Transcript Economic and Financial Aspects

Economic and financial aspects
of multiple uses system
Mary Renwick
Multiple Uses Discussion Forum
Economic values and decision making
Domestic
Drinking
Irrigation
Water
$
Home
Gardens
Enterprises
Livestock
Fisheries
Valuing Multiple Uses of
Irrigation Water: Sri Lanka
Uda Walawe
• Background
• Poor Performance
• Valuation work
Univ. of Minnesota & IWMI
Results
Irrigated Crops $25m/yr
• Paddy
• OFCs
• Bananas
$8.1 m
$3.5 m
$13.5 m
Home Gardens $8m
• Home
• Marketed
$2.03m
$5.97m
[insert pic]
Results
Domestic Use $140,000/yr
Fisheries
$743,000/yr
• Home
$64,000
• Marketed $679,000
– Fishers $390,000
– Sellers $289,000
Value in Alternative Uses
Type of Use
Value
US$ m
Irrigated
crops
24.9
Home
gardens
8.0
health
nutrition
gender


?
Banana



`
OFCs
Drinking
0.1



Fisheries
0.7


?
Total
33.8
Rice
Rice
OFCs
banana
Home gardens
Drinking
Fisheries
Market-led Approach to MUS: SIMI*
• Background
• Micro-scale MUS
• Market-led approach
MUS Development
• Domestic & Irrigation
– Surplus water for irrigation
• 28 community systems
• 1,000 households
• Cost
– $100 (tap)
– $10-$35 (irrigation equip)
MUS with dual tap for drip irrigation and domestic use.
• Benefit
– Income >$200/yr
– Health & nutrition
Low cost water storage tank for an MUS scheme.
How it Works … The Value Chain
• Input Supplier
• Producer
• Output Markets
Supply-chain development:
A key supporting investment for MUS
Results:
• 240 agrovets
• 5 tap/micro irrigation manufactures
• 2 drip assemblers
• 133 micro-irrigation dealers
• 7 extension services (7 districts)
Appropriate inputs for
• agriculture,
Sales of 26,230
micro-irrigation
systems
drinking
water
(and sanitation)
Note: Only 1,280 purchased via micro-credit
Embedded services
Producer
Results:
• Build capacity of early adopters
• 31,000 households (200,000 people) in 1500
farmer groups
• Facilitating access to inputs and
credit
• $7.3 million in increased incomes (BCA 3:1)
• Year 1: $100/hh for 16,000 households
• Education
• Year 2: $195/hh for 26,000 households
Market development:
Critical for economic opportunities linked to MUS
Results:
• 43 market collection centers
• Established value chains across 9 districts
serving 3 million
Government: key role
• Strategic investments
• Focus on market failures
Conclusions
• Economic valuation of alternative uses can
serve as a decision making tool
• Opportunity cost of non-integrated management
can be high
• Linking value chain approach to MUS can
increase economic returns and reduce
subsidies
Questions?