This generation of models has laid the foundations for theformulation of complex models for taking water-related decisionsusing multiple objectives (multiobjective analysis models). Riverbasin management agencies usually have to make use of some ofthese models to assist in decision-making for, inter alia, operatingmultiple-use water systems, selecting and prioritizing

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investments in hydraulic works, proposing water transfers andmanaging water quality.

There are currently very many complex models available aswell as abundant literature and methods for selecting the onesmost suited to each case (see box 29). However, the latestgeneration of models takes macroeconomic policies, socialpolicies and environmental policies into account with a view tooptimizing both the structural results (direct or engineeringmeasurements) and non-structural results (management orindirect).

Box 29

Basic principles for usingdecision-making support models

in integrated river basinmanagement

Probably the most important factorfor a decision maker is to know whatprinciples should form the basis forusing these models, bearing in mindthat, if the problems are toocomplex and no data are available,experts’ decisions taken “byintuition” are far quicker and donot give results that are very muchpoorer than those reached using acomplex decision model and few data.The decision maker fluctuatesbetween two axes: one extending fromthe intuitive to the mechanical andthe other from the qualitative tothe quantitative. Pétry describes

Technical analyses must not be com-pletely separated from policyanalyses. This means that analysesmust be transparent, decision-makingprocesses must be flexible, and boththe planner and the decision makermust learn to interact.

Principle 3: Decisions are takenwith uncertainties. It is thereforeimportant to conduct sensitivityanalyses, asking what would happenif the available data were notreliable, if not all the variableswere taken into consideration, ifsufficient research or record years

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the principles for using ruraldevelopment models, which aresimilar to integrated river basindevelopment models, as follows:

Principle 1: Integrated riverbasin management decisions areessentially decisions with multiplecomponents and multiple objectives.Consequently, for decision-makingpurposes in this area, use has to bemade of multi-criterion decision models.This means considering severaldisciplines or dimensions (physical,economic, social, environmental),prioritizing objectives andcontemplating various alternativesor courses of action.

Principle 2: Planners (e.g. awater systems expert) cannot replacedecision makers (e.g. a river basincommittee) but must interact withthem, pointing out to them variousoptions and the effects of theirdecisions.

did not exist, or simply ifpolitical changes in the future werenot foreseeable.

Principle 4: In general there is no“best” method for decision-making.An intelligently used “poor” methodis better than a poorly used “good”method. In many cases, the decidersare not even aware of the results ofthe models, particularly if theyhave not interacted with thosemodels and are not familiar withthem.

Principle 5: The decision-makingprocess is essentially a learningprocess. Frequently, more decisionsare based on this learning than onthe final results of the applicationof the model. Therefore, decision-making models have to make itpossible for dialogue betweenplanners and deciders (at any levelof knowledge) to be interactive anditerative. The manner in which thedecision is taken has to beexplained with total clarity andtransparency.

Source: Françoise Pétry, “Who is afraid of choices? A proposal formulticriteria analysis as a tool for decision-making support indevelopment planning”, Journal of International Development, vol. II, No. 2,April 1990.

Some of these models that apparently yield good results arethe “macroeconomic models” which North76 considers can be dividedinto four generic types: input-output models, econometric models,dynamic models and multiple-objective optimization models. Hebelieves that they can be adapted for decision-making in watermanagement processes.

76Ronald M. North, “Application of multiple-objective models to waterresources planning and management”, Natural Resources Forum, August 1993.

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In order to conduct an integrated river basin managementprocess, it is necessary to carry out a series of steps similarto those carried out in order to formulate a regional developmentprogramme.77 However, more simplified methods exist, such as theone presented in the publication “Management procedures forsustainable development (applied to micro-regions and riverbasins)”,78 which can be applied to river basins, micro-regionsand municipalities smaller than a region or a large river basinand which produce excellent results over a short period and atless cost. Moreover, the results of this paper can serve as aninput for applying the working methods in regional development.

The management processes which, for example, are necessaryfor decision-making in order to direct the course of a riverbasin development are four in number (see graph 3 and box 28):79

Action implementation process which leads to economicgrowth;

Transaction process which leads to equity; Environmental dimension incorporation process which leads

to environmental sustainability, and Discipline integration process.

Under the method described in “management procedures forsustainable development (applied to micro-regions and riverbasins)”, it is necessary to identify the actors acting on theriver basin, define their views, problems and objectives,undertake inventories, evaluations and diagnostic analyses, and

77The body with the greatest experience in this field is the regionaldevelopment working group of the Organization of American States (OAS).

78Axel Dourojeanni, Procedimientos de gestión para el desarrollo sustentable (aplicados amicroregiones y cuencas), Latin American and Caribbean Institute for Economic andSocial Planning (ILPES), Document 89/05/Rev.1, Serie Ensayos, Santiago deChile, October 1991.

79The method of conducting these four processes and their interactionsare detailed extensively in the book written by Axel Dourojeanni (Procedimientosde gestión para el desarrollo sustentable (aplicados a microregiones y cuencas), Latin Americanand Caribbean Institute for Economic and Social Planning (ILPES), Document89/05/Rev.1, Serie Ensayos, Santiago de Chile, October 1991.

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determine the obstacles to be overcome and possible solutions,and also the strategies and programmes to implement them. Thismethod is being applied on several river basins andmunicipalities in Latin America and the Caribbean with goodresults.

C. Planning systems

Planning for (i) river basin development, (ii) management of theuse of a river basin’s natural resources or (iii) water resourcesdevelopment has a longer tradition in Latin America than planningfor management of the use of water resources at the individualcountry level.

In general, water resources plans, in order to be effective,must serve an efficient management system. Also, and this is verynecessary, they have to be formulated with the participation ofthe different actors involved in decisions affecting the watersystem, particularly those sectorally programming their water-related activities (drinking water, irrigation and hydropowerenterprises and others).

Also, the formulation and application of water plans must becoordinated with regional and national development plans; inother words, the water demand projections have to be consistentwith the country’s development plans and the macroeconomic anddemographic situations.

The water resources management plans have to meet theexpectations of the four categories of actors concerned with theriver basin water management (endogenous and exogenous):scientifico-environmental, economic-industrial, technical-normative and politico-social. Each of these groups of actors hasits own interests, which have to be reconciled.

Traditionally, water resources plans were limited toprogramming investments in multiple-use hydraulic projects inorder to increase the actual water supply and to control extreme

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phenomena. Subsequently, this perspective was extended to includemeasures enabling demand to be managed both through structuralmeans, such as hydraulic works to improve efficiency of use, andthrough non-structural means, such as the establishment ofdifferentiated water consumption charges to act as a disincentiveand to control excessive consumption.

Water resources plans have to incorporate in theirconsiderations the future effects of water rights already grantedand to be granted and also the effects which the purchase andsale of water rights may have on a potential “water market” ifthe Government promotes such a system.

Social and environmental effects also have considerablebearing on the plans, particularly as regards the participationof local actors, such as municipal authorities, in the managementof water, river channels, and the prevention of adverse effectssuch as flooding and pollution.

The maintenance and economic analysis of water values areessential to the formulation of water resources developmentplans, particularly in a social market economy where water rightsare granted. The value and price of water, in particular wateropportunity costs viewed from the perspective of the possibility ofselling rights to users who may have a more profitable use, mayalter the projections of the utilization of this resource.

The marginal costs incurred by each user sector in grantingspecific water supply services and fixing the consumptioncharges; and pollution costs and fines, which have substantialeffects on investment in water resources development and theoperation and maintenance of the systems as well as on pollutioncontrol, also have to be taken into account in the formulation ofthe plan. In addition, physical, environmental and economicexternalities have to be taken into consideration in waterplanning, particularly in view of their effects on social equity.

In general, the management committee responsible fordirecting the management process for a river basin development is

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expected, by means of a plan, to obtain the following informationfor decision-making purposes:

Identifying and demonstrating the role played and to be playedby water resources in terms of quantity, quality, place andtime, promoting the development of the region, preserving theenvironment and social equity;

Determining, for minimum time-frames of five, ten and fifteenyears, the structural needs (hydraulic works) and non-structuralneeds (market instruments, water prices, organization,legislation) in order to balance water supply and demand interms of quantity, quality, place and time;

The above information should allow for decision-making thatwill make it possible:- To design and coordinate the engineering works (investment

projects) for the regulation and control of multiple wateruse. On the basis of this information, the investmentprogramme can be determined;

- To identify ways of managing and, where possible, reducingdemand by user sector through greater efficiency ofutilization per unit of use;

- To structure the type of river basin organization and, inparticular, the type and form of institutional coordination inorder to carry out decisions balancing supply and demand;

- To project the potential water market which may arise fromchanges in water opportunity costs and the necessaryinstruments for orienting and regulating this market andavoiding the emergence of conflicts with third parties andwith the environment;

Planning should also serve to determine the current andpotential areas of conflict between users and with theenvironment; areas of overexploitation of aquifers, areas ofprohibited use of groundwater, areas of flooding, incidence ofdrought, water pollution, erosion and build-up of sediment,conflicts concerning town water supply and water assessmentsfor each sub-basin, zone and region.

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The basic planning methodology, given that it has toincorporate the above-mentioned points regarding economy,environment and social equity, generally follows a typicalpattern (see box 19). This pattern consists of:80

Subdividing the river basin, and also the adjacent basins fromor to which water may be imported or exported (transfers),into “hydraulic sectors or regions” within which the supplyand demand studies will be made;

Identifying the principal endogenous and exogenous actorsacting on the river basin, in order to observe and perceivetheir established or projected needs, goals and objectives onthe river basin; involving the actors in the planning process;

Identifying and measuring current resource supply and uses,unsatisfied and projected demand, restrictions in meetingdemand, legal systems and other factors necessary fordescribing the problems, objectives, restrictions and possiblesolutions (linking them to each actor);

Elaborating a prospective model or future scenario ofpotential growth of demand for the purpose of projecting andanalysing possible conflicts of use in terms of quantity,quality, place and time of occurrence;

Calculating simultaneously potential supply of surface waterand groundwater, and also possible treatments required toreutilize the water and control water surpluses and deficits;

Identifying and evaluating a set of structural and non-structural alternatives in order to balance water supply withdemand;

Identifying and adopting methods, techniques, models and othersystems that will make it possible to improve theparticipation and decision-making process for the purpose ofselecting the best solutions to meet multiple objectives;

Establishing the information system with key indicators anddata;

80Ronald M. North, “Application of multiple-objective models to waterresources planning and management”, Natural Resources Forum, August 1993; andInternational Hydrological Programme (IHP), United Nations Educational,Scientific and Cultural Organization (UNESCO), Integrated planning and management ofwater resources (Guidance material for courses for engineers, planners and decision-makers), editedby S. Dyck, IHP-III, Project 14.3, Paris, 1990.

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Determining what other exogenous factors may affect waterutilization projections or decision processes linked tonational and international aspects (chiefly macro-economic andpolitical aspects) relating to loans, environmentalagreements, measures for protecting the indigenous population,protection of biodiversity, tourism, industrial developmentand other factors;

Testing and evaluating the various alternatives; analysing theresponsiveness of the alternatives to internal and externalchanges in economic, financial, political, legal and otherplans; analysing the effect of interaction of the differentsolution options;

Selecting and recommending feasible solutions, executionschedules, outlay, staffing requirements, cost and benefitallocation, and, in general, designing the strategy toimplement the solutions; testing their soundness, analysingpossible negative pacts and potential restrictions on theirexecution;

Formulating the final strategy for progressively implementingthe structural and non-structural solutions with the aim ofbalancing water supply with demand;

Evaluating the possible effects arising from the future wateruse situation, so as to obviate the need for structural andnon-structural measures to be taken in order to minimizeenvironmental, economic and social conflicts that may occurwith the application of the plan;

Putting forward specific schemes for balancing supply anddemand and determining who is to be entrusted with theirfinancing and execution; designing the strategies for puttingthem into practice; identifying the role of each of the actorsin the execution of the plan;

Designing the management system responsible for coordinatingand monitoring the activities.

4. How is a river basin agency scaled?

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A. Factors affecting the formation of river basin agencies

(i) General factors affecting the formation of river basin agencies

The external factors which affect the formation and structuringof a river basin agency include:

Ecological, climatic, geomorphological and physiographicalfeatures, and size of the river basin;

Historical knowledge and records of water discharge in termsof quantity, quality, time and place, as well as water demand,the basin’s water assessments, pollution, extreme phenomenaand other factors;

Current management organization in the basin by managementlevel (scientifico-environmental, economic-industrial,technical-normative and politico-social);

The endogenous and exogenous actors acting on the river basin(number and socio-economic characteristics);

Legality regarding possession or right of use of naturalresources, properties and other assets, and the way in whichthe river basin users are currently grouped together;

The degree of development of the river basin with regard toroad infrastructure, communications, transport and otherservice infrastructure;

The possibility of other entities’ participating in themanagement and degrees of coordination and operationalcapacity (with the judicial system, police, research andtraining systems, water quality laboratories, construction andother systems);

Level of public and private activity on the river basin; Economic exploitation of natural resources, in particular

water; Predominance of user type; irrigated and non-irrigated areas.

In order to illustrate the way in which the above-mentionedfactors determine the type of river basin management system, box30 describes the form of organization of micro-basins, or“microbacias”, in Brazil.

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Box 30

The micro-basin programme of BrazilThe National Coordinating Committee for the Micro-Basin Programme is underthe jurisdiction of the Ministry of Agriculture of Brazil. The programmewas established by Decree No. 94076 of 5 March 1987 by the FederalGovernment of Brazil. It is being implemented in the States of Paraná andSanta Catarina and its aims are to promote the planning and rational use ofrural areas, making it possible to enhance production, productivity and thesocio-economic conditions of the farmers through the proper use of theimmense potential of the natural resources available: soil, water andflora. Its specific goals are to ensure the proper use of naturalresources, primarily soil and water, to stimulate agricultural productivityand production; to reduce the risks of drought and  flooding, to slow downthe processes of soil degradation, particularly erosion; to guaranteegreater availability of water for various purposes; to foster thedevelopment of partnerships among rural producers, to stimulate planning,organization and marketing of municipal produce; and to promote communityaction with a view to achieving benefits in the spheres of production andmarketing.

The tasks for the years 1987-1990 were to identify 4,000 micro-basins (onein each municipality); select and equip 26 pilot basins; promote thesharing of experiences among 5,000 rural leaders, prefects and municipalleaders, train 1,000 technicians annually in providing technical advisoryservices; equip 1,000 local offices offering micro-basin planning andextension services; and promote information dissemination campaigns.

Source:

Ministry of Agriculture—SNAP/SRN, National Micro-basin Programme(PNMH), Microbacias. Produção auto-sustentada, Brazil.

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(ii) Physical and territorial bases defining an integratedriver basin management system

The physical and territorial bases for defining an integratedriver basin management system depend on a set of situations:

The relative size of the river basin plays an important role indefining a management system for river basin development andselecting the activities to be carried out. In the Spanishlanguage, terms such as “microcuencas” (“micro-basins”), “cuencas”(“basins”), hoyas hidrográficas” (“catchment areas”), “vertientes”(“watersheds”) and “cuencas fluviales” (“river basins”) are used torefer to the relative size of river basins.

The location, geomorphology and climate system on the river basindetermine the organization to a considerable extent. This isimportant since administering river basins in mountainous areaswith high slopes is not the same as administering river basins inrelatively flat zones with marshes and wetlands. Nor is themanagement of a river basin located in an arid area equivalent tothe management of a river basin located in a tropical region. Thetype of measurements, and systems of operation and even traveland communication vary according to the circumstances (see box31).

Box 31

Typologies of river basins, which condition the management systemfor their development (Latin America and the Caribbean)

Relatively medium-sized basins whichsupply and cross major urban centres:Maipo-Mapocho in Santiago, Chile,Rímac-Chillón and Lurin in Lima,Peru, Tieté in São Paulo, Brazil,Bogotá in Bogotá and so on.

Relatively small basins in hilly areas,known in Brazil as “microbaciashidrográficas” or micro-basins,occupied by farmers operating generallywith formal methods and good-qualityland.

developments, and also by largeestablished mining centres andurban centres (basins of theRiver Aconcagua in Chile, Mantaroin Peru, Paute in Ecuador, Negro-Nare River in Colombia).

Relatively large river basins which crossflat areas with relatively few, low-incomeinhabitants and relatively largeproduction centres and urban centres(mostly tributaries of the Amazonand Orinoco zones and a few

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Relatively small, mountainous basins inrural areas occupied by poor migrantfarmers, with no land ownership,in mostly tropical zones (basinsof the Ceja de Selva in Peru, andbasins in Central America, Haitiand the Dominican Republic).

Relatively small, high-mountain basinsoccupied by peasant farmers andindigenous inhabitants with a long ruraltradition and no large hydraulic works,lawfully constituted in ruralfarming communities or othertypes of association, such as themajority of the High Andes andCentral American basins.

Relatively medium-sized mountainbasins occupied by lawfullyconstituted inhabitants with afarming tradition and majorhydraulic

basins in Central America). Very extensive river basins with major

urban centres and large regulatingstructures, typically representedby the basins of the River Plate,the San Francisco River and theMagdalena River.

This typological survey, presentedby way of example, is intendedsolely to draw attention to theimportance of exchanging views on“integrated river basin manage-ment”, given the type of socio-economic and physical situation towhich the proposals refer. The onlyway of arriving at specificmanagement proposals and avoidinggeneralities is by specifying thetype of river basin for whichalternative solutions are beingproposed.

Source: Axel Dourojeanni, ECLAC, 1993.The extent of territorial coverage and the amount of natural resources

covered by the authority define the scope of activities of themanagement system. There are river basin authorities which haveauthorization to act only on the water (a river basin authorityis not the same as an authority administering just one basin’swaters), others only on the forests, others only on the rivercourse, others only on farm work. This means that in some casesit is assigned only the management of an ecosystem (for example,wetlands), in others only the river basin, and in others only oneresource, such as fauna, forests or water.

Something which is sometimes not specified but which has agreat influence on the definition of a river basin managementsystem is the degree of progress attained in the basin’s development (roads,structural works, communication systems) and the natural resourcepreservation, management and protection work carried out.

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B. The formation and structuring of a river basin agency

The internal features of a river basin agency which areinfluenced by the external factors listed and which at the sametime typify a river basin agency include:

The functions of the agency (coordinating, supervising,planning, executing, administering, liaising, consulting,monitoring and other responsibilities connected with theirpowers to impose or not to impose decisions for the resolutionof conflicts between river basin users;

The sources of financing to which the river basin managementagency has access: land taxes, water charges, pollution fines,public money, subscriptions, project funds, donations, sale ofservices and others;

The location, scaling and equipping of the agency (offices,transport equipment, computer support, information systems);

Type of personnel, number and internal organizational operating structure reflecting the complexity and type of management conflict present on the river basin;

Working regulations and functions, and also the annual budget required for the agency’s operation and project investment;

The sphere of autonomy vis-à-vis the State and the agency’s executive committee or board to which the head of the agency is accountable for management performance;

The degree and form of participation of the actors involved inor affected by the management of the river basin (water parliament, river basin committee or other entity, indicating its composition and the relative extent of its participation);

The agency’s hierarchy in relation to other entities acting onthe river basin: degree of coordination, control and other factors, and also the agency’s convening authority.

The entity responsible for directing integrated activitiesin a river basin should be scaled on the basis of the factorslisted above.

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The functions of the institution responsible for directing activities on theriver basin and its degree of coordination with other institutionsare the product of the factors previously listed.

There are functions assigned by work stage: preliminary(studies and project formulation), intermediate (execution ofworks), and ongoing (operation and maintenance, and management andpreservation).

Other functions refer to its degree of authority: executive,coordinating, planning, consultative and administrative.

The management modality and form of participation of the actorsconcerned with the river basin is also determined by the type of actorsusing the river basin and by the functions and legal basis of theentities involved in the management process. Some managementmodalities have vertical authority over the State institutionsand actual users. Other authorities, which are also public, mayact only as coordinators of the activities of other sectors orministries. There are also in existence corporate (river basincorporations), partnership (users’ associations) and othermodalities with different spheres of autonomy in which the publicrole is diminishing.

The range of sectoral coverage which is assigned to the managementsystem is another factor which characterizes a river basin’sauthority. The maximum coverage is operated by river basinauthorities whose functions are multisectoral and encompass theentire surface area of a river basin. In practice, its functionsare those of a regional development authority except that theregion is equivalent to the area of the river basin.

The financing system is also defined by the type of actors present on theriver basin. The various forms of financing, such as land orproperty taxes, service charges, State subsidies, subscriptions,pollution and other payments, funding through investment projectsand, in particular, the amount of funds that can be mobilizedmodify the management system.

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Finally, and no less important is the degree of autonomy orindependence which the legislation prevailing in the country canconfer on the river basin authorities.

These factors should be used to classify the river basins of Latin Americaand the Caribbean for the purpose of establishing management models applicableto each of the situations.

C. Procedures to be followed for scaling or establishing a riverbasin agency

Notwithstanding all that has been stated in favour of integrated river basinmanagement or at least of river basin water management, it is clear that thereare still considerable obstacles to the establishment and operation of water orriver basin authorities in the countries of the region. Proposals forestablishing such authorities still encounter strong opposition,frequently on account of institutional and other rivalries wherethey are confronted with regional authorities and laws. Manyauthorities already in operation for some considerable time stillface strong opposition.

What probably most holds up the establishment or hinders theoperation of river basin authorities is the lack of clarityregarding their roles (and which consequently creates elements ofpotential competition with other authorities) and methods offinancing. Proposals submitted to parliament or discussedpublicly do not appear to be sufficiently detailed. In mostestablishment proposals drawn up by the executive, there is nospecific indication of sources of income, the actors’ form ofparticipation, benefits and costs, the role of the private sectorand of the State, adaptations that can be made according to thetype of river basin, possible investment programmes and forms ofinterlinkage with national and regional authorities. Thisjeopardizes the viability of the proposals.

It can be concluded from these observations that the tangible successesachieved in integrated river basin management and in river basin or at least riverbasin water management are limited (see box 16). River basin water is

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not managed in an integrated manner, a fact evident in thegradual deterioration of the quality of water, degradation ofsoil and vegetation in river basins, overexploitation andpollution of groundwater, deterioration of coastal strips, andgenerally the lack of control over river basin water supply.

Management efforts to improve water supply and quality come from a fewisolated user sectors rather than from any corporation. In addition, thereare transitory coordination efforts to deal with catastrophessuch as flooding or drought, but generally there is no traditionor common practice in the matter, notwithstanding all that hasbeen put forward.

The absence of historical records on how river basins andwater have been administered in each country, the lack ofinformation on the increase in conflicts of use and the lack ofclarity regarding the roles of the different public sectorinstitutions in river basin management, and also the lack ofknowledge concerning their actual capacity to act, complicatestill further the possibility of proposing positive solutions. Insuch cases, it is only when major catastrophes occur thatcoordination measures are taken.

It must, however, be borne in mind that, within a short time, many riverbasin authorities will definitely be established in Latin America and theCaribbean, judging by the number of amendments to the water lawsand codes which include this arrangement. That means that therewill be a considerable demand for training and cooperation inorder to bring them into operation. There is scant materialavailable for such purpose, a problem which has to be overcome assoon as possible by initially preparing educational material, asis currently being done to improve the management capacity oflocal governments and municipal authorities.

The subject of the environment will be an importantcomponent of the management tasks of these agencies. Dealing withproblems of soil erosion and reservoir silting, water pollutioncontrol, urban drainage, controlling flooding and, in general,

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technical aspects at present handled in a partial manner willbecome part of the tasks to be carried out.

Governments must now prepare themselves to face up to thetask, which will mean providing advisory services simultaneouslyto a large number of river basin water agencies so that they canequip themselves, even under private systems, with personnel,communication systems and operating and control systems.

If the legal steps carried out for the purpose ofestablishing river basin agencies take years, it has to be askedwithin what period and how will it be possible to organize wateror river basin agencies that are operational. In particular, itshould be made clear that it will be necessary to extendactivities to cover a very large number of river basins at thesame time, each of which has its own socio-economic and physicalcharacteristics.

The most evident strategy for developing river basinagencies, given the obvious shortage of resources at an initialstage, is to set up river basin agencies in a phased manner. For thispurpose, a number of principles such as those set out below maybe followed:

Begin by creating river basin water agencies rather than riverbasin agencies. River basin agencies have more broadly basedfunctions which are difficult to reconcile with the functionsof regional development authorities. Water agencies arerestricted to water administration and management of thenatural resources “associated” with the river basin water andtherefore have fewer conflicts of competence with national andlocal authorities.

River basin water agencies are therefore to be responsible solely foradministering multiple water use and managing the natural resourcesof the river basin for purposes of protection and preservationof water quality and controlling extreme phenomena. Inpractice, they have to manage the supply of the basin’s waterresources.

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The specific establishment of each river basin water agencyhas to be carried out progressively and be covered by ageneral law so that the scarce resources and efforts can beconcentrated in order to assist the users’ organizations at afew priority river basins while experience on the subject isbeing acquired.

The water users have to participate from the outset in the formation of thewater agency of the river basin to which they belong. A river basin wateragency has to be formed by the actual users and the localgovernment and State representatives and be supported by apermanent technical team serving as its secretariat.

The State may initiate the activities by organizing, for thepriority river basins, a relatively small water managementsystem with the above characteristics but commencing itsoperations with a fixed source of income, for example, on thebasis of a land tax (e.g. $0.5 for each $1,000 of the propertyvalue, per annum).

This management system, which may be called an agency orcorporation, has to request that it be the actual users who organizethemselves by water courses or canals, in order to register them as users andpotential members of the river basin’s water committee or board, and inorder for them to become eligible for technical support andloans.

In the establishment of a river basin water agency, the typeof relationship that the agency will have with the regionaland local authorities has to be clearly defined.

The role of the municipal or district community authorities inwater management within each locality has to be clearlyestablished with the assignment of functions and resources.

The regularization of users, with an indication of water volumes, quality,location, regime and other aspects, may be carried out by private consultants,specialists and lawyers, duly trained and recognized by theState. The regularization of current water uses has to be aprerequisite for the granting of water use rights.

With the funds collected by it, the river basin water agencymust, in coordination with the public and private sectors,equip the basin with systems for measuring water quantity, quality and flow

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rate undertake studies and assist users in technical andfinancial matters.

Decisions regarding special charges and investments will be taken by theusers’ representatives and the other members of the river basin board. Asthe water quantity and quality measurements become morecomplete, it will be possible to determine better the methodsof charging, payment of pollution costs, and the assignment ofcosts and benefits in respect of each installation.

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Part IV

Summary and recommendations forriver basin management in Latin

America and the Caribbean

The concept of the viability or sustainability of development isno more than an abstract idea if it is not associated with clearobjectives to be achieved in specific areas, or with themanagement processes required to achieve those objectives. Themanagement of natural resources within the area of a river basinis a useful means of guiding and coordinating managementprocesses for human development taking into account environmentalvariables. In addition to resolving the so-called environmentalproblems, such management should settle conflicts between thosewho use or depend on those resources or will do so in the future.

If environmental policies are to be translated into action,proper management systems which are, as a rule, extremelycomplex, should be available. The creation of these bodies,particularly at the present time, means creating a financiallyautonomous, mixed public and private system that is sociallyoriented and environmentally aware and one which should alsofunction in a democratic and participatory manner. Theestablishment of bodies responsible for managing the natural

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resources of a river basin, primarily water, has regularlycaptured the interest of the countries in the region with varyingresults. This interest has now developed into an urgent need inview of the increased competition for multiple water use and thenecessity of controlling pollution and managing the environmentin general.

This paper highlights some of the main issues to be takeninto account when the establishment of such bodies is proposed.It also puts forward ideas concerning management at the riverbasin level and definitions of the various approaches taken tothis subject and makes recommendations with a view to improvingpolicy formulation and the operation of integrated water andriver basin management systems. The contributions made can alsobe of use in analysing proposals for the establishment of bodiesfor environmental management.

1. Subjects relating to sustainable development andriver basins

One of the major concerns voiced at present, at least in policystatements, is the need to find viable options for development onthe basis of economic growth, social equity and sustainability.The latter criterion has recently been highlighted given the factthat much of man’s so-called “progress”, particularly in the areaof industrial processing, has been achieved at the cost of damageto the environment.

A greater awareness and deeper understanding of man’sinteractions with the environment and the vulnerability ofdevelopment that fails to take account of these interactions hasbeen made clear by adding the words “sustainable” or “viable” tothe word “development”. Since the sustainability of developmentshould be implicit in the term itself, the words sustainable orviable should not be more than a temporary addition, used only asa means of emphasizing the importance of the duration of thedevelopment in time, until that is implicitly understood from theword alone.

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On the other hand, the sustainability or viability ofdevelopment is no more than an idea or an abstract hope if theconcept is not associated with clear objectives to be achieved in aspecific area containing natural resources and elements that arenecessary for man’s survival as a species, or with themanagement processes to be employed to achieve these objectives.Politics need to be translated into policies, and this is wherethe greatest challenges lie.

In the region, “environmental” problems have been widelyreported, theories have been developed on the environmentalissue, laws have been enacted and ministries of the environmenthave even been established in some countries. However, what havenot been properly developed are the bases for the management ofeach and every natural resource: water, soil, forests, wildlife,minerals and energy and some natural areas such as coastalstrips, river basins or deserts.

In other words, although broad objectives have been set, themeans for their achievement have not been established: thesemeans include organizing territories in order to manage eachresource and thus the environment in general, organizing andtraining the population, researching ecosystems, organizingmanagement systems according to territorial units, strengtheningpublic institutions, particularly the municipal authorities insupport of environmental management, conducting an economicvaluation of natural resources and keeping records of naturalassets, developing guidelines and standards of work, and otheractivities necessary to achieve specific objectives for themanagement of natural resources and the environment in general.

The management of natural resources with reference to riverbasin dynamics, better known as watershed management, is thusemerging as one of the possible options for involving the usersof natural resources in environmental management. The river basinhas a unique value as a basis for coordinating the users of ashared resource such as water and for evaluating the impact ofenvironmental management on water. The quality of the water is to

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a large extent an index of environmental management capacity onthe river basin.

2. The characteristics of water and river basins

A river basin is an area which is bounded by nature itself,81

being essentially delimited by the borders of the drainage areasof the surface waters which converge on one and the same channel.The river basin, its natural resources and its inhabitantspossess physical, biological, economic, social and culturalfeatures which lend them characteristics that are peculiar toeach.

Physically it represents a natural source for the catchmentand collection of surface water and groundwater, and it thereforehas an essentially volumetric and hydrological character. At thesame time, the river basin, and particularly the water capturedby it represent a means of human survival but also a threat whenextreme natural phenomena occur or pollution damage arises.

In upland areas, and mountain ranges, river basins formnatural communication and trade routes, whether along the riversor along the line of summits separating them. In other words,there are mechanisms of close interaction between theirinhabitants which lend them particular socio-economic features.

In river basins with high water discharge rates and wide,relatively flat valleys, the axis of the river also becomes anarea of interlinkage among its inhabitants, particularly through

81Guillermo Cano and Joaquin Lopez state, in a paper entitled “Las cuencashídricas como unidades óptimas para la planificación y administración de los recursos hídricos:participación de los usuarios en tales actividades” (“river basins as optimum units for waterresources planning and management: user participation in such activities”),prepared in 1976 for the fiftieth anniversary celebrations marking theestablishment of the River Basin Confederations in Spain, held in Zaragoza,that “God has laid down the lines of separation of the water as natural limitsof river basins. Man, for his political and administrative needs, has drawnother lines, which generally intercross and do not coincide with the naturallines”.

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the use of the river channel for navigation, transport andcommunications.

The territory of river basins facilitates connectionsbetween their inhabitants, whether or not they are groupedtogether in districts for political and administrative reasons,owing to their common dependence on a shared water system, onroads and access ways, and on the fact that they have to contendwith common dangers. Where there are no systems for reconcilinginterests between the different actors who depend on the sameriver basin, conflicts will arise between them.

This is certainly a pronounced feature of inhabitedwatersheds located in high mountain ranges, but it also occurs inwide river basins with water control structures which benefit alltheir inhabitants, and thus create a common dependence.82

River basins show up the negative impact of man’s actions onhis environment, particularly through water pollution. This is,for example, embodied in the principles underlying theestablishment of river basin agencies in France, which maintainthat “the aquatic medium is an entity which provides a habitatfor and supports an entire animal and plant world, its waters andbanks forming a special biological edifice. Man’s thoughtlessinterference with just one of these elements disturbs thisfragile balance and causes a general impoverishment of thenatural environment”. These principles accordingly assert thatharmonious management of water resources calls for:

The acknowledgement, first and foremost, of the unitconstituted by a hydrological or hydrogeological basin;

The recognition that consideration for and preservation ofthis unit are essential requirements for optimally meeting thewater demand of different users;

82No distinction is made in the Spanish language between “watershed” and“river basin”. Both terms are translated as “cuenca hidrográfica”, althoughattempts are made to distinguish between them by using expressions such as“cuenca fluvial” and “hoya hidrográfica” to refer to “river basin” and “cuenca de altamontaña” or “cuenca de captación” to refer to “watershed”.

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The recognition of the need to define specific and appropriateobjectives for each area or territory and to carry out thenecessary structural works and activities for the attainmentof such objectives;

The acceptance that all users have a legitimate right to waterand that, consequently, each of them is subject to similarlimitations regarding his or her own use.

The river basin is a natural unit which is highly suitableas an area for coordinating management processes which may beconducive to sustainable development. For its part, theadministration of water management processes has its owncomplexity (see box 32).

Box 32

Complexity of the water management process

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This is a process which is intended to control the cycle of a naturalresource whose presence is erratic and irregular over time and over theearth’s surface. Also, it is vulnerable to the treatment which it isgiven, since it may easily be polluted, with all its present, subsequentand potential uses thus being impaired.

It is a process which seeks to resolve conflicts among multiple userswho, whether they like it or not, depend on a shared resource.Consequently, although they may obtain licences or rights of use, theywill still affect each other and be interdependent. Supply usually comesfrom a common system, to which surpluses and effluent are reintegrated.Surface water, groundwater and atmospheric water, and also evacuationzones, thus form a single unit.

Within this process, any activities which are carried out have hugerepercussions on human health, the environment and production, andtherefore have to be approached in a highly technical manner. The highcost of structural works, and also the long lead-time of water controlprojects make it even more necessary for the management system to beentrusted to experts whose permanence does not depend on politicalchanges.

The water management process calls for the coordinated action of manyagents, notwithstanding their differing viewpoints or the fact that someof them are unaware of the effects of their decisions on the watercycle. Hence the importance of having stable coordinating mechanismsand, at least, a permanent river basin centre or authority.

Source:

Axel Dourojeanni, ECLAC, 1991

3. The river basin as a territorial option fordirecting environmental management processes

The territory covered by a river basin is certainly not the onlyarea within which environmentally sensitive developmentactivities can be directed and coordinated. The boundaries of thesurface waters forming the river basin do not necessarilycoincide with the groundwater boundaries; they obviously do notcover the areas of the seas, where a major part of the water

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cycle is generated, and they are less extensive in relativelyflat and extremely arid areas.

The use of the territory covered by a river basin forenvironmental management purposes is therefore only one option,whose validity depends on the geographical features where it islocated. It is an important option from the environmentalviewpoint because, as has been mentioned, it facilitatescoordination between users who are linked to one and the sameresource, such as water, and, in particular, it facilitates themonitoring of progress in controlling pollution through itseffects on water quality. This does not, however, mean that theterritory of a river basin is the only area required for managingnatural resources or the environment in general.

This observation is important to debunk the belief held bysome that a region’s entire development or environmentalmanagement can be directed exclusively on the basis ofdemarcations provided by river basin boundaries. It may be saidthat consideration of the boundaries of river basins is arequirement for considering environmental aspects, particularlyof water and its “associated” resources, but it is not sufficientas an area of jurisdiction for managing human development.

In this respect, it is essential that any river basinmanagement proposal take into account its relationship tomanagement systems which operate with other boundaries, inparticular politico-administrative borders, among whichmunicipalities take precedence (see box 33). It should be made clearthat river basin management processes have to be pursued incoordination with the various public and private authoritiesacting on the territory of the river basin.

For example, river basin management activities which takeaccount of municipalities, such as those undertaken in theChicamocha river basin in Colombia,83 where 74 municipalities are

83José Acero Suarez, “Proyecto para la Recuperación y Manejo de la Cuenca Hidrográficadel Rio Chicamocha” (“Project for the recovery and management of the ChicamochaRiver Basin”), INDERENA River Basin Division, published in the review Colombia

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involved, have a far greater likelihood of success if the localauthorities are concerned with, and have responsibilities in, theexecution of some project activities. Conversely, a municipalprogramme aimed at improving the environment or controlling itsnegative effects should take into consideration the impact ofriver basins entirely or partially contained within its area ofjurisdiction.

Hídrica of the Colombian Association of Water Sciences, pp. 13-17, Year 6,Issue 8, Santa Fé de Bogotá, Colombia, May 1993.

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Box 33

Beyond the privatization debateAccording to Barraqué, recent thinking onthe subject has yielded numerouscontributions emphasizing the trend towardsprivatization that appears to characterizewhat he terms “the water industry”, i.e. allenterprise activities for the purpose ofusing water, and water policies throughoutEurope.

An analysis of five water resourcemanagement policies in Great Britain,Germany, France, Italy and the Netherlandsreveals a marked diversity of approaches,but also indicates that the traditional debatebetween the role of the public sector and the privatesector in water management appears to be somewhatsuperceded and even slightly obsolete.

Barraqué argues as conclusions to hiscomparative analysis that the privatizingview is an oversimplified view whichdisregards the profound changes which areoccurring in water management. These changesrange between the dichotomy of theefficiency of large-scale management systemsversus small-scale management systems andthe dilemma of separating or integratingwater management systems (regardless ofwhether they are public or private).

The most significant aspect of theanalysis is the discovery that in all thosecountries these dichotomies have beenresolved by reconciling two water managementlevels. There in fact exists in all thosecountries a dual level of water management:regional, large river basin level, directed towardsthe formulation and application of plans andthe execution of water policies for multiplewater use which will permit theirimplementation (coercive or incentive-basedpolicies) and a local, district level, directed

Rather than a simple change to privatefinancing and management, what is happeningis a process in which all the actorsinvolved with water (industrialists,hydraulic engineers, housewives, publicadministrators and water users in general)are playing new roles in new watermanagement scenarios. The hydraulicengineer can no longer be a distantindividual removed from environ-mental,social, legal, biotic and other needs, norcan he alone decide on the design of asystem without the participation of theusers, who additionally have to be trained.

There is one very valid reason forthis change in the countries of Europe.Quite simply, there is no longer any scopefor increasing water supply. Thesecountries are confronted by a physicalbarrier which prevents the use of oldpolicy-making styles which support theconstruction of new projects solely to meetincreasing demand through the harnessing ofnew sources by means of major hydraulicengineering works. What they require todayare policies to manage the other side ofthe demand system and, in particular, waterquality control.

The subject of managing demand hasrequired greater community involvement. Itis not possible to reduce per capita waterconsumption or water pollution, or toachieve increased efficiency of water usein industrial processes without the supportof the population (just as the population’scooperation is necessary, for example, insorting and disposing of glass, paper andother waste in three receptacles in theirown homes before being picked up bymunicipal refuse collectors).

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towards the operation of services and theimplementation of innovative policies suchas urban hydrology.

Another important fact, whichcontrasts with the recent approaches inLatin American countries, is that water isincreasingly being recognized as common property andthus the scope of individual water rights isbeing limited or restricted. This has,however, necessitated major changes inattitude on the part of the actors and thedevelopment of complex policies whichrequire some degree of consensus among them.In this way, the legitimacy of uses isshifting from partnership schemes with freeaccess to the resource, based on privateownership (and forms of organization throughcouncillors and sponsors) towardspartnerships with access based on alliancesor contractual arrangements between “users”.

The necessary inputs for achievingsuccess in improved water management havethus ceased to be solely engineering works,major capital investments and the need tohave unlimited water resources. Themanagement matrix is now becoming a systemthat has to be handled in a more socializedmanner (but with full technical andscientific know how and commitment on thepart of the actors), concerned more withenvironmental engineering and thus morecomplex.

Harmonization between management atthe river basin level and the local levelis thus essential for achieving thatobjective. Potentially, there can be usefulinterchanges between the local level andthe river basin level provided that thelocal level has the expertise and skills toconduct them.

Source:

Based on Bernard J. Barraqué, “Water management in Europe: beyond the privatizationdebate”, study published in the review “Economia delle fonti di energia e dell’ambiente”, yearXXXVI, No. 3, 1993, document of the Istituto di Economia delle Fonti di Energia, L.Bocconi University, March 1994, Milan, Italy.

In the case of large-scale river basins, the sameinterlinkage occurs between authorities with politico-administrative boundaries and natural boundaries. For example,the management of an integrated management or development projectconcerning a major river basin has to coordinate with thedevelopment authorities of the region where the basin is located.In many instances, the lack of such coordination has meant that,one of the two authorities (the river basin development authorityor the regional development authority) has absorbed the other orthey simply coexist in permanent conflict.

4. Definitions and aspects of river basin managementprocesses

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The topic of river basin management has been evolving over a considerable periodin the region but, despite the progress achieved, there is still no consensusregarding precise definitions of the objectives of such management. The lackof conceptual clarity in river basin management continues toundermine the sharing of experiences between countries, leads tothe overlapping of functions and, in particular, hampers theformulation of related policies and laws.

Table 1 gives a synoptic classification of the meanings andinterpretations employed in dealing with the subject of riverbasin management in Latin America and the Caribbean. The purposeof this classification is to facilitate comprehension of theactivities which may be coordinated in a river basin and of theaims of such coordination.

The table indicates the term used, in both English andSpanish, to designate types of river basin management. It hasbeen constructed by bringing together two groups of factors: (i)the stages on the river basin management process; and (ii) thequantity of elements and resources taken into consideration inthe management process.

The stages in a river basin management process (1, 2 and 3): - Preliminary (1) : studies, planning and formulation of

projects.- Intermediate (2) : investment in the preparation of the river

basin with a view to the utilization and management of itsnatural resources for purposes of human development. Thisstage is associated in English with the term “development”,e.g. “river basin development” or “water resourcesdevelopment”, terms which are normally translated in Spanishas “desarrollo de cuencas” or “desarrollo de recursos hídricos ohidráulicos”.

- Ongoing (3) : operation and maintenance of the completedstructural works, and management and conservation of thenatural resources and elements. In English, this stage isassociated with the term “management”, which in Spanish hasas many as four renderings: “gestión”, “administración”,“ordenamiento” and “manejo”. In general, “water resources

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management” is translated as “administración de recursos hídricos”and “watershed management” as “manejo de cuencas”.

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The quantity of natural resources and elements taken into consideration onthe river basin management process (a, b and c):

- First group (a) : all the elements, resources andinfrastructure built by man in order to develop the riverbasin to meet his vital needs.

- Second group (b) : all the natural resources and elementspresent in a river basin.

- Third group (c) : only the utilization and management of thewater or water resources.

This is an original approach to the analysis of the terms. It ishoped that this classification will help clarify conceptsrelating to the objectives of river basin management. The tableindicates both the English terms and the meanings of theseexpressions in Spanish, the aim being to facilitate comprehensionof the terms in Spanish by relating them to the original conceptunderlying them.

The entities responsible for each of the above-mentionedtypes of river basin management may elect to be designated ascorporations, enterprises, agencies, commissions, authorities,programmes or projects, directorates, bodies, boards orassociations. Each country’s legislation lays down in general theroles and legal powers of each of these types of organization, towhich should then be added the specific functions relating toriver basin management processes and the appropriate forms ofpublic and private participation.

5. The evolution of river basin management systems

The subject of river basin management has been associatedhistorically with the main cultures and civilizations that haveevolved, and in some cases disappeared, depending on theavailability of water. However, by having virtually permanentaccess to water urban man, who represents the majority in manycountries, has been losing sight of his dependence on water, and

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even watercourses, to the point of total oblivion. Moreover, hehas become accustomed to demanding that water supplies beincreased rather than offering to reduce his consumption on thebasis of better use. Nor does he fully appreciate that water is ascarce resource, whose presence fluctuates over time and whosecontrol requires major investments that have to be planned yearsin advance.

Every so often, however, he is reminded of his dependencewhen he suffers flooding, prolonged drought or visible pollutionof water. Evidently, however, this situation does not always lastlong enough for him to organize or coordinate his actions duringthat time in order to better balance water supply and demand witha long-term vision and, most importantly, to establish stablemanagement systems with guaranteed financing.

Owing partly to such fluctuations in the perception of thevalue of water, the evolution of river basin management (aimed atcoordinating activities in a river basin for different purposes)in Latin America during the present century has been neitheruniform nor stable. Management systems have changed gradually andirregularly, and in several instances management, at least ofwater, tended to be better organized in the past than it is now.

In its initial stages, coordination of river basinactivities was limited. Work was performed taking the river basininto account in order to resolve isolated problems or meetspecific or sectoral water needs: guaranteeing and improvingnavigation, supplying water to centres of population andirrigation areas, ensuring flood control and drought relief andconstructing hydroelectric power stations.

The next step consisted in operating and maintaining theworks completed. This management was limited to the constructedsystems, with no further interest either in multiple water use orin “managing the river basin” (i.e. managing the basin’s naturalresources). Accordingly, in the region, a series of river basinwater management systems was implemented, a large proportion ofwhich were concerned only with the sectoral use made of thewater, as in the case of irrigation (Oversight Committees in

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Chile, Technical Administrations of Irrigation Districts inPeru).

The late 1940s saw the establishment of commissions (Mexico)and corporations for integrated river basin management (regionalriver basin development). These corporations were supportedthrough the construction of hydraulic works designed to coverextensive territories under their jurisdiction and undertakeinvestments in numerous sectors.

In more recent times (1970s), the subject of “river basinmanagement” appeared, chiefly with the aims of reducing sedimentbuild-up in constructed dams and controlling landslides andflooding. Instances where all the natural resources of the riverbasin (flora, fauna, forests and land) are managed with a view totheir utilization and conservation were rare. Agricultural,forestry and livestock projects have helped to improve thissituation but do not make up for the lack of a coordinatingsystem for river basin natural resource management.

The subject of the environment emerged rather later in LatinAmerica (five to seven years after the Stockholm meeting in1972). Environmental impact studies began, followed byenvironmental analyses. To a large extent, environmentalmanagement has not passed beyond the study stage. If there is nocoordinated management of natural resources, or even of water, itwill be impossible to undertake “environmental management”.

The most important aspect to be emphasized in this evolution is the factthat there has been an abrupt transition to the coordination, at least on paper, ofenvironmental management at the river basin and regional levels84 without thereyet being full coordination of development and management activities of at leastsome of the main natural resources in a river basin, such as water.

84This is corroborated by the establishment of the Regional AutonomousCorporation (31) in Colombia, attached to the Ministry of the Environment (LawNo. 99 of 16 December 1993). The function of these corporations is to executenational policies concerning natural resources and the environment.

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At the present time, the topic of river basins has regainedcurrency. It is hoped that the classification and historicalreview of the subject will enable proposals to be made regardingappropriate agencies to undertake the type of management requiredin each case. It is important to salvage the valuable experiencesof the past.

During the last decade, the combination of greaterenvironmental concern and the increasingly marked impact ofnatural phenomena such as flooding on structural works built byman, together with the appearance of epidemics such as cholera,appears to have raised awareness somewhat, not only for social orenvironmental reasons but primarily for economic reasons. The floodswhich occurred in North America and Europe in 1993 causedextensive losses, which demonstrates that the topic is notexclusive to less developed countries. Pollution of some of thelakes in southern Chile is potentially catastrophic, not onlyfrom an ecological or an emotive viewpoint but also because itwould mean significant financial losses. It seems that theseeconomic considerations rather than environmental ones willultimately prompt politicians and decision makers to turn wordsinto action.

However, this concern has still not been translated intoreality in Latin America and the Caribbean through theestablishment of appropriate water management organizations. Itcan generally be said that water management, viewed both as anational system and as a water management system at the riverbasin level, has the support of many people and institutions buthas still not been fashioned into sound and stable systems(public, private or semi-public), except in rare cases involvingriver basins where for a particular reason there have been majorinvestments in hydraulic engineering works.

6. Recommendations for avoiding failures in water andriver basin management processes

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In order to deal with the various causes affecting environmentalmanagement at the level of river basins, their natural resourcesor water only, it is necessary to refer to the discussions takingplace today with a view to defining the respective roles of thepublic and the private sectors. It is also necessary to deal withthe issue of water policies and their interlinkage with economicand demographic policies. Only with such information is itfeasible to determine what would be the most appropriatemanagement systems for addressing the issue of the environment ingeneral and that of river basin management as a part of it.

Experience has shown that it is possible to gradually worktowards the formation of an agency which can fulfil at least someof the basic roles such as averting, lessening or resolvingconflicts between water users. In order to carry out this task,it is initially necessary to acquire information on at least thefollowing aspects:

The public policies relating to water resources and theeconomy;

The specific features of water resource and river basinmanagement;

The features of water management systems and the actorsinvolved;

The most appropriate methods for the operation of apublic/private entity responsible for water and naturalresource management in a river basin.

The path of rigour has seldom been followed by the countriesof the region in the formulation of water policy. It is generallyundertaken on the basis of the immediate economic situationwithout an established procedure being followed. As mentionedearlier, water resources policies in the region have in someinstances favoured the formulation of plans, in others theredrafting of a law (not as the culmination of a process ofpolicy-making but rather as the initiation of such a process), inyet others the establishment of organizations and so on. However,it is a matter of concern that the vast majority of theseproposals are not properly harmonized, whereas the organizational

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systems, laws and plans, to mention but a few components of anexecution policy, have to be well coordinated.

Measures are thus taken which are either partial or merelyaimed at not conflicting with an economic system, strengtheningthe application of other laws (such as the drafting of theGeneral Waters Act in Peru, with the aim of supporting the 1969Agrarian Reform Act), easing isolated and sometimes incidentalconflicts between users, appealing to particular groups of votersor accommodating a regionalization project. In suchcircumstances, water policies are normally formulated in a patchyand incomplete manner.

Although these policies have to support national developmentpolicies, it should be recalled that both water resources and theprocesses for their development have specific features whichcannot be disregarded without glaring contradictions opening. Asearly as 1970, Irving Fox warned of the problems created byattempting to link water management to a free market economywithout taking into consideration the particular aspects of thecase. The specific features of water as an economic resourcenecessarily require, if not the preponderant participation of theState, as Fox maintains, then at least joint management betweenthe State and the users in administering water supply from ariver basin or interconnected system (see box 17).

The regionalization policies of some countries have givenrise to major incompatibilities between development policies andwater policies. On several occasions in Peru, for example, as aresult of the regionalization programmes applied by variousGovernments, some river basin authorities which had been attachedto the central Government were suddenly under the direction oftwo or even three regional authorities, since the river basinarea which they administered was split by the boundaries of morethan one region.

The purpose of a river basin management agency reflects theduty of States to safeguard the natural heritage of nations. Suchan agency could be a public, private or semi-public entity and

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may take different juridical forms, but it is essential that itshould operate efficiently and effectively and serve its userswhile at the same time ensuring compliance with domestic environment law anddischarging its managerial function with the participation of the actors, includingmunicipal authorities, present on the river basin .

With regard to economic policies, the river basin managementagency is usually assigned, for purposes of its financing, partof the income generated by the exploitation of the naturalproductive capacity of the region’s natural resources. Thisearning power partly depends on the biological and physico-chemical features of the natural resources enabling them toincrease their biomass and sustain themselves in nature throughtheir lifecycles. For example, the harnessing of hydropower isthe appropriation of a natural asset. Regrettably, the economy ofnatural resources is still a subject in its infancy but one that may yet assist inmore judicious decision-making aimed at defining sources of financing for theirmanagement.

7. Recommendations for improving the formulation ofintegrated water and river basin management policies

There are a number of basic considerations which have to beobserved if it is sought to formulate policies with a minimum ofconsistency regarding management of the environment, naturalresources or water alone. It should be borne clearly in mind thatif the policies themselves are inconsistent, the managementagencies responsible for implementing them will be also.

In principle, it is evident that not just any policystatement will necessarily qualify as either politics or policy.To do so, it has to be composed of basic rules, organizationalprinciples and fundamental procedures.

It is also necessary for any pronouncement of changes or thepromulgation of new policies to be based on clear analysis of theadvantages and disadvantages of applying the policies currentlyin force. In no circumstances would a new policy be expected to

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make the situation worse or undermine the effectiveness ofanother, newly promulgated policy.

It is also important that the assumptions implicit inpolitics should be tested by applying rigorous methods, such asthat indicated in the sequence of management procedures forsustainable development.85 This is a vital precondition makingthe transition from politics to policies.

In environmental matters, including water and other naturalresources, it is necessary to understand and to incorporate inthe water policy statement the restrictions imposed by thebehaviour and requirements of the environment in general and ofwater in particular. The natural system does not modify itsbehaviour simply because human society decides to change thesystem or form of government or the economic or commercialsystem.

Without doubt, environmental and water policy statements inparticular require that consideration be given to the prevailingeconomic policies and to the roles of the private and the publicsectors and of the regional and district actors. This is the keyto determining the policy instruments to be employed and also thetype of organization needed to apply them.

In environmental, natural resource management or watermanagement policy statements it is necessary to specify theorganizational system that will be applied under the policiesand, in particular, the economic instruments that will be used toensure that the system can function regardless of whether it ispublic, private or semi-public.

85Axel Dourojeanni, Procedimientos de gestión para el desarrollo sustentable (aplicados amicroregiones y cuencas) (Management procedures for sustainable development(applied to micro regions and river basins)), Latin American and CaribbeanInstitute of Economic and Social Planning (ILPES), Document 89/05/Rev.1, SerieEnsayos, Santiago de Chile, October 1991; and Axel Dourojeanni and Juan Gómez,“Sistema de gestión del agua en la cuenca del Rio Mapocho” (“Water management system inthe Mapocho River Basin”), Records of the Seminar on Management of RenewableNatural Resources in the Itata River Basin, University of Concepción andProvincial Government of Ñuble, Chillán, Chile, 22 November 1991.

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One of the conditions dictated by the environment iscontinuity of action. In other words, an environmental managementsystem has to endure beyond the life of a Government. For thatpurpose, it is necessary that the policy statement be accompaniedby a preliminary draft law and regulations fostering thenecessary continuity in the management system, in order toguarantee its financing, effectiveness, adaptation andlegitimacy.

To be successful, an environmental policy also has to beunderstood by the public. It is therefore important to indicatewho participated in formulating the policy and who will beinvolved in its subsequent application, and also how thedecisions were taken. The role of all the actors and theirrelative participation in the process of applying and adhering topolicy instruments will need to be specified in order that theyfeel involved.

Reconciling economic and environmental objectives is a keyfactor because of its crucial importance when attempts are madeto apply a social and market economy. Both objectives can beachieved to the degree that the behaviour of each system isclearly laid down and mechanisms devised for reconciling them.

In environmental policy-making especially in relation towater, a natural system (ecosystem, river basin) or a singleresource such as water is often arbitrarily divided, formanagement purposes, according to user groups, sectorsresponsible for its control, types of use (consumptive or non-consumptive), the source where the water is captured (whethersurface water or groundwater), river sections or stretches, andother similar arbitrary factors.

The natural system is arbitrarily fragmented and, as a result, themanagement of a naturally integrated system is also carried out in fragmentaryfashion. For the above-mentioned authors, with reference to theintegrity of the water system, it is not sufficient torationalize the supply of water to each user in terms of quantity

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and quality unless consideration is given to the way in which itis to be returned to the environment (quantity, quality, time andplace). The restoring of the resource may have both negative andpositive effects. For example, a large quantity of domestic wastewater reduces the concentration of chemicals in the liquidindustrial waste dumped by enterprises and facilitates itstransport.

The concept of “water economy” is of no significance in thematerial sense, where the ideal is to minimize the quantity ofwater extracted from the system or used in a process. If it isreutilized in other processes, it may prove more cost-effectiveto use more water in the initial process. For example, limitingthe water used for irrigation in some areas gives rise toincreased costs and a greater concentration of salts in the soil.However, if the water can be harnessed, treated and reutilizedsubsequently, it could be more economical to use more water inthe initial process.

It is not sufficient to assign water uses by sector(domestic, agricultural, industrial) unless consideration isgiven to their interactions, since a conflict will arise betweeneach type of demand and the supply system (groundwater forirrigation, river water for industry, section of river forassociations of irrigators, extraction of river bed material formunicipal authorities). The physical units of the supply systemare arbitrarily divided according to the different uses in thesame way as a river is divided up into sections assigned todifferent user groups, disregarding the effects of theirinterdependence along the course of the river. With such anapproach, water demand is sometimes forecast purely according tothe classification established for its supply (groundwater demandfor towns, river water demand for industry).

Demand is almost always evaluated according to quantityrather than quality, as if the two criteria could be separatedfrom one another. The fact is overlooked that the two factorsinteract at each of the points at which water is restored to themain system, and that extracting or returning water gives rise to

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changes in quality and in the capacity of the environment toabsorb certain pollutants.

The value of water as an input in a production process isoften assigned without reference to the interaction betweenextraction, use and return. For example, when water is assigned avalue, there is no precautionary cost allocation for thepollutants which will be discharged into a watercourse when acertain quantity is returned; nor is any charge made for the useof water as a means of conveyance, and sometimes as a diluent ofwaste, in addition to its use in a production process.

The costs of negative external effects or “externalities”,such as pollution caused by the use of water as a means of wasteconveyance, are ultimately “factored in” in accordance with thepolluter pays principle. However, this rule is usually appliedafter a period of several years during which industry has beendamaging the environment and users have started to complain. Toavoid this, preventive steps have to be taken as regards bothcharging and the application of decontamination measures.Initially, a time lag will occur between the time ofcontamination of the water and the time at which clean-upoperations are initiated. What happens is that no account istaken at the outset of the fact that the user will not only beusing water in its production process but also as a means ofconveying its waste, a factor that can be calculated and chargedfor at the beginning, with an estimate even being possible of thealternative cost for the factory of using lorries to transportits waste rather than using water and river courses.

The above situation is exacerbated exponentially becausewater supply management systems, which are also fragmented, donot have any coordination mechanisms. Some deal with waterquality (such as health ministries), others with the extractionof aggregate (such as municipal authorities or ministries ofmines), others with river defences, others with groundwater,others with granting water use rights and so on. Lack ofcoordination leaves a succession of gaps in management. This alsoexplains why many “plans” or “scenarios” formulated by these

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entities do nothing more than extrapolate the fragmentationsreferred to. For example, each sector projects its own demand,taking no account of the impact it will have on a river basin orhow it will affect supply and the interaction between types ofdemand. Hence the scarcity of proposals put forward for reducingdemand at the initiative of the sector itself, which draws up itsplan independently. All the parties demand the “maximum” and, ifthey can, acquire as many water rights as possible on aprecautionary basis. Disputes arise over what is needed today andwhat may be needed tomorrow.

Consequently, virtually no sectoral policy seeks to reversedemand trends by, for example, relocating industries to moreappropriate sites; rather, attempts are made merely to satisfydemand. No consideration is given to the option of simultaneouslyacting on both supply and demand because there is no integratedmanagement system in existence that depends primarily on the users themselvesand under which measures might be proposed for both the individual and thecollective benefit in order to achieve economies of scale.

In the absence of integrated management policies, technicalrationale is mixed in with economic rationale, and the latter, inturn, with financial rationale. Rather than opt for a rationalein the choice of objectives that will help resolve competitivesituations (it should be recalled that water management isconflict management), a technico-financial rationale which isuseful and reasonable for each individual sector but unreasonablefor the whole, is ultimately adopted so much so that greaterlosses are caused to each (increased costs of water regulationand harnessing, control of extreme phenomena anddecontamination).

Maximizing the economic and water-related benefits for eachsector works against the achievement of an optimum benefit forthe whole. The end-result is a social, economic and environmentalloss for all. To see water economy as a “material economy” of theresource is to confuse the issue. It would appear rational toeconomize on water and thus reduce consumption; it is alsorational to choose the cheapest water supply solution (in

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financial terms); however, these two concepts are contradictoryand sometimes incompatible if taken as part of one and the sameobjective.

Where there is no integrated management system, what happensis that the benefits generated by one actor for other water users(such as mitigation of the effects of flooding or drought throughthe construction of a dam for a hydroelectric plant) are neitheracknowledged nor paid for. By contrast, those affected will claimand sometimes even charge for the negative effects that arise.Consequently, water management and economic management have to beviewed “top-down”, in an integrated manner and not by parts. Iffragments are analysed, the erroneous conclusion may be reachedthat “optimizing” each water use in material terms means that theeconomy is also “optimized”. In practice, the economy will reachits best level when the entire system is analysed.

The choice of the most appropriate economic managementinstruments can only be made if this integrated approach isadopted.

8. Recommendations for improving the proposals forthe establishment of river basin agencies

In principle, it is possible to correct the disorganized andunsustained way in which management solutions are usually putforward for improving the utilization of natural resources. Sincethis document deals with river basin agencies, the most importantaspects connected with such management systems have been listed.

The partial list of points that have to be incorporated insuch a paper is aimed at avoiding and dispensing with theapproach usually employed to date in the formulation of proposalsfor improving the management of public or semi-public entitiesresponsible for environmental, natural resource or watermanagement. The usual approach is normally based more onintuition, improvization, emotion or political accommodation thanon strict analytical work.

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It is customary, for example, to propose the establishmentof a commission to study the situation and issue a diagnosticsurvey; formulate a plan, preferably a “master plan”; alter thenames of the competent public agencies; combine or split upinstitutions or parts of them; relocate offices; change thepersonnel in charge of the agencies with each change of higherauthority; establish new reliable posts or “authorities”; entrusta “reliable commission” with the task of amending the legislationin force; hand over full managerial responsibility to the usersthemselves and relinquish the role devolving upon the State orvice versa; seek support from an international organization orbilateral aid agency under a project; apply for a soft creditline or bilateral donations; convene expert group workshops orseminars to discuss the topic and engage in lobbying; modify thescope of environmental management; and decentralize or centralizemanagement power.

Any one of these measures may potentially be excellent;however, for it to be put into practice, a set of requirementshas to be met, which rarely happens. These preconditions includethe following:

The recommendations must be duly based on analytical studieswhich take into account the existing situation and all aspectsinvolved in a change of management system;

The time when the proposal is made must be politicallysuitable and determined in accordance with interests of thecountry;

The actors participating in the water management systems mustbe aware of the importance and necessity of cooperating sothat water management is integrated;

The users themselves must be capable of financing themanagement process from their own contributions;

Specific tasks must be assigned and the agreements between allthose involved in the various water management levels must beclear.

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With the aim of correctly designing proposals forestablishing river basin management agencies, it is recommendedthat the questions set out in box 34 first be answered.

These are the types of questions that have to be clarifiedbefore a proposal can be made to establish a river basinmanagement agency or solutions can be put forward for thoseagencies which, although established, are not yet operational. InLatin America and the Caribbean, many laws are at a standstillbecause they were not fully and appropriately drafted. Lack ofclarity gives rise to negative reactions before the system comesinto being, particularly if its functions and tasks are notcorrectly laid down.

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Box 34

Questions relating to the design of proposals for establishingriver basin management agencies

What type of agency is being proposed, according to the classification set out in table 1? Who is proposing the establishment of this agency and why?

What developments have other river basin agencies undergone within the country? What were these agencies and what experiences have they had?

What would happen if no system for coordinating activities on the river basin were introduced?

Is it necessary or unnecessary toundertake any coordination of theactivities carried out in a riverbasin? What activities should be coordinated? What actors are involved?

Who is currently responsible for carrying out river basin activities which should be undertaken in a coordinated manner?

What would the participating actors gain if they coordinated some major activities on the river basin , such as multiple water use? Would the present situation change? How?

What would the actors lose if a system were to be set up to coordinate major activities on the river basin?

What are the main obstacles whichcurrently prevent a coordinated system for managing river basin activities from becoming operational?

What type of system is it necessary to set up in order to coordinate activities? An authority (corporation, agency),office or technical secretariat? A simple coordinating commission?

What functions and tasks would such a system or agency have? What aims would it pursue? How would the river basin users be represented? What legal force would the different actors have in the decision-making?

What entities currently existing within or outside the river basinare able to assist the tasks of the agency that is being proposed(e.g., the judicial system, the police system and rural training and extension services)?

What system of financing would exist for the agency that is being proposed? Who would contribute there sources for coordination activities, when, how much and how? What collectionsystem would it use? For what purposes would the mobilized funds be allocated?

How would the agency be organized? With what information system can it operate?

What legal powers would it have to implement agreements taken with a view to coordinated actionon the river basin ? Would it be able to put forward plans for theexecution of coordinated activities? How would it guarantee their application?

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What types of argument are putforward by the various actors infavour of and against the estab-lishment of a system forcoordinating activities on theriver basin?

Source:Axel Dourojeanni, ECLAC, 1994.

9. Future tasks

The present document is seen as a first attempt to compile andassemble a wide range of information on public policies directedtowards promoting sustainable development on the basis of riverbasin management.

The next task will thus be to conduct case studies for thepurpose of analysing, expanding and consolidating the aspectsdealt with and adapting them to the conditions prevailing in eachcountry.

There are many aspects still under discussion, such as:

Defining policies concerning the granting of “water rights” asa means of fostering water markets, the trend in otherregions, such as western Europe, being increasingly that ofviewing water as a national heritage with a tendency towardswater management in a more social and corporate form by allusers and not solely by those possessing “water rights”;

Defining the role of the State and the role of the privatesector in the management of natural resources, particularlywater. One aspect still not dealt with is the definition ofstrategies for transferring of water management functionstraditionally assumed by the State to private users, bearingin mind that many users, such as irrigation users, are not yetstructured and do not have an integrated river basinmanagement culture in many places (they are not even able yetto operate and maintain their own irrigation districts);

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Defining the way in which river basin agencies would beorganized in areas where the river basin population is mostlymarginalized, informal and poor, as is the case in manyPacific coast regions in Ecuador and Colombia and theheadwaters of the Amazon in Bolivia, Peru and Ecuador. Theseinhabitants are recent migrants who possess no traditionalorganizational structure, have no title deeds and are for themost part hillside farmers.

Defining methods and sources of financing for at leastcarrying out coordination activities among a river basin’swater users. For example, the 1993 budget of France’s riverbasin agencies was approximately $2 billion (see box 21). Howmany river basin agencies in the region would together receivea similar annual income?

The definition of decentralization and regionalizationmechanisms and enhancement of municipal roles and capacitiesare still in their early stages in many countries of theregion. River basin water agencies depend on both regional andlocal authorities’ being sufficiently well structured toparticipate in river basin committees;

At the national level, the water management systems, or“sistemas de gerenciamiento de agua” as they are called in Brazil,are still not clearly differentiated. There are still no waterassociations or boards as such, either at the national or thelocal level. There are overlapping functions betweenorganizations and serious difficulties of interinstitutionalcoordination. All this gives rise to problems for theoperation of river basin agencies, gaps in the law andconflicts due to competing budgetary claims. It is thereforenecessary for the role of each institution in water managementto be clarified, both at the national and at the regionallevels;

For their operation, river basin agencies rely on theeffectiveness of systems such as the State or audit office,the judicial system, the police system, the educationalsystem, the organization of civil defence and the banks, toquote but a few of the exogenous actors. If these systems arenot effective or have no resources or if there is corruption,then each agency has to directly carry out these activities or

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help each of these systems to adequately discharge itsfunctions;

River basin agencies must have guaranteed continuity of theiractivities, particularly of technical personnel, who must beduly trained, well paid and sufficiently equipped to performtheir duties. River basin water management is a complex andsophisticated task if it is to be properly carried out. Thebenefits of good management far outweigh the cost of goodsalaries (there are currently cases where the director of ahydraulic engineering system, whose cost exceeds $500 millionand which serves to irrigate more than 40,000 hectares, earnsless than $100 per month and has only an old truck to travelaround the site);

Another key aspect is the need to regularize and update thepatterns of water users and also the metering and assessmentof water use. Until such time as updated patterns exist, withregistered and assigned rights of use as well as watermetering and distribution systems, there is little that can bedone to improve water quality control and distribution, andthe granting of water rights will suffer for lack ofinformation;

There are many other topics which merit consideration, such ashow to respect ancient indigenous communities’ traditionalwater management systems, how to involve new communities inwater management tasks, the possibility of setting upmunicipal river basins, the prospects for improving waterbasin management training systems and, in general, the need toshare experiences regarding legal, economic, scientific andsocial aspects.

These are the factors which will possibly contribute toimproving the formulation of public policies that will genuinelymake it possible to achieve sustainable development. There is noother way of making the transition from rhetoric to action.

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