Development Aspects Impressum Editors

Capacity-building for water resources management

The challenge posed by the Green Economy is to balance economic, social and environmental goals for the aim of achieving economic growth, social equity and environmental stewardship. Rather than being in opposition, these three aspects complement each other and must be integrated holistically. The process of transi- tion can be associated with a process of structural change requiring “adaptation” strategies to be developed and trade-offs to be calibrated. The enabling condition of the transition is, in turn, the development of “adaptive” human and institutional settings to support such change at all levels.

Achieving green water economies will require WDM policies to be translated into a set of concrete policy measures. Institutions can be regarded as “the set of rules governing water use and to the specific organizational arrangements involved in the formulation and implementation of water resources laws, policies, strate- gies and programmes …enabling environment for water resources management”

(Hamdy, Abu-Zeid and Lacirignola, 2009, p. 129). Building institutional capacity is a fundamental precondition of the transition to the Green Economy. Capacity- building for water sector development has been defined as the “umbrella con- cept” (Morgan 1998 in Lusthaus, Adrien and Perstinger, 1999) that links previously isolated approaches to water resource planning and management into a broader, result-oriented, long-term strategy. It is, therefore, the ongoing process through which societies enhance their abilities to perform in terms of water allocation, plan- ning and management by both developing new institutional arrangements and strengthening those in place.

Successes and failures in water policy reflect the extent to which societies have enhanced the functioning and flexibility of institutions in order to address prob- lems, formulate solutions and finally implement reforms. Capacity-building can be regarded as the “missing link” in water resource development in the bulk of water- deficit Mediterranean economies whereas in other cases, such as Australia, it has proved to be key in underpinning the effective and coherent reforms of the water sector. Since the mid-1990s, this country has embarked on a broad, market-ori- ented water policy reform in pursuit of increased water use efficiency and sustain- ability. Traditionally, the use of water resources was tied to land rights and provided at low or zero cost, on a first-come-first-served basis. As the country entered into a “mature water economy stage”, the gap between water demands and available supplies was bridged through public investments at the expense of environmental assets and river flows (Freebairn, 2005, p. 10). A first fundamental shift in wa- ter policy occurred in 1994, with the Council of Australian Governments (COAG) statement, pushed further in 2002 and 2004, and complemented by the Green and White Papers, released by the Victoria State Government (2003 and 2004). A major aim of the different water policy agreements was to address the nation’s water resource (mis)management in an integrated fashion, and to prevent further uncoordinated and fragmented activities across the country’s territories (Stringer and Wittwer, 2001). Australia’s ongoing water policy reform includes greater use of market instruments; implementation of minimum public regulation, according to the principle of subsidiarity; introduction of a system of tradable water property rights; and allocation of river flows and recycled water to meet social goals, such as environmental flow requirements, through publicly-funded investments (Free- bairn, 2005; McKay, 2005).
For a new, holistic approach in water resource management to be embraced, institutional capacity-building must be developed at all levels (both horizontally and vertically) and needs to permeate every phase of water policy: from allocation to planning and management. Water management strategies must be integrated into broader environmental and development policies, and treated as strategic priorities, especially in water-deficit economies. As in the case of Australia, this would entail a major shift from centralized planning and public intervention, to- wards decentralized (and more efficient) decision-making. In this case, the public sector would play a key role as a market regulator, not as a player. This transition has occurred in many other economic sectors that have been liberalized and made open to competition. However, in comparison with other liberalized industries, the water sector poses additional technical, economic and political challenges. Even if

a comprehensive discussion of these difficulties is beyond the scope of this work, we nonetheless argue that: i) reducing the gap between social and private value of water resources is a prerequisite for the implementation of investments promoting water efficiency, especially in agriculture; and ii) pragmatic, second-best solutions are available, and should therefore be pursued and tailored to local contexts.

To sum up, the development of more effective institutional arrangements is a precondition for efficient, result-driven and adaptive water management. There is no single pathway for developing institutional capacity targeted at reforming the water sector. The choice and mix of strategies fundamentally depend on the site- specific political and social conditions, which determine both the acceptability and the viability of the required solutions.

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