Transboundary Water Resources: Strategies for Regional Security and Ecological Stability

This chapter outlines the relationship between environmentally sustainable water use, sustainable development and regional security in Central Asia. Environmentally sustainable freshwater use is argued to be an essential component of sustainable development, including poverty reduction. It is also argued to be important for reducing the potential for insecurity in Central Asia, in the context of transboundary waters in the region. The chapter sets out key elements for environmentally sustainable water use and successful transboundary waters management.

Stochastic fluctuations of climate and hydrological regime caused by both natural and anthropogenic factors are the main reason for the big uncertainty of long-term hydrological forecasts. Consequently, they cause the necessity to reconsider the risk of economic activities at inland sea coasts towards its increase. To estimate such a risk some sources of uncertainty arising under the sea hydrological regime forecasting are considered in the paper. By use of digital models of a region, some features of morphometric characteristics (depending on the sea level) are revealed, and their contribution to the level regime variability is appreciated.

This paper briefly analyses experience of the Central Asian countries in solving problems associated with transboundary water resources.

The paper shows that over the last decade the co-riparians have made several attempts to adjust their upstream-downstream relations. Different interstate agreements and water treaties could be considered as proof of these efforts. However, as the last several years demonstrated, none of these agreements or treaties has been observed in full. Opposite attitude towards issues related to water allocation, regional water strategy and sharing maintenance/ operational expenditures has prevented the upstream and downstream countries from solving water-related problems.

The paper puts forward some useful recommendations that might contribute to solution of the problems in focus.

During the last ten years, water resources problems became particularly urgent in the Central Asian region. To solve that problem, heads of the five Central Asian states’ water-economical ministries had meetings with each other and signed some agreements on coordinated water resources management. Therefore, in each republic, specifically in Uzbekistan, works conducted towards the improvement of water resources control.

The principal spheres of water resources use in Central Asia today are irrigated agriculture and hydroelectric engineering.

Problem of mutual relations between irrigation and hydroelectric engineering in the region is determined by the fact that the countries of upper stream-Kyrgyzstan and Tajikistan are interested in the energy regime of river flowing use, and the countries of the lower stream-Kazakhstan, Turkmenistan and Uzbekistan are interested in the irrigative regime.

The only possible settlement of the water division problem in the region remains reconsideration of existed limits. As the world practice shows in today’s conditions its limits and needs for water which is the most moveable, changeable element of interrelations between the countries.

Directive 2000/60/EC of the European Parliament and the Council of 23 October 2000 establishing a framework for Community action in the field of water policy (Water Framework Directive (WFD)) entered into force on 22 December 2000. The Directive as one of the most substantial pieces of EU water legislation combines the until then rather fragmented EU water law (large number of directives dealing only with special aspects of water management like waste water, dangerous substances, drinking water etc.) in order to ensure sustainable water management.

EU Member States have to define river basin districts as the main units for all management actions. For example the Rhine or the Danube with all their tributaries, associated groundwaters and coastal waters are two of the biggest international river basin districts in Europe. The river basin approach requires transboundary water management and therefore a lot of cooperation and consultation among the EU Member States. Although there have been several bilateral agreements and international river basin commissions in Europe until now water management happened mainly on national level. To fulfill the WFD requirements cooperation has to be intensified and new structures have to be established in the future.

The WFD aims at achieving good status of all water bodies (good ecological and chemical status of surface water bodies, good chemical and quantitative status of groundwater bodies) in a river basin district until December 2015 (with possible prolongations until December 2027). Good status is defined by ecological, chemical and quantitative criteria, which are described in detail in the annexes of the WFD. Ecological criteria, which the WFD considers as the most important to assess the status of surface water bodies, are a new element in EU water management. The diversity and abundance of the fauna and flora in a water body have to be examined and monitored. The EU Member States are obliged to define water body types and type specific biological reference conditions.

Economic aspects are also relevant in the WFD. The Directive requires the recovery of costs for water services including environmental and resource costs. EU Member States shall ensure by 2010 that water-pricing policies provide adequate incentives for efficient water use and that industry, households and agriculture contribute adequately to the costs of water services.

The Directive has to be implemented in different steps. Until December 2004 an analysis of the characteristics of the river basin district, a review of the impact of human activity on the status of water bodies and an economic analysis of water use are required. On the basis of these analyses and reviews the EU Member States have to develop monitoring programmes until December 2006 at the latest and later on they have to decide on the necessary measures in order to achieve good status of all water bodies. The main instruments of the Directive are national programmes of measures and national or international river basin management plans, which have to be established until December 2009 for each river basin district. Public participation and consultation play an important role in the production of programmes and plans. The measures have to be implemented until 2012, after that the instruments are reviewed and if necessary updated. The European Commission on the basis of reports by the EU Member States controls the implementation process.

The legal and technical implementation of the WFD is under way. A lot of questions have still to be answered. In order to facilitate and to harmonize the implementation process the European Commission and the Member States have developed several guidance papers with regard to important WFD requirements (analysis of pressures and impacts, economic analysis, public participation etc.).

The last decade there has been a growing interest in the idea of “treating water as an economic good”. There is, however, a lot of confusion about the meaning of “treating water as an economic good”. It relates to making the right choices about optimal use and optimal allocation of water among users on the basis of socio-economic trade-off analysis. Insight into the value of water in alternative uses is important for making the right choices. This is different from water pricing, which is an economic instrument that can be used to achieve policy objectives, such as demand management or cost recovery. “Treating water as an economic good” does not automatically mean that water should be allocated by competitive market prices so that the available resource is fully allocated, and allocated to its highest-value uses as is often believed. There are other economic instruments that can be used as well such as tradable water rights, subsidies and block-rate tariffs. Regulatory instruments, such as rationing, and persuasive instruments, such as extension, can also be very cost-effective and suitable.

The suitability of instruments depends on the kind of water policy objectives, such as cost recovery, to ensure that supply and demand are brought into equilibrium or to reallocate water from less to more productive uses. Often more instruments are needed simultaneously and preconditions have to be fulfilled. Water is an economic good in the sense that it cannot fully satisfy demand for al its alternative uses simultaneously. Water is, however, also a social good whose availability to certain groups and for certain purposes will serve the greater benefit of society as a whole. Access to clean water is often seen as a basic right of all human beings. It is often considered as too vital to be left to the economic forces of profit- maximisation. Goals other than efficiency, like social equity and sustainability, are often guiding. This explains why the government often subsidises those uses of water that have a high value, but low ability to pay.

Economic instruments have a number of advantages. They increase the water use efficiency. Besides, they offer ongoing incentives to reduce usage and to innovate. They are flexible -in the sense that they can be modified and adjusted easily-. Finally, they may generate revenues. In spite of these advantages, economic instruments are not widely applied in water resource management for a number of reasons. Firstly, there might be market imperfections, such as externalities. Secondly, there might be an uncertain relationship between charges and impact on water use. Water prices are often small compared to the value of water. A considerable increase in the price of water is needed to affect demand, which is often socially not desirable. Thirdly, they may not be widely applied because they are new or politically sensitive. Fourthly, transaction costs may be high relative to the size of the efficiency gains. Finally, preconditions for implementation are often not met, such as defined water rights or volumetric measurement. The role of economic instruments to promote a sustainable use and management of water is therefore currently limited. Economics mainly plays a role in the analytical part. Economics provides us with tools that may be useful in resolving competition among alternative uses.

The suitability of economic instruments for transboundary water management will be discussed on the basis of a case study. Egypt is mainly served by surface water from the river Nile and Lake Nasser. Egypt currently receives 68 bm3 of surface water per year and uses about 60 bm3, which exceeds the 55.5 bm3 of water ‘agreed’ with Sudan. When Sudan uses all its water entitlements, water supply will decline. Water availability in Egypt will be insufficient considering the high water demand for intensive cropping and plans of the government to expand the irrigated area by 40%. Besides there is a rapid increase in population and water demanding industry. The amount of water assigned to Egypt and Sudan is specified in quantity and time on the basis of rationing. Often this does not allocate water in an economically efficient way. Theoretically water entitlements -which can be considered as a kind of water use rights- can be re-allocated between countries through market mechanisms, i.e. introduce tradable water rights. The marketability of rights encourages users to reduce low value usage and sell surplus water. Such a reallocation is, however, politically sensitive and high transaction costs will be involved

Accurate and continuous monitoring of lakes and inland seas is possible since 1991 thanks to the recent missions of satellite altimetry (Topex-Poseidon, ERS-1, ERS-2, Jason-1 and Envisat). Global processing of the data of these satellites could provide temporal and spatial times series of lakes water level from 1991 to 2003 on the whole Earth with a decimeter precision. The response of water level to regional hydrology is particularly marked for lakes and inland seas of semi-arid regions. Altimetry data can provide an invaluable source of information in hydrology sciences, but insitu data (rivers runoff, temperature, precipitation etc.) are still strongly needed to study the evolution of water mass balance of each lake. Moreover, sea level variations that result from variation of hydrological parameters such as river discharge, precipitation and evaporation, are very sensitive indicators of regional climate variations. Recent results obtained on Aral Sea and Issykkul Lake are presented here. Inter — annual changes of water level have been obtained over these lakes that must be interpreted in term of hydrological water balance. Since 1960 the Aral sea has been drying and since 1989 it is divided into two lakes that follow different evolution, the Big Aral in the south which continuously dried up the last 10 years, while the so- called Small Aral in the north presented large inter-annual fluctuations related to constructions and destructions of a dam in the Berg’s strait retaining the water from the Syr Darya. For Issykkul, a slow decrease of the level has been observed over the last hundreds years (4 cm / year), followed by an abrupt and bigger increase of the level of around 10 cm/yr since 1998. The impact on local populations and infra-structures of these fluctuations are dramatic in the case of Aral, much less in the case of Issykkul, but comparative study of both water bodies may help in the future to understand the respective consequences of human-induced activities from the natural changes. It is also the task of a new project recently submitted and accepted by the NATO with scientists from Uzbekistan and Kyrgyz Republic.

After the collapse of the Soviet Union, Kyrgyzstan, Tajikistan, Uzbekistan, Turkmenistan, and Kazakhstan became independent states. The Amu Darya and Syr Darya Rivers, which were once under the auspices of one country, were now shared among five republics. Management of the two rivers and coordination of the water-sharing regime—once the responsibility of Moscow—became embroiled in the politics of newfound sovereignty. The water sharing regime and barter arrangements, which involved trading cheap fuel and electricity provided by downstream countries (Uzbekistan, Turkmenistan, and Kazakhstan) for water released by upstream countries (Kyrgyzstan and Tajikistan), was interrupted. Payments for reservoir upkeep were also halted. Additionally, Kyrgyzstan and Tajikistan have argued that they would like to develop their hydropower potential and receive monetary compensation for the inequitable water-sharing regime, favouring cotton production downstream. The five republics have achieved little progress in better sharing and managing their common waters and the current situation is far from satisfactory. In addition to discussing the water dispute and considering some of the interim progress made among the countries, this chapter will review lessons from other international water agreements that may provide a more adequate and long-term solution to the Central Asia water dispute. The chapter will specifically highlight two main principles (compensation for facility use and compensation for downstream benefits), which are expressed in several agreements that span conflicting water uses among upstream and downstream states. These principles can, in turn, be appropriately applied to the dispute over the Syr Darya and Amu Darya Rivers.

This chapter assesses the geostrategic and geopolitical implications of water shortages in Central Asia and argues that resource scarcity or competition cannot be separated from other regional realities. On-again, off-again relations between Central Asian states, as well as the so-called war on terrorism, bear significant implications for the region. Thus, the convention of defining Central Asia as a grouping of five states is increasingly less relevant for policy making and sound strategic analysis. Central Asia is linked to the entire Caspian basin, the South Caucasus, Afghanistan, Pakistan, Iran, Turkey, and China’s Xinjiang province. Equally, the long- term interests of Russia and the United States now play into the complex realities of Central Asia. Specifically regarding water shortages, a number of vulnerability issues involving so-called “non-traditional” security present serious long-term challenges to the stability of the region. The chapter argues that there are crucial differences between threats and vulnerabilities, distinguishes between the two, and suggests relevant policy applications for the Central Asian states. The analysis includes a review of theoretical models that have been proposed in research. Specifically, this review addresses what have been argued as “trigger mechanisms” that can unleash violent conflict, create socio economic disparity, and induce long-term insecurity, and provides possible pathways for geostrategic solutions and means to reduce water resource tensions.