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The provision of free basic water for domestic uses and a more equal distribution of water for productive uses are seen as important instruments to redress inequities from the past and eradicate poverty in South Africa (SA). Although the government committed itself to providing free basic water for all, this result is still far to be reached, particularly in rural areas. Financing of multiple use water services was identified as an important ingredient to insure improved access to water for rural poor in SA and at the same time allow productive uses and broaden livelihood options. Recent evidence indicated the potential contribution that productive uses of domestic water might make to food security and poverty reduction in rural areas of SA. Following the principles of integrated water resource management (IWRM), efficient, equitable and sustainable investment in improved water services should be demand driven, that is, it should be based on a thorough understanding of effective demand by consumers for multiple use water services. The assessment of demand for improved water services provides the basis for micro level analysis of consumer benefits from multiple water uses. Such studies are not common in SA's rural areas, where most of the economic analyses focus on either domestic or irrigation water demand. This study attempts to fill this gap by assessing the household demand for multiple use water services in Sekororo-Letsoalo area in the Limpopo Province. Choice modelling is the approach used to identify the attributes determining demand for water services and quantify their respective importance. Households are presented with alternative sets of water services, corresponding to different levels of the attributes. In this study, the following attributes were used: water quantity, water quality, frequency of water supply, price of water, productive uses of water, and source of water. Choice modelling allows estimating the relative importance of these attributes for various strata of the studied population, and ultimately provides a measure of the willingness to pay for different aspects of water demand (attributes), including productive water uses. Results show that households in rural areas are willing to pay for water services improvements. Due to the poor quality of present water services in the area, users are primarily concerned with basic domestic uses and demand for non domestic water uses is low. Only households already relatively well served are interested in engaging in multiple water uses.
This book presents a valuable new tool for water management water resource accounting which significantly advances the economic analysis of water. Water resource accounts integrate detailed information about water supply and use with national income accounts to show the economic use of water, costs and tariffs paid, and the economic value of water for different economic uses. Based on the UN s handbook for environmental accounting, this book describes the implementation and policy application of water accounts in three African countries Botswana, Namibia and South Africa and discusses how they have been used by water managers. The book compares water use across the three countries, explaining the differences in water resources and water policy. In addition to the comprehensive outline of physical and monetary water accounts for each country, the authors provide an extensive discussion of water valuation as well as addressing a number of issues of regional importance, including water accounting for an international river basin and the impact of trade on each country s water use. By demonstrating the usefulness of water resource accounts, this book makes a major contribution to the literature on water economics and management, sustainable development, and to the development of environmental accounting in general. The Economics of Water Management in Southern Africa will appeal to a wide readership including: environmental and development economists NGOs concerned with sustainable development environmental advocacy groups professionals (economists and environmentalists) working in Africa on water and sustainable development issues water professionals national accounts experts and statisticians.
Empirical studies have shown that while global per capita freshwater availability is declining, competition among production sectors for the withdrawal of this resource is rapidly increasing. This situation is exacerbated by the rapid population growth especially in developing countries, urbanization, industrialization, externality problems, environmental sustainability and the need to increase food production. At country specific levels, policies have been designed to institute water use efficiency, equity and sustainability. The need to promote sectoral water use efficiency from the demand-side management requires a study to investigate the responsiveness of different production sectors and sub-sectors to variations in water prices. In most instances however, efficient water allocation compromises social equity, especially in a country where there is widespread poverty and where the gap between the rich and the poor is so wide that policies aimed at promoting economic growth should be carefully investigated to find whether efficient water allocation can also address the issue of equity among the different population groups. Review of empirical literature on the econometric approaches to sectoral water demand analysis shows that the agriculture sector has the least marginal value of water compared with the manufacturing, mining and services sectors. Based on this evidence it can be hypothesized that water reallocation from the agriculture to the non-agriculture sectors in South Africa can lead to growth in sectoral output. However, in a country where there is a wide gap between the rich and the poor, equity issues are high on the development agenda. Therefore, the benefits derived from efficient water reallocation should be equitably distributed to improve the standard of living of the critical population. Hence, the second hypothesis is that water reallocation from the agriculture to the non-agriculture sector can lead to an increase in the income of the critical population. To investigate these hypotheses the study: estimated the sectoral water demand functions and marginal values, used both social accounting matrix multiplier and computable general equilibrium analysis to investigate the impact of water reallocation from the agriculture to the non-agriculture sectors on output, factor payments on households' welfare and analyzed the households' welfare of the impact of global change on water resources in South Africa. The study used the Global Trade Analysis Project (GTAP) and United Nations Industrial Development Organization (UNIDO) data, and adopted the marginal productivity approach, and the two-stage model to estimate the global sectoral water demand functions and marginal values for thirteen sectors. This model is extended to the sectoral water demand analysis in South Africa. Thus, to validate the results of the global model, the study estimated sectoral water demand functions in South Africa by extracting data from STATSSA's census of manufacturing and agricultural and services activities, published for each of the nine provinces in South Africa and the 2002 water supply and use accounts published by the same institution. The study tests the policy relevance of the computed marginal values for South Africa by using these values to investigate the impact of reallocating water from the agriculture to the non-agriculture sectors on output growth, value added, employment and households' income generation. To accomplish this objective, the study updates the 1999 social accounting matrix (SAM) for South Africa to reflect 2003 entries, computes the required multipliers and uses these to find how water reallocation on the basis of efficiency impacts sectoral output, households income generation and distribution. However, SAM multiplier analyses assume linearity, factor immobility and constant prices. The study therefore uses the computable general equilibrium analysis to investigate the households' welfare implications of sectoral water reallocation and reduction due to global change. The SAM multiplier analysis shows that reallocation of water from the agriculture to the non-agriculture sectors leads to decrease in the output of the agriculture and the highly inter-dependent sectors. Specifically, output declines in the agriculture, food, beverages and tobacco and the services sectors, while it increases in the other sectors. However, if more than ten percent of the agriculture sector's water is reallocated to the non-agriculture sector, net output declines, implying that the decline in output in the agriculture, food, beverages and tobacco and services sectors is more than the increase in output in the other sectors. This has consequences for factor remuneration, employment and households' income. The above decline in the agriculture sector's output leads to net job losses. Specifically the jobs lost in the agriculture sector are not countered by jobs created in the other sectors that benefit from the water reallocation. This is due to the fact that there are differences in skills requirements by the sectors. While the agriculture sector employs most of the unskilled workers, the other sectors require more medium and highly skilled individuals. This is reflected by changes in the wages paid to labourers. While the wages of unskilled labourers decline, there is an increase in the wages of medium and highly skilled labourers. The simulation results of the computable general equilibrium analysis show that sectoral water reallocation and reduction adversely impact the least and low-income households' welfare, while improving the welfare of the high-income households. The interpretation is that with water reallocation or reduction, capital is substituted for water in the non-agriculture sectors and this increases the interest paid on capital, which goes to high-income households who are the owners of the capital. The adverse consequence can be reduced if food consumption by the poor households is maintained. To do this, some welfare measures are necessary. One such measure is the distribution of food stamps to the poor households.
This book investigates the effective demand for rural water supply in South Africa, considering the application of a demand-responsive approach in order to improve project sustainability. The study was conducted as an Individual Research Project at WEDC in 1998, part of the author's MSc programme in Technology and Management for Rural Development.
Water resource development has played a significant role in the expansion of agriculture and industry in the Olifants River Catchment. However, currently water deficit is one of the major constraints hampering development in the catchment; both the mining and agricultural sectors are producing below optimal levels because of their reliance on insufficient supplies. In this study, the Water Evaluation and Planning (WEAP) model was used to evaluate scenarios of historic, current and future water demand in the catchment. For each scenario, the WEAP model was used to simulate demand in five different sectors (rural, urban, mining, commercial forestry and irrigation) over a 70-year period of varying rainfall and hydrology. Levels of assured supply were estimated for each sector and the economic cost of failing to provide water was predicted. For the future scenarios, the impact of infrastructure development and water conservation measures were assessed. The study illustrates how a relatively simple model can provide useful insight for resource planning and management.
This collection of papers is a snapshot of modern hydrogeology in which highly technical methods and approaches sit side-by-side with overlapping legal, social, organisational, institutional and governance considerations. Groundwater is integral to many human and environmental systems. Indeed, there appears to be a growing realisation that some of the most pressing physical problems in the field of hydrogeology - over-abstraction, salinization or pollution - can only really be solved by taking a multi-disciplinary approach to the issues that takes all other related professions into account. Whilst a ‘technical’ solution may be readily deciphered, the larger challenge usually lies in the sustainably-funded and widely-accepted implementation of that measure. This book ranges from discussion and debate on the hot topic of hydraulic fracturing of wells or ‘fraccing’ for shale gas and its potential to disrupt groundwater systems, to the application of highly technical modelling procedures to help solve complex, real world problems. It is a window on the preoccupations of modern hydrogeologists and an insight into the way in which hydrogeological techniques and methods are being holistically adapted to address problems in the real world. This book is targeted at professional hydrogeologists, sociologists, experts in governance, law and policy as well as ecologists and other professionals that nowadays all sit alongside groundwater understanding. The book will also appeal to politicians, resource managers, regulators and others interested in sustainable water supply.
In South Africa, precipitation is extremely variable and water is scarce. South Africa is also a country with great welfare needs. Challenging economic development targets and plans therefore need to be implemented successfully within the constraints of limited water supply and unreliable water availability. These economic development plans are underpinned by the development and growth of economic activities such as agriculture, mining, energy production and many types of small, medium and micro enterprises, which are some of the largest water using sectors in the economy. Within these activities, increased competition places pressure on water users to keep supplying their markets with competitively priced goods, while rising costs of new water supplies puts pressure on water users to allocate sufficient water to their production processes. These market forces and the relative scarcity of water as an economic production factor, impact on financial viability and imply that the economic efficiency of water use becomes increasingly important. The National Water Act of 1998 (NWA) is a legislative response to this situation, and promotes a radical shift towards efficiency and equity goals in water allocation. Water users who require water as an input to economic activities are consequently seriously revising their water use patterns in response to one of the major implications of the NWA and its related principal strategy: water demand management. Water demand management strives to adhere to the principles of equity, social justice, economic efficiency and environmental sustainability, which are central to the NWA. This study evaluates the costs and benefits of water use in order to simulate the effects of water demand management activities on a catchment economy. The results of a number of studies were combined to generate an economy-wide model: a Social Accounting Matrix (SAM), for the case study area and to simulate the direct and indirect effects of water demand management on the people, the economy and the natural environment in the area. Water demand management (WDM) is defined as consisting of two phases. In the first phase, goals of full cost recovery, improving water use efficiency and allocating water optimally are targeted. The second phase of WDM arrives when a situation of absolute water scarcity is reached within a catchment. In this phase water demand outweighs water supply and water has to be allocated according to its scarcity value. Water markets play a large role here. The SAM was used to simulate the direct and indirect impacts on the economy and the environment of a number of WDM related scenarios. Water e-allocation decisions and the effects of various WDM policy instruments, such as reduction of water use subsidies and increases in water tariffs were simulated. Unintended consequences of other environmental policies on water use, in this case, carbon tax, were explored. Water scarcity predictions were done, and some of the transaction costs involved in water trading was quantified. The study concludes with a discussion on the indirect effects on the economy, the environment and people of changes affecting the agricultural (including forestry) activities. The direct and indirect impacts of WDM policies on the economy and the environment, and the importance of environmental-economic models in water cost benefit modeling are also discussed. Implications for policy and management are highlighted. This study shows specifically how, through modelling various scenarios, policy decisions aimed at managing specific variables (e.g. water use, carbon emissions) have an economic and environmental impact much wider than the sector in which the policy was targeted for. Each scenario shows how a water transaction, or a change in subsidy in the agricultural (including forestry) sector, could impact on the output of other economic sectors, and therefore the economy as a whole. It is therefore evident that policy decisions, which are implemented at a macro level, and could have a major direct impact on a wider range of economic sectors, should be carefully considered as they could have large, undesirable, unintended consequences.
Rural Water Systems for Multiple Uses and Livelihood Security covers the technological, institutional, and policy choices for building rural water supply systems that are sustainable from physical, economic, and ecological points-of-view in developing countries. While there is abundant theoretical discourse on designing village water supply schemes as multiple use systems, there is too little understanding of the type of water needs in rural households, how they vary across socio-economic and climatic settings, the extent to which these needs are met by the existing single use water supply schemes, and what mechanisms exist to take care of unmet demands. The case studies presented in the book from different agro ecological regions quantify these benefits under different agro ecological settings, also examining the economic and environmental trade-offs in maximizing benefits. This book demonstrates how various physical and socio-economic processes alter the hydrology of tanks in rural settings, thereby affecting their performance, also including quantitative criteria that can be used to select tanks suitable for rehabilitation. Covers interdisciplinary topics deftly interwoven in the rural context of varying geo-climatic and socioeconomic situations of people in developing areas Presents methodologies for quantifying the multiple water use benefits from wetlands and case studies from different agro ecologies using these methodologies to help frame appropriate policies Provides analysis of the climatic and socioeconomic factors responsible for changes in hydrology of multiple use wetlands in order to help target multiple use water bodies for rehabilitation Includes implementable models for converting single use water supply systems into multiple use systems
This book is the result of a joint research effort led by the U.S. National Academy of Sciences and involving the Royal Scientific Society of Jordan, the Israel Academy of Sciences and Humanities, and the Palestine Health Council. It discusses opportunities for enhancement of water supplies and avoidance of overexploitation of water resources in the Middle East. Based on the concept that ecosystem goods and services are essential to maintaining water quality and quantity, the book emphasizes conservation, improved use of current technologies, and water management approaches that are compatible with environmental quality.